Bar and restaurant owners, as well as tipped employees, let out a sigh of relief this afternoon when Governor Snyder signed Senate Bill 1171 (minimum wage) and Senate Bill 1175 (paid sick leave) into law.
“I’m sure this was a tough decision for Governor Snyder, but it was the right decision,” said Michigan Licensed Beverage Association (MLBA) Executive Director Scott Ellis. “This is a huge win for the hospitality industry.”
The original language found in the minimum wage ballot proposal received backlash from many servers in the industry who were worried that the removal of the tip credit would have negatively impacted their pay.
“Every server I’ve met throughout the last couple of months didn’t want the tip credit removed,” Ellis said. “Most servers make much more than $12 an hour and the language in the ballot proposal would have been unfavorable for them in the long-run.”
Many bar and restaurant owners throughout the state said they would have had to close their business or significantly raise menu prices, which could have had an adverse effect on tipping practices, if the tip credit was abolished.
“Most bar owners would have had to bring in tens of thousands of dollars more per year in order to remain in business,” Ellis said. “So, from an industry standpoint, this would have been bad for both owners and employees.”
The second bill signed by Governor Snyder grants paid sick leave to everyone who works for an employer with 50 or more employees.
“Removing mandatory paid sick leave for businesses with fewer than 50 employees was the biggest win for us here,” Ellis said. “Small businesses in the hospitality industry should have sick leave policies, but we’ve always believed it should be up to the small business owner to decide what they can offer.”
Both of the bills signed by Governor Snyder were exceedingly controversial with strong advocates and proponents on each side.
“It was great to see so many factions in the hospitality industry come together to help get these bills amended. Especially since it’s difficult to come to an agreement on legislation this important,” Ellis said. “The hospitality industry is one of the most important sectors of our economy, and with the signing of these laws, the industry can continue to flourish.”