Taking back their tips

Michael J. Mishak and Lisa Mascaro

Thursday, Aug. 3, 2006 | 7:57 a.m.

Congress' minimum wage hike would stiff those in Nevada's tip-intensive industries

Timing, they say, is everything. And a bill approved last weekend by the U.S. House of Representatives - rushing to adjourn for the August recess and hoping to have ammunition for the November elections - may have started the clock ticking in Nevada.

The Republican-dominated House found a way to stir up Nevada's low-income workers, anger others who sympathize with them and possibly provide a defining issue for the midterm elections: the minimum wage.

By Wednesday, which happened to be the 10th anniversary of the last increase in the federal minimum wage, Nevada dishwashers, waitresses, pizza chefs, valets, union chiefs and the political Class of '06 were all chattering about a bill that would adversely affect minimum-wage workers who also earn tips in seven states. That includes tens of thousands of Nevadans.

The bill, if approved by the Senate and signed by the president, would wipe out an expected $1 increase in Nevada's minimum wage, which was approved by 68 percent of the state's voters in 2004 and expected to be easily ratified this November.

It would replace it with a three-stage increase that would, by 2009, put the hourly minimum wage at $7.25. It would, however, remove the provision in the seven states that guarantees the minimum wage even to those who earn tips. In the other 43 states, workers can be paid as little as $2.13 an hour if their average tips bring them to the current $5.15 minimum wage.

The provisions were slipped inside the bill that promised a series of increases in the federal minimum wage over three years. But language deep in the bill would effectively overturn laws in Nevada and six other states that require employers to pay no less than the minimum wage to all workers, even those who earn tips.

"I'd like to see a politician live off of $5.15 an hour," said Diana Serrani, a 54-year-old waitress at the Cynnamon Styx coffee shop in Henderson. The minimum wage increase in Nevada would lift her above the poverty line, she said.

Should the federal legislation take effect, however, Serrani's hourly wage could drop by more than half as she also receives tips. In a waitress's world, tips are everything, and Serrani said she hardly has anything left at the end of the month.

"Everything I have goes to my bills," she said. "The extra dollar would mean a lot."

Her view and that of other workers who depend on tips in Nevada is in stark contrast with the National Restaurant Association, which has lobbied hard on Capitol Hill for the change in how the seven states handle the minimum wage.

Brendan Flanagan, NRA vice president of federal relations, acknowledged as much: "This is a way to bring those other seven states into the fold."

All three of Nevada's House members voted for the bill, leaving them in the tricky position of explaining their votes on an issue so close to the pocketbooks of so many Nevadans.

Republican Rep. Jon Porter stood by his vote Wednesday, dismissing Democrats' wage-slashing scenario as a desperate stunt to confuse the issue rather than hand Republicans a legislative victory three months before the midterm elections.

Even if Nevadans see their $1 pay raise approved at the polls in November taken away for tips, he said they'll still be better off .

His likely challenger in November, Democrat Tessa Hafen, linked Porter with other Republicans who had opposed bringing the minimum wage to a vote until they could load up the bill with additional provisions, such as reducing estate taxes for America's wealthiest citizens .

Porter spokesman T.J. Crawford said only Democrats "would claim that a minimum wage increase would actually hurt workers in Nevada and across the country. Minimum wage earners are smarter than that. Plain and simple, their wages are going up."

Republican Rep. Jim Gibbons, at a Nevada Tourism Alliance event Wednesday, said he voted for the bill because it was tied to the estate-tax cut. The tip-credits issue, he said, didn't play a significant role in his decision. Because the minimum wage increase and the estate-tax cut were part of the same bill, he said, the issues would "balance each other out."

Democratic Rep. Shelley Berkley supported the bill, she said, to show her support for a provision she sought for years that would extend a federal tax deduction that benefits Nevadans. That provision allows those in states without income taxes to claim sales taxes they paid as a deduction .

Senate Minority Leader Harry Reid, D-Nev., called the bill "a farce."

"This is not a good minimum wage bill. This is not even a fairly good minimum wage bill."

Sen. John Ensign, R-Nev., who indicated earlier this week that he would support the House bill, said Wednesday that he is still reviewing it.

Nevada union officials lashed out Wednesday at the bill. Although their memberships are protected by collective-bargaining agreements, their ire was palpable.

"It's a disaster for us," said Danny Thompson, executive director of the Nevada AFL-CIO . And for workers who rely on tips, he said, the bill "is the end of the world for them."

Back at Cynnamon Styx on Wednesday, dishwasher Robert Voyles was on a break and having lunch with his wife and 5-year-old son. They eat regularly where he works for minimum wage because he gets an employee discount. :

"A dollar (an hour) adds up. It would be nice to be caught up on our bills and still have something left over."