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Oh, You Wanted to Earn MORE?

March 5, 2015

I have at least one family member who says I’m against people making a fair wage.  And that’s not true.  I’m all for the market paying what it can bear, but not so much that the market is upset.

Here’s one case from Oakland.  The city recently enacted a wage hike, and that’s starting to mean that restaurants have to pay the employees more.  In some cases, that’s being passed on in the prices, but here’s an interesting take on things:

At Bocanova, a high-end restaurant in Jack London Square, there’s now no line for tipping on the check. A note on the menu reads: “In lieu of gratuity, a 16% Lift Up Oakland Surcharge & 4% Service Charge will be added to your check beginning March 1st, 2015.”

The 4 percent goes directly to servers. The 16 percent covers the cost of raising other staff salaries.

Owner Rick Hackett is betting on the idea that customers will respond better to a percentage fee than increased prices across the menu.

And hey, this is fair.  Instead of the servers making money on tips, they now just get what’s essentially a flat salary based on business, and that goes the same for the rest of the restaurant workers.  I mean, this is what the people who enacted the measure wanted, right?  It’s perfectly fair to make sure everyone is equal and not open up the opportunity for good service to be rewarded unfairly…

I hope Oakland figures this out.  It’s interesting to see how the real unintended consequences work out.

Incidentally, I’m sure you saw that Walmart recently raised its minimum wage for workers.  Or maybe you didn’t, because all those people who were complaining about still hate Walmart, so they’re not trumpeting the change.  You know what’s going to happen with that?  Walmart workers will get paid more.  And all the other retail businesses around Walmart will be either forced to raise wages or risk losing their best people to Walmart.  It’s not at all surprising to me that the companies that can best afford to raise wages will do so, and that other companies will suffer as a result.

So, glad this push for higher wages is working out so far…

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