Sunday, June 16, 2024
Hawai'i Free Press

Current Articles | Archives

Monday, February 22, 2021
How Minimum Wage Worker Makes $72K
By News Release @ 3:35 PM :: 3445 Views :: Labor, Small Business, Cost of Living

Highway Inn Opposes an Increase in Minimum Wage to $12 on July 1 st, 2022.

Testimony in Opposition to SB676, Feb 8, 2021

Highway Inn's employees already earn more than $15 per hour because that is what the market for restaurant labor in Hawaii demands. Businesses need more flexibility to compensate their staff, not less.

The MOST IMPORTANT fact to understand is that in Full-Service Restaurants, most workers who earn minimum wage receive significantly more compensation in tips. In fact, in 2017, a full-time server reported over $72,000 in income on her W2. SB676 & similar bills create unintended and harmful consequences to employees, businesses, customers, and the local economy.

Moreover, Hawaii's employers also provide mandated healthcare for qualifying employees at almost $1,000 per older employee per month. We also have Paid-Time-Off and make 401(k) Contributions. We also have a kitchen service charge, introduced when tip pooling prohibited businesses from sharing a portion of gratuities to the kitchen staff that adds between $1 and $4 per kitchen employee.

SB676 will dampen the economy's recovery. Here is what will happen:

1. Restaurants will raise prices according to the increase in labor costs: a. The minimum wage increase's main recipients will be the highest compensated labor group that makes minimum plus additional gratuities of $15-$25 an hour.

2. Demand for restaurant meals will fall. Restaurants will earn less income than the increase in prices, and probably less overall because consumers have less expensive choices.

a. Restaurants will order fewer supplies, require less labor & seek more labor-saving pivots

b. Businesses compliance with income and labor reporting reqs. will decrease – we already lose employees to other enterprises paying staff 'off the books' & not reporting income

3. DoTax GET receipts, State-Tax, and other State income sources will fall as restaurants downsize.

4. Customer choice will diminish and tourists will have fewer places to spend their $s.

Restaurants are competitive businesses for both customers and labor. Government has recently learned that direct and targeted assistance to disadvantaged workers is the most effective form of economic aid and companies are not good proxies for government work as illustrated in 1-4 above.

There are already two established mechanisms to successfully manage wages at restaurants: using Federally approved Tipped Wages and permitting Tip Pooling among all staff. We strongly recommend a meaningful implementation of these laws here in Hawaii to reinvigorate our local restaurant businesses.

The CBO recently estimated that an increase in the minimum wage to $15 an hour would cause 1.3 million workers to lose their jobs. Hawaii needs to perform a similar analysis.

Thank you for allowing us to share our perspective on this critically important issue.

SB676: Text, Status

2013: How Hawaii Minimum Wage Workers Earn $24.24 per hour

2014: Flawed Minimum Wage Hike Advocacy Will Cost Hawaii's Poorest Workers $7M this Year


TEXT "follow HawaiiFreePress" to 40404

Register to Vote


Aloha Pregnancy Care Center


Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii


Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together


Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii

Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii

National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii


OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii

Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii

Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii