As the owner of Great New Hampshire Restaurants, I’ve dedicated decades to the restaurant industry. I began as a server and grew our business from one location in 1984 to nine today, employing 800 people and serving over two million guests each year. This year marks our 40th anniversary, a testament to the opportunities our restaurants provide—not just as dining venues but as pathways to financial independence for our team and as commitments to our communities.
More than 60 percent of adults have worked in a restaurant, often beginning their journey toward self-sufficiency. This passion for our industry compelled me to testify in Washington, D.C., about the dangers we face from misguided policies threatening our growth, particularly the tip credit elimination.
The tip credit allows restaurants to pay tipped employees a lower base wage, expecting that tips will bridge the gap to the minimum wage. At my establishments, servers earn between $20 and $30 per hour, significantly above minimum wage, thanks to their tips. This system manages labor costs, enabling us to employ hundreds and provide substantial earning potential
Critics argue the tip credit leads to income instability and vulnerability during slow shifts. However, this perspective misrepresents the situation. The tip credit includes a safety net to ensure no worker earns less than the minimum wage. Eliminating it would harm the very workers these critics aim to protect.
The restaurant industry operates on razor-thin margins. A significant increase in labor costs due to removing the tip credit would force many establishments to raise prices, cut hours, or close altogether. In New Hampshire, two restaurants that adopted a flat hourly wage saw their servers leave for more lucrative tipped positions, ultimately leading to their closures.
Moreover, the push to eliminate the tip credit overlooks the workers’ voices it purports to support. At my restaurants, employees created www.welikeourtips.com to oppose changes limiting their earning potential. Tipping empowers them to control their financial success, compensating exceptional service and hard work.
We must also address the Department of Labor’s threats to restrict the time tipped employees can spend on non-tipped tasks. Restaurant workers frequently switch tasks—like rolling silverware or resetting tables—while ensuring a smooth dining experience. The impractical 80/20/30 rule, which required detailed tracking of these activities, was thankfully struck down, but the risk of its return remains.
Flexibility is essential in the restaurant industry. Employees adapt to customer needs, and rigid labor rules disrupt operations, harming both workers and businesses. The proposed Tipped Employee Protection Act (H.R. 1612) would safeguard against burdensome regulations like the 80/20/30 rule, allowing restaurants to operate efficiently.
As we celebrate our 40th anniversary, I reflect on the countless careers built in this industry, where entry-level positions lead to personal and financial growth. However, these opportunities are under threat.
I urge policymakers to listen to the voices of workers and business owners who live this reality daily. We need policies that protect the tip credit, support operational flexibility, and ensure the continued success of our industry. Without these protections, both workers and the broader local economy will suffer.
