Saru Jayaraman: The devastating impact of sub-minimum wages on women

NOW Feminist Public Square Book Club had the honor of hosting Saru Jayaraman, author of the eye-opening book “One Fair Wage”. In his post, Jayaraman discusses the nuances of wage rates in the American workforce, highlighting the systemic inequalities faced by millions of marginalized Americans. To address wage practice deficits, Jayaraman launched the national One Fair Wage campaign, which advocates for the elimination of sub-minimum wages and the establishment of full and living wages nationwide.

The federal minimum wage is set at $7.25 per hour. Nevertheless, millions of employees across the country are only compensated with a wage rate of less than $2.13 per hour. In fact, 43 states allow employers to pay workers wages below the minimum, as long as their tips—combined with their direct compensation—amount to the value of the minimum wage. This is the sad reality for almost all tip workers in the service industry.

The restaurant industry is the largest employer of women in the United States. As a result, the overwhelming majority of tipped workers are women, meaning they are disproportionately affected by sub-minimum wages. In her webinar for the Feminist Public Square, Jayaraman discussed the myriad repercussions caused by sub-minimum wages. Not only are tipped workers three times more likely to live below the poverty line, but they also experience higher rates of sexual harassment than workers in any other industry in the United States.

SEXUAL HARASSMENT: Sub-minimum wages force employees to rely on tips rather than a fixed salary for their base salary. As a result, employees are often forced to tolerate inappropriate treatment from customers, as their pay depends on the tips they receive. Additionally, women are encouraged by employers to sexualize themselves at work in order to earn larger tips. Data revealed that women who engage in flirtatious behavior and allow physical contact with customers receive significantly more tips than women who don’t, prompting them to act provocatively. Female workers often face despicable sexual harassment in the workplace, but are unable to impose limits due to their financial needs. This causes women to internalize that sexual harassment in the workplace is inevitable rather than unacceptable.

RACIST ORIGINS: The use of subminimum wages began in the late 1860s, shortly after the emancipation of slaves in the United States. In order to circumvent providing newly freed slaves with fair wages, employers set a new standard; rather than being paid the hourly minimum wage, employers were able to force black employees to rely solely on tips. When this practice began, black-tipped workers did not receive wages. Well over a century later, with tipped workers guaranteed to be paid less than $2.13 an hour, it is clear that the situation has not improved significantly. The economic impact of slavery on black Americans is still significant today; it is no coincidence that the lowest paid workers in the United States are people of color, nor that black women receive fewer tips than any other group of tipped workers. Sub-minimum wage rates are a direct remnant of slavery and devalue the time and effort of minority populations.

MARGINALIZED COMMUNITIES: Tipped workers in the service sector aren’t the only employees being paid sub-minimum wages. Disabled workers, youth workers and incarcerated people are equally, if not more, likely to be denied full and living wages. This proves that the sub-minimum wage rate is inherently ableist and legitimizes the devaluation of the work of marginalized people.

WHAT THE EVIDENCE SHOWS: There is a common misconception that higher wages will lead to economic decline in the service industry. However, evidence has repeatedly suggested that this is not the case. In fact, the seven states that have banned sub-minimum wages have seen an increase in restaurant sales per capita, as well as increased levels of job growth in the service sector. In addition, when sub-minimum wages were eliminated, cases of sexual harassment against female restaurant workers were cut in half. This change can be attributed to the fact that women no longer had to endure harassment to support themselves and their families financially, as their wages did not depend on tips from customers.

PANDEMIC EFFECT: During the pandemic, millions of service sector workers have faced unprecedented unemployment, lower wages and increased levels of harassment. For nearly two years, workers have been forced to take great health risks to maintain their employment status. Additionally, workers have had to enforce social distancing and mask protocol at work, often facing resistance from customers. Despite these sacrifices and additional obligations, employers have still not provided their employees with the minimum wage they deserve.

HOW TO ACT: For the first time in history, there is a chance to eliminate sub-minimum wage practices across the country. It’s not a partisan issue; in fact, there is overwhelming public support for establishing universal living wage rates, regardless of the political affiliation of citizens. Moreover, there is momentum for positive change. The most effective way to raise wages to a livable level is legislative reform. Saru Jayaraman recommends that everyone immediately call their legislators and voice their support for establishing universal living wages.

Additionally, Jayaraman urges the public to provide service sector establishments with direct feedback. She encourages people to confront the managers of their favorite local restaurants and voice why the full minimum wage is necessary to achieve racial and gender equality.

Jayaraman also encourages the public to learn about establishments in their area that offer their employees to tip the full minimum wage. The directory of restaurants across the country that offer fair wages can be found here:

Additionally, Jayaraman strongly recommends that all states implement a minimum wage of at least $15, plus “tipping.” Even better, foodservice establishments should consider including automatic tipping in the bill, as many European and American restaurants have already done.

Sub-minimum wages perpetuate the oppression of the lower working class and prevent marginalized populations from improving their economic status and quality of life. For racial and gender equality to be achieved in the United States, sub-minimum wages must be eliminated entirely.

Nora Weiss, Government Relations Intern

Further information :

A Fair Wage: Ending Underpayment in America, by Saru Jayaraman (2021)

Fork: A New Norm for American Restaurants, by Saru Jayaraman (2016)