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In this episode: Newt and Callista Gingrich join us to talk about their documentary about Pope John Paul II, and Greg has a medical procedure. This podcast is courtesy of Sirius 159/XM 117 (The Catholic Channel). You can get a full three hours of The Catholics Next Door, Monday through Friday from 10AM to 1PM EST, only from Sirius/XM. Sign up today!
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Thank you, Greg and Jennifer, for this podcast with Newt and Callista Gingrich. My copy of the DVD just arrived in the mail yesterday. It will make a great Father’s Day present!
This is about the tipping discussion on the May 19 show.
What was missing in the discussion is the purpose of tipping. Tipping in the US exists to bring the $2.13 minimum wage for people who receive tips up to the Federal $7.25 minimum wage. If an employer can establish that average tips for a certain position come within $2.13 of the federal minimum wage then, the employer can stop paying $7.25 per hour and pay $2.13. My friends who worked in college towns rarely made more than $3 an hour. So if a cashier is regularly tipped his employer can cut his hourly wage.
Currently an employer who has tipped employees has to prepare W-2s with the assumption that all tipped employees get at least 8% of gross sales in tips, even if total tips reported to the employer are less than that. This puts some employees who $2.13 per hour in the position of paying income taxes on money they didn’t receive. In high end restaurants where people are regularly tipped at more than 8% of the gross sales, employees only report 8% and then fail to pay taxes on income they received. My friends who waited tables at 4 and 5 star restaurants, made upwards of $15 per hour.
As you can see the tipping system effectively shifts tax burden from reasonably compensated individuals to low income individuals.
As Catholics I think that we need to lobby for the elimination of the lower “servers” wage and have one minimum wage for all.