TGI Fridays CEO Ray Blanchette said that President Joe Biden’s proposal to eliminate the tipped minimum wage would likely result in fewer hours for the chain’s waitstaff and higher menu prices.
Biden has proposed raising the federal hourly minimum wage from $7.25 to $15 and eliminating tip credits, a change that would primarily affect the restaurant industry. The changes would mean that employers would have to pay every worker at least $15 an hour, even if they receive tips.
In 43 states, employers can pay their workers as little as $2.13 an hour as long as that hourly wage and tips add up to the locality’s pay floor. Otherwise, the employer has to make up the difference. The tipped minimum wage was last raised in 1991.