Raising pay for restaurant employees:

Am I the only one who thinks this is a bad idea? The Boston Globe did an article on tipped employees.

“At the state level, some efforts have been made to help workers dependent on tips for part of their income. The Delaware Senate approved a bill this month that would raise the minimum wage for service workers and others who depend on tips. Supporters say it would help low-wage workers struggling in the current economy. In April, the Missouri House of Representatives rejected legislation that would have lowered base wages in the state for tipped employees.”

The reason tips are down is because traffic is down and revenue is down. Legislators think the way to solve this is to raise pay for tipped employees: How do they expect the restaurant to pay for the extra wages they are legislating? The end game of this enlightened thinking is that the restaurant will close, thus reducing sales tax, unemployment tax and income tax collections, the employee will be without a job which will increase unemployment benefit payouts which leads to further fiscal insolvency.