Blog | August 01, 2012

The Alberta government thinks you should tip more. While tips are entirely up to a customer's discretion (except in some instances of group seatings at restaurants) and the Alberta government doesn't recognize tips as wages, it's depending on you, the customer, to help supplement servers' incomes so it, and the restaurant industry, doesn't have to. Last year, after a review of the minimum wage, Alberta implemented a two-tier system where servers who deal with alcohol earn a lower wage than those who don't. The government's reason: those who serve alcohol make higher tips, balancing out their wage. Anti-poverty advocates campaigning for a living wage argue this is leaving workers vulnerable to earning a wage below the low-income cut off.Since September 2011 servers of alcohol in Alberta earn $9.05 to the general minimum wage of $9.40. According to the Minister of Employment and Immigration at the time, Thomas Lukaszuk, the wage differential was put in place to recognize the tips received by front-line alcohol servers. "Having a different minimum wage for liquor servers recognizes that these individuals earn a significant part of their income from tips," said Lukaszuk in a press release announcing the change. "It will also give business owners greater flexibility in the way they pay other staff, such as cooks and dishwashers." But as any server knows, tips are not a guarantee.According to the Alberta government's profile on minimum wage workers, only one in eight minimum wage earners worked in the food and beverage industry where they might earn tips. And even then, if they are earning tips, those tips may not go toward the worker. Tip-outs, where managers and business owners take a portion of tips, are a common practice in restaurants and bars and there is no regulation or employment standard stopping employers from collecting a portion of the tips coming in. In Ontario, NDP MPP Michael Prue has spent several years advocating the implementation of legislation which would amend the employment standards act to prevent employers from taking any portion of an employee's tips. But there is no similar move here in Alberta, nor is there any requirement for employers to advise of tip-outs that might occur. According to Jay Fisher, a spokesperson for Alberta Human Services, there is no interest in legislating tips or tipping procedures. "We leave it up to the employer. Some employers like to leave the tips completely to the server and others put them in a pot and split them up; government doesn't feel it belongs in that transaction," says Fisher.As the Alberta government considers its Social Policy Framework and the ways in which to meet its target of eliminating child poverty in five years, anti-poverty advocates recommend taking another look at the minimum wage differential. In June, Public Interest Alberta and the Alberta College of Social Workers released data showing 418 900, nearly one in four Albertans, earned less than $15 an hour. And according to the Alberta Federation of Labour's numbers from its submission to the committee on the economy last year, 42 percent of low-wage earners, those earning $10 an hour, are over 25 and likely to have family responsibilities, despite the persistent perception that low-wage earners are high school students or part-time and temporary workers. According to the ACSW, the minimum wage differential is only exacerbating the income gap and is resulting in an unequal wage distribution based on gender. At the time, the new minimum wage was implemented in November 2011, Lori Sigurdson stated, "This new minimum wage legislation hits women doubly hard. Close to two thirds (64 percent) of low-wage workers are women and now that people who serve alcohol (who are mostly women) are earning less than the minimum wage, this will only make it harder for women to pay the rent and feed the kids."Currently, a person earning the minimum wage is likely living under the low-income cutoff. Statistics Canada figures show a full-time minimum-wage earner in a major city falls $6000 under LICO. Additionally, servers and restaurant workers are likely not earning the benefits of full-time union workers as, according to the Alberta government's own numbers, 95 percent of non-union employees are minimum-wage earners. According to the Alberta government over 26 000 workers earn the minimum wage.Public Interest Alberta has been advocating the province to implement a living wage. according to the ACSW, in order to earn a living wage in this city�a wage at which workers can afford the basic necessities�an average hourly amount of $16 � $17 is required. This means servers earning $9.05 would have to earn over seven additional dollars an hour through the uncertainty of receiving tips.The minimum wage in Alberta is set to change again this September, but not for those serving alcohol. This September, the formula for calculating the minimum wage will be based on annual average weekly earnings and changes to the Consumer Price Index. The general minimum wage will become $9.75 an hour, but the minimum wage for servers will remain at $9.05 until the general minimum wage becomes $10.05, at which point the two will increase with the one dollar difference. Alberta is not the only province to use the wage differential, but it currently has the third lowest minimum wage in the country.This article was published in Vue Weekly on August 1, 2012. Read the full article on the Vue Weekly website.