Some restaurant owners worried about impact of new minimum wage

Minimum wage impact

PORTLAND, Maine (NEWS CENTER) --

Some restaurant owners are concerned that the minimum wage referendum which passed Tuesday night could lead to lay offs.

Starting January 1, Mainers who earn minimum wage will get $9 an hour, which will increase to $12 an hour by the year 2020.

Steve DiMillo, owner of DiMillo's Restaurant and Lounge in Portland, said this new wage system will hurt the restaurant industry, and that he may eventually resort to counter service or ordering from a tablet, because paying all of his servers a higher wage is too much of a hit to his bottom line.

"Service is going to suffer in the full service restaurants if this is not fixed," said DiMillo.

Maine's Department of Labor says there are more than 11-thousand servers in Maine, making an average of $10.79 an hour. Under the old "tip credit," workers earn half of minimum wage, $3.75, and make up the rest in tips. 
 
Steve Corman, owner of Vena's Fizz House in Portland, already pays his employees a minimum of $9 an hour. He said the new wage gives all servers financial stability.
 
"There's more to life than a dead-end job that's paying you $3.75 an hour," said Corman. "I want to keep them and raise their economic status so they don't have any stress about paying bills."
 
"It's nice to have a sense of security," said Warren Murray, Corman's bar manager.
 
DiMillo argues that a higher year-round wage does not equal the same amount that servers make in tips during Maine's busy tourism season.
 
"For six months out of the year, they're making $18 to $35 an hour," said DiMillo. "Yeah, they'd love to make a dedicated wage in the winter time, but they don't want to settle for that in the summer time."
 
DiMillo said one of the alternatives to laying off workers would be to raise menu prices, but he said that compromises his competitiveness as a business.
 
Some cities, such as Portland, have ordinances that require employers there to pay their employees certain minimum wages above the state minimum.

Copyright 2016 WCSH


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