AUGUSTA — The Legislature’s Labor and Housing Committee voted to advance a bill sponsored by Representative Scott Cuddy, D-Winterport, that would update the classification of service employees in order to address issues of wage theft.
Currently in Maine, a worker is considered a tipped employee if they make at least $30 a month in tips, and the base wage for a tipped employee can be as low as $6.08 per hour.
The threshold for being considered a tipped employee has not been significantly increased in over 50 years.
While the law currently requires employers to supplement the base wage if, after tips, an employee’s wage doesn’t meet the current minimum wage of $12.15 per hour, the Maine Center for Economic Policy found in a 2019 survey that approximately 15,000 Maine workers had experienced wage theft the previous year through an employer failing to ensure minimum wage for tipped employees, according to a news release.
As amended, LD 1489 would increase the amount of tips an employee must receive to be considered a tipped employee from $30 per month to $100 on January 1, 2022 and to $175 per month on January 1, 2023. Each year after that, this threshold will be adjusted to match the cost of living increase measured by the Consumer Price Index.
"Those who work in coffee shops, or as cleaners in hotels and offices, or others who are sometimes tipped but who do not derive the majority of their income from tips, deserve to be paid a living wage," said Cuddy. "Wage theft can happen when employers are allowed to pay this unreasonably low wage to folks who can't actually live off of what they make in tips. LD 1489 is a commonsense update to existing law that will protect Maine's most vulnerable workers."
The measure now faces votes before the full House and Senate.
Cuddy, a member of the Labor and Housing Committee, is serving his second term in the Maine House of Representatives. He represents House District 98, which includes Frankfort, Searsport, Swanville and Winterport.