State Rep. Rachelle Smit (R-Martin) issued the following statement after the Michigan Supreme Court struck down the state’s current minimum wage law, ordering the elimination of the tip credit for servers, bartenders, and other workers who frequently make more with tips than they would with a higher minimum wage:

“The consequences of this ruling can’t be overstated. Businesses will close. Workers will lose jobs. It’s plain and simple. Reduced employee hours, increased prices, a greater reliance on automation, and a move toward self-service is what’s in store for Michigan restaurants.

“It’s time for the Legislature to get a handle on this. I urge my colleagues to prioritize this issue and come together in bipartisanship to find a solution that protects Michigan businesses and restaurant workers.”

A recent survey found that 82% of Michigan restaurant servers wanted to keep the tipping system in place, and 79% worried about losing their job if the tip credit were eliminated. Another recent survey found that two-thirds of restaurant operators expected to lay off employees if the tip credit were eliminated, 94% would raise menu prices, and one in five full-service restaurants would close permanently.

###