Restaurant chain drops plan to dip into tips to offset higher minimum wage

August 20, 2014

The St. Paul-based restaurant chain that put itself at the center of an intense public debate over Minnesota’s new minimum wage is backing away from its policy of dipping into employee tips to help foot the cost of higher pay.

The Blue Plate chain announced Wednesday that management will resume paying a credit-card processing fee it had been passing along to its minimum-wage wait staff every time someone paid their tip with plastic. Blue Plate was among the first businesses in the state to announce a plan to confront new wage costs. A Stillwater restaurant is still dealing with controversy after it started adding a 35-cent minimum-wage “fee” to customers’ bills. Other businesses have discussed slimming down staffs or cutting hours to cover higher wages they say are cutting into their bottom lines.

Acknowledging community backlash, Blue Plate’s owners, David Burley and Stephanie Shimp, also said they will hike the wages of non-tipped employees like dishwashers, prep cooks and cleaning crews.