What "The other NRA" is trying to shoot down
In the battle over raising the minimum wage, both employers and workers have plenty of skin in the game, although one industry is facing extra heat: restaurants.
No one may have more at stake than what's known as "the other NRA" -- the National Restaurant Association. That's partly because of an unusual quirk in minimum wage regulations, which stipulate that so-called "tipped" workers -- including waitstaff and bartenders -- are to be paid $2.13 an hour, compared with the federal hourly baseline rate of $7.25 an hour.
Boosting the tipped wage and the minimum wage, according to the NRA, would force restaurants to "limit hiring, increase prices, cut employee hours, or implement a combination of all three."
Yet while the NRA has the support of large restaurant chains such as McDonald's (MCD) and Darden Restaurants (DRI), it's increasingly finding itself out of step with public sentiment about the minimum wage. States and municipalities across the country are raising their base wages, even as efforts to boost the federal rate have stalled out. About 73 percent of Americans surveyed by the Pew Research Center support a higher minimum wage.
As public support and measures to boost the minimum wage have gained strength, the NRA has ramped up its lobbying spending, according to data from OpenSecrets. Last year, the organization spent $4.25 million on its lobbying efforts. That's 66 percent more than in 2014 and significantly higher than a decade earlier, when it generally spent less than $1 million annually.
The NRA is also handing out plenty of political donations. The bulk of its contributions have been funneled toward Republicans, who tend to be more open to business concerns and less supportive of workers' calls for minimum wage hikes.
"We are having a national conversation about income inequality and its impact on our broader society," said Sriram Madhusoodanan of Corporate Accountability International, which earlier this month issued a report about the NRA's influence on Congress. "It's critical to ask, 'How did we get here?' When you look at it, you see a trade association and a set of increasingly powerful corporations who have been driving this policy agenda for decades and keeping the minimum wage stagnant and stalling policy issues that people care about."
To be sure, the NRA's policy agenda includes issues other than the minimum wage, such as promoting tourism (which is good for restaurants) and supporting the federal tax deduction for food donations, which it says 83 percent of restaurants make as charitable contributions.
Even the latter issue can backfire, however. Last month, an Olive Garden server told Quartz that while she was glad the Darden-owned chain had donated more than 28 million meals to charity, she was living on food stamps and was scolded for nibbling at work.
"I got in trouble for eating some food that would just go to waste," server Kelly Ditson told the publication. "I got a verbal warning and was told that was considered stealing from the company, so I could be written up and possibly terminated if I did it again."
Lawmakers in Pennsylvania, where Ditson works, are currently debating an increase to its minimum wage, mirroring discussions and votes that have spread across dozens of other states. That has prompted the NRA to focus on influencing policymaking at the state level, says Saru Jayaraman, the co-founder and co-director of Restaurant Opportunities Centers United, a group that advocates for issues including the elimination of the tipped wage. In many cases, she said the NRA's strategy appears to be to convince lawmakers to leave the tipped wage alone.
"The NRA will not vitriolicaly oppose a minimum wage increase for everyone else as long as you leave the tipped wage," she said. Her group has noticed that the NRA is telling workers that "if the current wage for tipped workers, which is $2.13 at the federal level, goes away, then tips would go away. That's actually untrue."
NRA spokeswoman Christin Fernandez said all workers, regardless of whether they're tipped or not, are guaranteed the federal minimum wage or their state's minimum wage, if the latter is higher. While that's true, Jayaraman countered that many restaurant owners fail to make up those wages, leaving waitstaff earning below minimum wage.
"If base wages plus tips don't equal that level, it's up to the employer to make them whole. [Restaurant Opportunities Centers United] knows this but continues to perpetuate that lie," the NRA's Fernandez said.
As far as state increases to the minimum wage, Fernandez said the NRA has "openly opposed dramatic increases of $15, like what big labor is pushing" because low profit margins in the restaurant industry make it tough for higher labor costs to be absorbed.
"We pride ourselves in offering opportunity to unskilled employees of all ages and backgrounds looking to get their foot in the door," she said, "but restaurateurs simply cannot afford to keep providing that opportunity at $15 an hour."