A minimum wage fee is hitting customers at a small Minnesota café trying to keep up profits despite the new minimum wage law that took place Aug. 1.
Oasis Café owner Craig Beemer is charging customers a minimum wage fee of 35 cents to each bill to help the café afford the 75 cent increase mandated by Minnesota.
"[Beemer] wants people to be aware we're a small business and we're trying to stay open," Beemer said to Star Tribune, adding that when the café was making this decision, they considered transforming the restaurant to a fast-food-style restaurant without servers to make ends meet. "If you raise prices and don't tell anyone, that seems more backhanded to me."
The restaurant is being nationally questioned after a customer's picture of the receipt went viral.
Under the tax on the receipt is a minimum wage fee of 35 cents with an asterisk next to it. The bottom the receipt reads, "min wage fee is a charge to offset a state increase of minimum wage for tipped employees."
The minimum wage increase will cost Beemer an extra $10,000 a year, according to Watch Dog reports.
In the U.S., 43 states have tip credit laws where restaurants can pay servers less than minimum wage if they can prove they make minimum wage after tips. Minnesota is not one of those states.
Wade Luneburg of the MN State Council of UNITE HERE Unions believes the restaurant industry is overreacting to the mandatory minimum wage increase.
"Putting [minimum wage] fees on tickets and passing the cost on to consumers directly is strange at best, and creates an 'us against them' mentality while ordering dinner," he tells Star Tribune.
