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Interior of 59er Diner

Photo: Ryan French

CASHMERE - A report by King 5 put things into perspective about how this year’s minimum wage increase is eating away at profits.

‘59er Diner owner Joe Canatta owns two restaurants that share the same name in Leavenworth and Cashmere.

Canatta told King 5 that he expects to lose $40,000 this year with the increased minimum wage. Canatta says he’s already raised menu prices twice over the course of three years to compensate for the wage increase.

“If it’s $15 for a hamburger, on their way home, people are not gonna stop at the diner because it’s just too expensive,” Canatta told King 5.

Washington’s minimum wage increased to $13.50 an hour on Jan. 1

Canatta told King 5 that he supports a raising the state’s minimum wage, but believes there’s a better alternative.

Canatta proposes applying a concept known as “tip credit.”

According to Gusto.com, a business blog, a tip credit is:

Paying tipped employees less than the minimum wage as long as tips bring their earnings up to the minimum wage threshold. If an employee doesn’t make enough in tips to reach it, then the employer has to pay the difference.

A “tip credit” is not a legal employer practice in Washington state.

Canatta says computer kiosks seen at restaurants like Applebee’s, Chili’s and Olive Garden are a growing trend in the industry and will soon take away jobs on a much larger scale.

"Those computers on the tables at every Applebee's. They're not there for looks. They're there to replace people's jobs. I'd much rather walk in and greet Flo and give Flo a hug. You can't hug a computer,” Canatta told King 5. 

In 2021, Washington’s minimum wage will reach its targeted minimum wage threshold of $15 per hour.

(8) comments

Wrango

For those that don't know, the restaurant in Cashmere is connected to a large antique store. My Wife and I frequent that antique store. We ate at this restaurant once two years ago. Once. The food is, to be as kind as possible, less than stellar. If this restaurant owner loses $40k next year, it won't be because of the minimum wage being raised. Also, these kinds of jobs, minimum wage jobs, were never meant to be a career type jobs. Minimum wage jobs are for teenagers and young adults as a stepping stone to a real career, a part time job for someone with no real job skills, not for raising a family. This is simply socialism being pushed on all of us. Next thing you know, a fry cook will be making what a brain surgeon makes.

opinionscrossroad

Fry cook making what a Brain Surgeon makes??

As the late Jackie Gleason said, "That's nothing but pure and simple old fashioned COMMUNISM" which this state seems heck bent on pursuing (and suing of course)..

Cheburashka

Because if someone says it in a comment on IFiber, it must be true. A brain surgeon earns just shy of $300 an hour on average. Do you really think restaurant servers are close to that?

Locally grown

I have grown up in the area where this restaurant is located I personally know and have met on many occasions the owner. Frankly I'm not surprised he is complaining about the raise in minimum wage. Just about everybody here locally knows Joe treats his staff horribly. He goes through employees like nobody I've ever seen. Living here locally my entire life I can say that many locals myself included do not even like to frequent his establishment.

GrantCitizen

ON a side note, the fact that waitstaff have to get minimum wage in WA means that I don't have to tip to make up for their low wages (i.e., tip credit). No more implied guilt about being a 10+% tipper because the waiter is getting below minimum wage!

Cheburashka

I've never understood the need to escalate the percentage a server is tipped. I grew up in the 10% era and did most of my dating and dining out in the 15% era. I don't get the push for 20% now. A percentage is a percentage. I hate to admit it, but I agree with your reasoning here. If the wage has gone up, it would seem that the percentage of tip can reasonably go down.

Sarabie

If this happens that will affect delivery drivers as well. I deliver pizzas and use my own car to deliver. That delivery fee you get charged does not go to the driver. We get gas reimbursement of 35 cents a mile. So if I don't get tipped I literally can not continue to deliver pizzas. The wear and tear on my vehicle is outrageous and there is no way anyone that drives their own vehicle will be able to continue doing so.

opinionscrossroad

Funny Article!!

Why should this guy because he owns a restaurant be allowed to lower his minimum wage for the Waitresses (or waiter) just because a patron tips for good service?? When I tip someone for good service, I am tipping THEM, not the restaurant or attempting to get the restaurant out of their required obligations.. I am tipping a waiter or waitress for them going beyond normal service!!!

As far as him complaining about the effects of the Minimum wage, while I do not support the Minimum Wage trying to be a "livable wage" because this economically is impossible to do, it doesn't really matter either.. People will continue to pay..

If businesses want to stay competitive they will just automate and eliminate the employee positions and replace the low wage jobs with other avenues.. There are benefits to higher wages and there are downsides..

To the people that say " I will never use a system that takes away a person's job " .. It's just what people get used to.. I look at Amazon (how many local jobs did this service take because you do not want to go to town and pay a higher price)? I look at Wal-mart, Winco, Safeway, and McDonalds using self check out (used to be very few people used them and even avoided them NOW the self Check out lines are sometimes longer than the lines with a Cashier) People will get used to eliminating certain positions and going with faster and cheaper options.. It just takes time and businesses will have to do it to eliminate the costs and expenses of having employees if other options are available..

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