A $40 cheeseburger, a salmon Caesar salad for over $50, and a wage increase of hundreds of thousands of dollars are just some of the concerns business owners and industry associations are raising as they discuss the wage increase approved by the Michigan Supreme Court last month.
The ruling, which takes effect in February, will increase the state’s minimum hourly wage and establish a new standard for paid sick leave for workers. Michigan’s new minimum wage is expected to be about $12.50 in February and rise over the years until it reaches about $15 in 2028. The minimum wage for tipped workers is currently $3.93 and will likely rise to $6 an hour.
While groups like One Fair Wage see an increase in the minimum wage and minimum wage for tips as a good thing for workers, many business owners in Metro Detroit say the wage increases will force them to raise menu prices to cover the additional labor costs. Opponents of the ruling say higher menu prices, possible service charges to cover costs and informing the public that servers will receive higher wages will result in restaurants not being able to make ends meet and servers and bartenders receiving fewer tips.
More: Read the Michigan Supreme Court’s decision on minimum wage
The group Save MI Tips hosted a discussion Friday morning and invited members of the media to the Townhouse restaurant in Birmingham to hear why they are fighting the 4-3 ruling. Members of the Michigan Restaurant Lodging Association, local lawmakers and business owners spoke to a small group of other Birmingham business owners, area restaurant workers and members of the media about why they are fighting the impending change.
Service workers were encouraged to inform their colleagues and contact their government representatives to share what they believe the reality will be if the minimum wage is increased: less tips. The conversation was not only about the impact of the laws in 2025, but also how they might change restaurant culture over time.
Brian Williams, a bartender at Buffalo Wild Wings in Lake Orion, was at the Birmingham gathering Friday morning. He said one of his biggest concerns is that some lawmakers have been fighting these types of laws for a decade, but service workers like him don’t know what to expect.
“I think I’m most concerned about how quickly this happened and how little we all knew about it,” he said. “I only found out about it three weeks ago, and there was a regular sitting in my bar and he said, ‘Hey, you know what just got passed?’ I personally find it kind of scary that things are just being steamrolled through like that.”
Another Buffalo Wild Wings bartender, Kacey Mullins of Auburn Hills, was also in attendance Friday morning. She opposes the pay increase for tipped employees because she herself now makes much more than minimum wage and enjoys the flexibility to earn more money by working an extra shift or two when she has a big expense like a car repair.
“Waiters, bartenders, we make more than minimum wage… Honestly, I don’t even know what the minimum wage is for waiters and bartenders right now,” she said. “People aren’t going to tip if they know I make as much as (people who) work in a kitchen or warehouse, and I think that’s what makes people not want to work as bartenders or waiters anymore.”
“I have a lot of regulars who just come in to sit down and tip. But if people aren’t getting what they used to get, the service isn’t good,” says Mullins, who has been a bartender for 10 years and moved to Michigan from Ohio specifically for the better job opportunities.
“I hope to take some of these flyers home and stay in touch with my clients by calling our congressman and then honestly spread the word so people can learn more about it,” she said, adding that she believes those advocating for higher wages mean well but that they don’t understand what it’s actually like to work for tips.
“I feel like people think it’s beneficial. It’s well-intentioned, but it’s the good intentions of people who have never worked in the industry and so don’t fully understand it.”
John McNamara, vice president of government affairs for the Michigan Restaurant and Lodging Association, reported on what has happened in other parts of the country where similar laws have been passed, such as Washington, DC.
“In Washington, D.C., you can get a salmon Caesar salad for $60,” he said, because they’ve eliminated tipping (the lower wage for tipped workers). Just across the river in Alexandria, Virginia, however, restaurant prices are lower. “It’s a 15-minute subway ride and there are plenty of upscale restaurants… you just see working waiters saying, ‘That’s OK, I’ll just go work in Alexandria. I’m going to Baltimore.'”
McNamara also painted a picture of what the new paid sick leave would look like for business owners. He said the new law would allow workers to take up to three sick days without a doctor’s note. That means workers could simply not show up for a scheduled shift and still get paid just because they say they’re sick. The MRLA hopes to work with lawmakers to enact some sort of “guardrails” or work with companies that already have a viable paid sick leave plan in place.
According to the MRLA’s findings, 94 percent of restaurants will have to raise their prices by up to 25 percent, and 83 percent of waiters surveyed would prefer the status quo of a wage of $3.93, supplemented by tips from customers.
Other groups cheered on July 31 when the ruling was announced, most notably One Fair Wage, a national organization of nearly 300,000 service sector workers demanding an increase in all wages, including sub-minimum wages for tipped workers. They even held a celebration at the Yum Village restaurant in Detroit on July 31 when the Michigan Supreme Court’s ruling came down.
“This is a great day for the more than 494,000 workers in Michigan who are getting a raise,” said Saru Jayaraman, president of One Fair Wage, in July. “We have finally prevailed over the corporate interests that have tried everything to prevent all workers, including restaurant workers, from getting a full, fair wage with tips.”
The organization Save MI Tip is planning a rally with industrial workers at the Michigan Capitol on September 18.
