News and Notes: If Drink Prices Rise, Here’s One Reason For It

Money $100s

I’ve had one report of drink prices at a music venue going up over the past week.  I would not be surprised if this has happened or will happen at other venues as well.

Here’s why.  The New York State minimum wage for tipped employees in the hospitality industry (restaurants, bars, etc.) rose on December 31, 2015, from $5.00 per hour to $7.50 per hour.  That’s a 50% increase.

What that means is that any tipped employee who was making less than $7.50 an hour has just gotten a raise.  It is likely that as those employees received raises, employees who were already making $7.50 an hour (or more) will also receive a raise.  Finally, any tipped employee who works more than 40 hours per week must receive at least $12.00 an hour for the hours over 40.   So any tipped employee working long hours and getting less than $12.00 an hour will see an increase in pay as well.

That drink prices, or other prices, for that matter, may rise as a result of this increase is not unanticipated.  But don’t forget that a good percentage of waiters and bar tenders out there are musicians.  So the minimum wage increase may have a positive effect on that portion of the music community.

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