The Structural Contexts of Low-Wage Work: Restaurant Employment Practices Across Firm Geography, Size, and Ownership Status

Abstract

This qualitative organizational case study examined how restaurant employers respond to a minimum wage mandate through human resource practices they apply to waitstaff. The author considered three contextual factors as potential correlates of such practices: restaurants' geographic location, size, and ownership. Data come from interviews with owners and managers of 15 restaurants in Washington State, home of the nation's highest minimum wage. Findings suggest that employers' discretion over working conditions shapes waiters' work schedule, and in turn take-home pay and benefits eligibility, effects partly patterned by the contextual factors. The author discusses public strategies for improving job quality given these findings.

Keywords:

• low-wage jobs
• human resource management
• organization size
• chain affiliation
• minimum wage

ACKNOWLEDGMENTS

The author wishes to thank the Harry Bridges Center for Labor Studies and West Coast Poverty Center at the University of Washington for research funding; Melissa Ford Shah, Stephanie Ewert, Danielle Fumia and staff of the Economic Opportunity Institute for research assistance; and Leann Tigges and anonymous reviewers for Journal of Poverty for comments on earlier versions of the manuscript.

Notes

1. Recruitment and training costs, also human resource outlays, were not a focus of this study.

2. To preserve chain and manager confidentiality, the firm name is given as a pseudonym and actual numbers of sites per country have been rounded.

3. In the United States, customers typically calculate tips as a percentage of the bill for the meal (generally 10% to 20%). A smaller bill thus results in smaller tips.

4. Interestingly, this owner reported not providing a health insurance option to his employees. Currently, U.S. employers are not required to provide health insurance. The owner may believe either that he is required to offer coverage to full-time workers, or that full-time workers would demand it even though not legally required.

5. The $50 per hour tip income estimated by the owner of the large urban independent site is striking in the context of a study of low-end restaurants. The restaurant's menu had pricing in the range of other establishments in the study, suggesting that the site is a very high-volume sales environment; in addition or instead, customers frequenting this site may tip more generously.