Watertown Restaurants Concerned About Impact of Question 5

Local restaurants have spoken out against Question 5 on the State Election ballot, saying that if the ballot measure passes servers and bartenders would make less money, and diners would see higher prices to cover the $15 per hour wages.

Employees at Donohue’s Bar & Grill have been wearing T-shirts saying “Protect Tipped Workers: Vote No on Question 5.” Branch Line sent out a letter to customers urging them to vote no on the ballot measure entitled “Minimum Wage for Tipped Workers.” The Watertown Business Coalition and the Charles River Regional Chamber also announced they support voting No on 5.

Passage of the ballot measure has been endorsed by Progressive Massachusetts and Progressive Watertown.

According to the Secretary of the Commonwealth’s Voters Guide, if passed, Question 5 would raise the hourly wage for tipped workers to $15 per hour over the next five years. Employers would have to pay the difference between the tipped worker hourly wage and the minimum wage through the end of 2028. Any tips would be pooled and would be distributed between all workers, including non-tipped workers.

John Donohue, owner of Donohue, said that servers and other tipped workers who work an 8 hour shift are already guaranteed $15 per hour, and would likely lose money they would get from tips.

“People don’t realize (the state) already put into place … right after COVID, the base pay went from $4.25 an hour and over next 18 months went to $6.25,” Donohue said. “And, a tipped worker who doesn’t make $15 per hour, the restaurant, the diner, whoever it is, has to offset the difference and make sure they are paid $15 an hour. So, if someone only makes $100 in an 8 hour shift, then the restaurant has to reimburse another $20 to make sure they make $120.”

In its letter, Branch Line said:

“We support fair pay and good working conditions, but Question #5 threatens to do more harm than good to individual restaurant workers, independent restaurants, and the community. Increased costs will be passed onto you, and many restaurants — especially smaller, independent ones — may not survive.”

Both the Branch Line letter and Donohue said that they would be the one to make up the difference in salary, which would result in increased costs for dining.

“Many restaurants will need to raise prices by 50-100% just to cover the higher wage costs,” the Branch Line letter reads.

Donohue said restaurants are already facing smaller profit margins and higher costs due to inflation, and they will have to raise prices to cover a payroll that is almost 1.5 times higher than today. He added that Gov. Maura Healey recently came out against Question 5 in an interview with Boston Public Radio.

“We are in an area where most servers make well over $15 an hour when counting the tips,” Donohue said. “Gov. Healey talked about the average tipped employee in Massachusetts average way above the $15 per hour.”

The Watertown Business Coalition announced in its newsletter that it supports voting No on 5 after hearing from multiple members.

“We stand with our WBC member restaurants in voting NO on Question 5, in support of servers and bartenders. If Question 5 passes, it could have serious negative consequences for the restaurant industry as we know it in Massachusetts,” the newsletter reads.

The Board of Directors of the Charles River Regional Chamber, which represents Watertown, Newton, Needham and Wellesley, said that restaurants are key to the downtowns, play an important role when people and businesses look at where to locate, generate foot traffic for other businesses, provide jobs and income to suppliers, and generate local meal and property tax dollars.

“So when the owners of our independent restaurants tell us they’re worried that Question 5 (the ballot referendum that would eliminate the tipped minimum wage) could result in business closures and layoffs, we worry not just about these cherished businesses, but about other economic repercussions too.” the Chamber said in a statement.