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Primar Researc Support Proided bTed Smuler, De Paul UniersitLaNsa Adams, Restaurant Opportunities Centers United

Editorial Support Proided B Nirupama Jaaraman

Desin b Cristoper Caput

Februar 9, 2010

Fundin Proided B:Cicao Foundation or WomenTe Ford FoundationTe Woods FundTe Cicao Communit Trust

By the Restaurant Opportunities Center o Chicago, the Restaurant OpportunitiesCenters United, and the Chicagoland Restaurant Industry Coalition

Behind the Kitchen Door:The Hie Csts f Tkig the Lw R iChicgl’s Thriig Restrt Istr




Primar Researc Support Proided bTed Smuler, De Paul UniersitLaNsa Adams, Restaurant Opportunities Centers United

Editorial Support Proided B Nirupama Jaaraman

Desin b Cristoper Caput

Februar 9, 2010

Fundin Proided B:

Cicao Foundation or WomenTe Ford FoundationTe Woods FundTe Cicao Communit Trust




Executive Summary

i

Executive Summary

Behind the Kitchen Door: Pervasive Inequality in Chicagoland’s Triving Restaurant Industry was conceived o and

designed by the Chicagoland Restaurant Industry Coalition - a broad gathering o academics, policy analysts, workeradvocates, worker organizers, unions, restaurant workers and restaurant industry employers. Tis report representsone o the most comprehensive research analyses o the restaurant industry in Chicago.

Te report uses data rom 582 worker surveys, 29 one-hour interviews with restaurant workers, and 31 one-hour in-terviews with restaurant employers in Chicago. Te results o this primary research are supplemented by analysis o industry and government data, such as the Census, as well as a review o existing academic literature.

Our study was inspired by the need or examination and analysis o the overall health o the restaurant industry, which is undamental to Chicago’s economy and critical to the lives o thousands o restaurant workers and em-ployers. Te restaurant industry is an important and growing source o locally based jobs, and provides considerableopportunity or the development o successul businesses. It is thereore essential to make inormation about theindustry rom the perspectives o both workers and employers available to all stakeholders to ensure the industry’s

sustainable growth.

A Resilient and Growing IndustryChicago is home to a vibrant, resilient, and growing restaurant industry. Te industry includes approximately 9,000ood service and drinking places that make signicant contributions to the region’s tourism, hospitality and enter-tainment sectors and to its economy as a whole. In act, Chicago has the second largest restaurant industry in thenation.

Perhaps the industry’s most important contribution to the region’s economy is the thousands o job opportunitiesand career options it provides. In 2008, the gross domestic product by metropolitan area rom the accommodationsand ood services sector was $12.7 billion. Since 1995, employment growth in the ood services sector has outpacedthat o the Chicago region overall. Restaurants employ almost 140,000 workers in Cook County alone and almost

250,000 workers in Chicagoland – 6.8% o the region’s total employment. Since ormal credentials are not a require-ment or the majority o restaurant jobs, the industry provides employment opportunities or new immigrants, whoseskills and prior experience outside the United States may not be recognized by other employers, workers who haveno ormal qualications, and young people just starting out in the workorce.

Many Bad Jobs, A Few Good Ones Tere are two roads to protability in the Chicago restaurant industry – the “high road” and the “low road.” Res-taurant employers who take the high road are the source o the best jobs in the industry – those that provide living

wages, access to health benets, and advancement in the industry. aking the low road to protability, on the otherhand, creates low-wage jobs with long hours, ew benets and exposure to dangerous and oten-unlawul workplaceconditions. Many restaurant employers in the Chicago area appear to be taking the low road, creating a predomi-nantly low-wage industry in which violations o employment and health and saety laws are commonplace.

While there are a ew “good” restaurant jobs in the restaurant industry, and opportunities to earn a living wage, themajority are “bad jobs,” characterized by very low wages, ew benets, and limited opportunities or upward mobil-ity or increased income. According to the U.S. Bureau o Labor Statistics, the median wage or restaurant workersis only $8.86, compared to a median wage o $17.28 or all workers in Chicago.

In our own survey o restaurant workers, the vast majority (90.5%) reported that they do not have health insurancethrough their employers (see urther Chapter III: Workers’ Perspectives). Earnings in the restaurant industry havealso lagged behind that o the entire private sector. In terms o annual earnings, restaurant workers on average madeonly $17,844 in 2008 compared to $55,409 or the total private sector.



Executive Summary

ii

A majority o workers in our study reported overtime and minimum wage violations, lack o health and saety train-ing, and ailure to implement other health and saety measures in restaurant workplaces. Almost one-third o the

workers surveyed in our study (32.6%) experienced overtime violations and 28.5% reported working “o the clock” without being paid.

Workers o color are largely concentrated in the industry’s “bad jobs,” while white workers tend to disproportion-ately hold the ew “good jobs.” Workers o color also reported discriminatory hiring, promotion and disciplinary practices: 21.8% o all workers reported being passed over or a promotion, or receiving less pay than another in thesame position and 42.8% o those workers elt that the unequal treatment was based on race (see urther ChapterV: Segregation & Discrimination).

The Social Costs o Low-Wage JobsOur research also reveals the “hidden costs” to customers and taxpayers o low-wage jobs and low road workplacepractices. Violations o employment and health and saety laws place customers at risk and endanger the public. Forexample, restaurant employers who violate labor laws are also more likely to violate health and saety standards inthe workplace – such as ailing to provide health and saety training, or orcing workers to cut corners that harm thehealth and saety o customers (see urther discussion in Chapter VI: Te Social Cost o Low-Wage Jobs).

Te pervasiveness o accidents coupled with the act that so ew restaurant workers have access to benets such aspaid sick days and health insurance have negative impacts on workers as well as consumers and taxpayers. 96.2%o all workers surveyed reported not having access to paid sick days, and 75.9% reported working while sick. In ad-dition, 90.5% reported not having access to employer-provided health insurance, which can lead to escalating un-compensated care costs incurred by public hospitals. For example, 15.8% o surveyed workers reported that they ora amily member had visited the emergency room without being able to pay or their treatment.

Finally, low wages and lack o job security among restaurant workers lead to increased reliance on social assistanceprograms, which results in indirect subsidies to employers who are engaging in low road practices. A key nding o our research is that whenever restaurant workers and high road employers are hurt by low road practices, so is therest o society.

The High Road Is PossibleIt is possible to create good jobs while maintaining a successul business in the restaurant industry. Our interviews

with employers revealed that as long as there is an enduring commitment to do so, it is possible to run a successulrestaurant business while paying living wages, providing benets, ensuring adequate levels o stafng, providingnecessary training, and creating career advancement opportunities.

In act, 22.3% o the workers we surveyed reported earning a living wage, and similar numbers reported receivingbenets, thereby demonstrating both the existence o “good jobs” and the potential o the industry to serve as a posi-tive orce or job creation. Workers who earn better wages are also more likely to receive benets, ongoing trainingand promotion and less likely to be exposed to poor and illegal workplace practices. For example, workers earning$16.48 per hour were also much more likely to have health insurance than workers earning less than the minimum

wage o $7.75 per hour.



Executive Summary

iii

Our Recommendations Te Chicagoland Restaurant Industry Coalition recommends the ollowing steps to address the workplace problemsdocumented in our study:

1. Level the playing feld by providing paid sick days and increasing the tipped minimum wage. Policymakers should require all employers to provide paid sick days to their employers, and raise theminimum wage or tipped workers to be closer to the minimum wage or all other workers. Te lack o paid sick days can result in public health challenges or the entire region.

2. Incentivize high road practices. Initiatives and incentives should be considered to assist and encourageemployers to provide living wages, basic health care benets, and advancement opportunities to restaurant

workers. Such initiatives could include rent and property tax incentives or employers who implementstellar workplace practices, and subsidies to employment-based health insurance or support o collectivehealth insurance provisions across the industry.

3. Promote opportunity, penalize discrimination. Policy makers should explore initiatives that encourageinternal promotion and discourage discrimination on the basis o race and immigration status in therestaurant industry.

4. Labor, employment and health and saety standards should be strictly enorced. Employers mustbe educated about their legal responsibilities towards their employees concerning health and saety standards. Agencies should provide employers with the necessary support to observe their obligations totheir workers and to the public. It is in the interest o both workers and the public at large that existingstandards be observed and enorced.

5. Promote model employer practices. Model employer practices should be publicized to provide much-needed guidance to other employers in the industry. Te vast majority o employers we interviewed agreedin theory that high road workplace practices were better. However, many did not appear to implementthem in practice.

6. Allow workers the right to organize. Barriers to organizing restaurant workers should be addressed. Tepublic benets o unionization in this and other industries should be publicized as signicant benets to

workers and employers.

7. Support urther industry research. Further study and dialogue should be undertaken that includesthe perspectives o restaurant workers, employers, and decision-makers. Such dialogue can helpensure eective and sustainable solutions to the issues identied in our study – especially race-baseddiscrimination, and the impacts o the industry’s practices on health care and public program costs.

Te inormation collected here rom workers, employers, and industry experts is critical to ensuring that the Chicagometropolitan area’s restaurant industry truly shines as not only an important contributor to the region’s job marketand economy, but also to the well-being o its workers and communities.



ExECuTIvE SummaRy i

CHapTER I: INTRODUCTION & METhODOLOgy 1

CHapTER II: OvERvIEW OF ChICAgOLAND’S RESTAURANT INDUSTRy 4

CHapTER III: WORkERS’ PERSPECTIvES 12

CHapTER Iv: EMPLOyERS’ PERSPECTIvES 24

CHapTER v: SEgREgATION & DISCRIMINATION 36

CHapTER vI: ThE SOCIAL COST OF LOW-WAgE JOBS 48

CHapTER vII: CONCLUSIONS & POLICy RECOMMENDATIONS 54

appEndIx & EndnoTES 56


© Coprit 2010 Restaurant Opportunities Centers United (ROC-United)

Table o Contents



Chapter I

1

C h A P T E R I

Introduction and Methodology

Te Chicago restaurant industry has enormous potential, both as an employer and as an engine of economicgrowth. Over the past twenty years, the ood and beverage service sector has expanded, and despite the recent eco-nomic downturn, it continues to outpace other industries.1 Unlike many jobs in the manuacturing and technology sectors, restaurant jobs cannot be outsourced. For this reason, they are anticipated to occupy an ever larger share o the region’s economy in the near uture.

ABOUT THIS STUDY

Tis study was conceived and designed by te CicagolandRestaurant Industr Coalition - a broad aterin o academics,policy analysts, worker advocates, worker organizers, unions,restaurant worers and emploers.

Data were collected rom 582 worer sures, in-dept interiewsand ocus roups wit 29 restaurant worers, and 31 interiewswit restaurant industry employers in Cook County, collectedoer a one-ear period. Te results o tis primar researc aresupplemented by analysis o secondary industry data and areiew o existin academic literature.

Tis project was inspired by te need or examination andanalysis o te overall ealt o an industry increasingly in itsimportance to Cicago’s economy and critical to te lives o tousands o restaurant worers and emploers. Te restaurantindustry is an important and growing source o locally based

jobs and provides considerable opportunity or developmento successul businesses. It is tereore essential to makeinormation about te industry rom te perspectives o botworkers and employers available to all stakeolders to ensurete industr’s sustainable rowt.

Te region’s restaurants are an important source o jobs – particularly or people o color, new immi-grants and young people just starting in the work-orce.2 Tousands o Chicagoland restaurant work-ers earn living wages and receive health carebenets. Te industry also oers opportunities or

joining the ranks o the many entrepreneurs whohave ullled their dream o opening their own res-taurants. Most jobs in the industry, however, arecharacterized by low wages - sometimes below poverty level – no health insurance, no sick and va-cation days, ew advancement opportunities, andexposure to poor and illegal workplace conditions.

Our primary research, review o existing literature,and analysis o government and industry data re-

veal that there are two roads to protability in theChicago restaurant industry – the high road andthe “low road.” Restaurant employers who take the

high road are the source o the best jobs in the in-dustry – those that enable restaurant workers tosupport themselves and their amilies, remainhealthy, and advance in the industry. aking the

low road to protability, on the other hand, creates low-wage jobs with long hours and ew benets. It ultimately harms workers, other restaurant employers, consumers, public health, and taxpayers.

Our research and existing government and industry statistics indicate that the majority o employers in Chicago’srestaurant industry, like employers in other parts o the country, are employing low road workplace practices, con-tributing to the creation and perpetuation o a predominately low-wage industry in which ew workers enjoy basic

workplace benets and sae and healthy working conditions. Tese practices oten lead to violations o workers’ basicrights, as well as ederal and state wage and hour laws and health and saety regulations. As a result, as the restaurant

industry creates jobs, it has the potential to create jobs that al low workers to support their amilies, but oten insteadends up contributing to the prolieration o “bad” jobs in the current economy – jobs that cannot sustain workers,their amilies, and our communities. Our worker surveys and interviews illustrate the impacts such bad jobs haveon people’s lives.

Our interviews with employers highlight many o the actors that drive them to take the low road to protability,oten against the principles o good business practice they espouse, as well as strategies employed by some restau-rant employers to overcome these actors. It is possible to achieve success in the restaurant business by pursuing the“high road,” but employers’ ability to do so is undermined by pervasive use o low road workplace practices, creatingan unlevel playing eld. Our research also demonstrates the importance to public health – and public coers – o encouraging and supporting the majority o restaurant employers to improve practices.



Chapter I

2

TERMS USED IN THIS REPORT

“Front o te house” and “Back o te house” reer to

restaurant industry terms or te placement and unction o workers in a restaurant setting. Front o te ouse generallyrepresents tose interactin wit customers in te ront o terestaurant includin wait sta, bussers and runners. Bac o teouse worers enerall reer to itcen sta includin ces,coos, ood preparation sta, diswasers and cleaners.

“hig road” and “low road” are industry terms reerring toopposing business strategies or acieving productivity andproftability. In tis report, “ig road” is used to denoteemploer practices tat inole inestin in worers b painliin waes, proidin compreensie benefts, opportunitiesor career advancement, and sae workplace conditions as ameans to maximize productiit. Te results o suc i roadpractices are oten reduced turnover as well as quality oodand better serice. “Low road” reers to strateies tat inolecronic understafng, ailing to provide benefts, pusingworkers to cut corners, and violating labor laws, and ealtstandards.

In our research, we also ound a high degree o sep-aration – and racial disparity – in wages and workingconditions between white workers and workers o color in the Chicago restaurant industry. Our re-search suggests at least two key actors contributingto these disparities: (1) racial segregation by occupa-tion or position; and (2) racial segregation by indus-try segment. High levels o racial segregation by oc-cupation are demonstrated by the divide betweenthe “ront o the house” workers, such as servers andbartenders with whom diners interact, and those

who remain hidden in the “back o the house.” Res-taurant workers in the “ront o the house” generally receive higher wages, better working conditions,training, and advancement opportunities than thosebehind kitchen doors. Te majority o white workersin the Greater Chicago restaurant industry are em-

ployed in ront o the house positions. Workers o color are largely concentrated in the back o thehouse – in the lowest paid jobs requiring the longesthours, eaturing the greatest health and saety haz-

ards, and oering the ewest advancement opportunities. In addition to these disparities, restaurant workers wespoke with reported experiencing high levels o verbal abuse, excessive discipline, and barriers to promotion they believed to be based on race and immigration status. Patterns o segregation that resulted in dierences in wages andemployment opportunities were also apparent in the industry segments which employ Chicago restaurant workers.

White restaurant workers were signicantly more likely to be employed in ne dining establishments, whose pricepoints oer the highest concentration o living wage jobs in the industry. By contrast, Arican-American workers

were much more likely to be employed in the lower-paying quick-service segment o the industry.

Tis report includes the perspectives o both high road and low road employers, the experiences o workers, govern-ment and industry data, and academic research. In eect, we have created a unique and rich source o inormationon the metropolitan area’s restaurant industry to help guide eorts to end discriminatory workplace practices, andpromote the high road business model to serve as a positive engine o economic growth in Chicago.



C h A P T E R II

Overview o Chicagoland’sRestaurant Industry



Chapter II

4

C h A P T E R II

Overview o Chicagoland’s

Restaurant IndustryA. A Signifcant and Growing Industry

Te restaurant industry is increasingly signicant or Chicago, especially as manuacturing jobs decline. Food services and drinking places are one o Illinois’ largest employers. 3 Te tourism industry, which includes the restaurantindustry, is now considered one o Chicago’s largest and astest-growing industries.4 Cook County is home to ap-proximately 9,500 ood services and drinking places, a number that grew substantially in the 1990s, and is expectedto keep growing.5

Te restaurant industry is a key contributor to Chicagoland’s tourism and hospitality sectors, and to the economy as a whole. In 2008, the gross domestic product by metropolitan area rom the accommodations and ood services sector

was $12.7 billion.6

Te restaurant industry makes up over 70% o the accommodation and ood services sector, andhas an annual average growth rate o 5% in millions o dollars contributed to the local economy.

Although considerable skills are needed to work in this industry, no ormal credentials are generally required, mak-ing restaurants a particularly viable source o employment or workers who have not had the opportunity to pursueormal training. Restaurant employment also serves as an important entry point into the job market or new immi-grants to the United States, whose credentials and experience abroad are oten not recognized by other employers.

B. How Many Jobs?As indicated in able 1, the “Food Services and Drinking Places” sector provides almost 250,000 jobs per year in theChicago metropolitan area (hereater “ood services sector”), and more than 171,000 jobs in Cook County alone.7 Inact, the ood services sector contributed to 73% o employment in the “Leisure and Hospitality” supersector. 8 Te

restaurant industry has been one o the largest and astest-growing sectors o the Chicago economy, second only tothe government and healthcare. Now, the ood services sector employs more people than a wide variety o both oldand new economy industries such as nance, securities, and construction.9

TABLE 1: Employment in the Food Services Sector and Other Select Industries,Chicagoland, 2009

Industry Employment ( in 1000s) Share o Total Employment

Total Division Non-arm Employment 3692.9 100.0%

Health Care and Social Assistance 413.7 11.2%

Leisure and Hospitality 341.9 9.3%

Manuacturing 331.1 9.0%

Food Services and Drinking Places 249.9 6.8%Hospitals 148.4 4.0%

Construction 149.9 4.1%

Source: Bureau o Labor Statistics, Current Employment Statistics, July 2009In this table, Chicagoland reers to the Chicago-Naperille-Joliet, IL Metropolitan Diision which includes Cook, DeKalb, DuPage,Grundy, Kane, Kendall, McHenry and Will countiesNote: Industry Categories are not mutually exclusie

Te restaurant industry has the potential or providing low-wage workers with access to advancement to jobs that will allow them to support their amilies. Tis is evidenced by the act that the industry is growing and there are liv-ing wage jobs. From our survey data, 12.3% o all workers surveyed reported an hourly wage o $18.31 or higher.



Chapter II

5

Since 1992, employment growth in the ood services sector has outpaced that o general employment in Chicago-land. 10 Figure 1 depicts employment growth in the ood services sector rom 1990 to 2008, compared to job growthin the overall region. Even during the current economic crisis, the restaurant industry has not nearly suered thekind o job loss locally or nationally experienced by the economy as a whole. From January 2008 until December2008, the economy as a whole experienced a 3.5% job loss, while the restaurant industry experienced 2.3% job loss.11 Even as late as December 2007 in Chicago, while the rest o the regional economy was experiencing serious decline,the restaurant industry continued to experience growth (see Figure 1). Since the beginning o the recession in De-cember 2007, manuacturing and construction job losses have accounted or the overwhelming majority o the jobloss in the entire state.12

0.9

1.2

1.5Food Services & Drinking Places

Total Division Employment

2 0 0 8

2 0 0 7

2 0 0 6

2 0 0 5

2 0 0 4

2 0 0 3

2 0 0 2

2 0 0 1

2 0 0 0

1 9 9 9

1 9 9 8

1 9 9 7

1 9 9 6

1 9 9 5

1 9 9 4

1 9 9 3

1 9 9 2

1 9 9 1

1 9 9 0

1 9 9 0

= 1 . 0

0

FIGURE 1: Job Growth in Food Services and Drinking Placesand Total Employment, Chicagoland, 1990-2008

Source: Bureau o Labor Statistics, Current Employment Statistics, July 2009Note: Chicagoland reers to the Chicago-Naperille-Joliet, IL Metropolitan Diision which includes Cook, DeKalb, DuPage, Grundy,Kane, Kendall, McHenry and Will counties.

C. What Kind o Restaurant? Te ood services sector includes our distinct industries: ull-service restaurants, limited-service eating places, spe-cial ood services and drinking places.13 Te restaurant industry generally includes the rst two o these categories;namely, ull-service restaurants and limited-service eating places. Although the Census does not distinguish be-tween dierent types o ull-service restaurants, we see both ‘ne dining’ restaurants and ‘amily-style’ or ‘ranchise’restaurants alling within this category. Limited service restaurants are also known as ‘quick serve’ – restaurants thatdo not oer waiter service.

able 2 details employment levels or each o these two types o restaurants between 1990 and 2008. Over this pe-riod, employment growth in ull-service restaurants outpaced that o other parts o the industry, increasing its shareo industry-wide employment.



Chapter II

6

Witin ull-serice restaurants and limited-serice eatin places, we ae identifed tree eneral sub-sements o te restaurantindustr wic are presentl not specifed in oernment data, but were most useul or understandin te arin practicesand strateies used b indiidual businesses.

Fie iig, r wht is cl referre t s “-tbleclth” restrts;1.

Fil-stle restrts, ls escribe s “csl iig,” iclig bth frchise r chi restrts sch s olie2.Gre r alebee’s, sller estblishets, freqetl eighbrh-bse /r ethic restrts;

Fst-f r “qick-sere” restrts.3.

We also ound trou te interiews wit emploers tat worplace practices are drien b actors suc as weter a restaurantis part o a otel, a larer corporation, cain or roup and ow man oter restaurants te owner as, i an. We ound tat temajorit o te fne dinin restaurants are part o restaurant roups or are one o multiple (tree or more) restaurants under tesame owner. Non-rancise, amil-stle restaurants are oerwelminl sinl owned or one o two restaurants owned b tesame part. Tese trends ad proound impacts in terms o emploers’ power, or lac tereo, to defne standards and policiestat aect teir business and buin power, wic is a e component o teir competitieness and proftabilit in te industr.

TABLE 2: Restaurant Industry Employment, Chicagoland,1990 and 2008 (In thousands)

Year Full-Service Restaurants Limited-Service Eating Places

Restaurant Industry Employment, 1990 84.3 65.2

Restaurant Industry Employment, 2008 117.9 96.6

Change in Employment, 1990-2008 33.6 31.4

Percentage Increase in Employment, 1990-2008 18.05% 16.86%

Share o Food Services Sector in 1990 45.27% 35.02%

Share o Food Services Sector in 2008 46.88% 38.41%

Source: Bureau o Labor Statistics, Current Employment Statistics

In this table, Chicago Metropolitan Area reers to the Chicago-Naperille-Joliet, IL Metropolitan Diision which includes Cook, DeKalb,DuPage, Grundy, Kane, Kendall, McHenry and Will counties

D. Where are the Jobs? While the restaurant industry is widespread throughout the seven counties that comprise what is known as Chica-goland, this report ocuses on Cook County. As indicated by the data contained in able 3, Cook County accountsor more than two thirds (67.5%) o the Chicagoland’s employment in ull service restaurants, and almost two thirds(64.4%) o the state’s limited service eating places.



Chapter II

7

TABLE 3: Employment by County in the Restaurant Industry, Chicagoland, 2007

Full Service Employees Limited Services Employees

Chicagoland Total 100.00% 100.00%

Cook 67.49% 64.40%

DuPage 15.31% 14.21%

Will 6.18% 8.27%

Kane 5.47% 6.24%

McHenry 3.49% 3.37%

DeKalb 0.94% 1.67%

Grundy 0.50% 0.64%

Kendall 0.62% 1.20%

Source: U.S. Census Bureau, County Business Patterns 2007

E. Who Gets the Jobs?Most jobs in the restaurant industry do not require much ormal education, and, with the exception o ches andsommeliers, employers generally do not require workers to have educational degrees or vocational certication. Tisis not to say that restaurant workers do not have skills or that restaurant work is not demanding. Back o the house

workers, oten working in hot, cramped workspaces, must be able to complete the tasks required to accurately llorders in a timely and quality ashion in a high pressure environment. Front o the house sta and other employ-ees who interact with customers need strong interpersonal skills, time and task management skills, and a workingknowledge o ood preparation and presentation.

Te industry is consequently an important source o jobs and income or large numbers o new workers who do nothave ormal training or are new to the workorce. Te industry is also a source o employment or women, youth,people o color and immigrants – particularly new immigrants, whose prior education and experience abroad is oten

not recognized by employers in the U.S.

F. What are the Characteristics o the Workorce? Te Chicago restaurant industry is extraordinarily diverse, with no majority ethnic group, substantial immigrantpopulations, and almost equal numbers o men and women. Whites, Latinos, and Arican-Americans comprise thelargest racial groups in the industry, with substantial numbers o Asian American workers as well. Te industry isalso airly diverse in terms o age.

Not much has changed in terms o the industry’s demographics rom 2000 to 2008. Te most dramatic dierence inrestaurant worker characteristics during this period was an increase in educational levels among restaurant workers-ewer workers with less than a high school education, and more workers with high school and bachelor’s degrees.

Tere has also been a slight (4%) increase in the proportion o Latino workers in the industry, and an equivalent

decrease in the proportion o black workers. Tere has also been a slight increase in the proportion o workers whospeak English very well.

Compared to the overall Cook County workorce, Chicago restaurant workers are more diverse. Te restaurant workorce has a higher percentage o Latino and mixed race individuals than the overall Cook County workorce.Restaurant workers are also more likely to be immigrants and non-native English speakers, and less likely to havea college education.



Chapter II

8

TABLE 4: A Demographic Prole o Cook County Restaurant Workers,2000-2008 (column percentages)

Restaurant Workers 2008 Only

2000 2008Dierence

(2008-2000)

All Cook

County Workers

Dierence (Restaurant

Workers – All Workers)Gender Male 52.7 52.1 -.6 51.4 0.7

Female 47.3 47.9 .6 48.6 -0.7

Age 16-24 38.6 35.6 -3 14.7 20.9

25-44 42.5 43.6 1.1 44 -0.4

45-64 16 18.3 2.3 35.4 -17.1

65 and older 2.9 2.4 -.5 6 -3.6

Race/Ethnicity Non-hispanic Wite 37 37.8 .8 49.3 -11.5

Non-hispanic Blac 21.8 17.8 -4 22.2 -4.4

Asian 6.9 6.8 -1 6.4 0.4

hispanic/Latino an race 32.2 36.1 3.9 21 15.1

2 or more races and Oter 2.1 1.5 -.6 1.2 0.3

Nativity Citizen b Birt 63.5 63.6 .1 73.5 -9.9

Forein Born 36.5 36.4 -.1 26.5 9.9

World area o Birth

US 63 62.8 -.2 72.8 -10

Latin America 24.4 25.1 .7 13.1 12

Asia 7.3 7.2 -.1 6.3 0.9

Europe 4.7 4.5 -.2 6.7 -2.2

Arica 0.5 0.2 -.3 0.7 -0.5

Oter 0.1 0.1 0 0.3 -0.2

Years in US Born in te U.S. 62.2 62.6 .4 72.1 -9.5

0-5 11.1 6.7 -4.4 3.7 3

10-Jun 8.1 7.3 -.8 5 2.3

15-No 6 6.8 .8 4 2.8

16-20 4.7 6.8 2.1 3.9 2.9

21 or more 7.9 9.9 2 11.4 -1.5

Ability to SpeakEnglish

Speas er well 37.5 45.4 7.9 53.2 -7.8

Speas well 25.5 20.5 -5 21.9 -1.4

Speas, but not well 26.3 26.2 -.1 19 7.2

Does not spea Enlis 10.7 7.9 -2.8 6 1.9

Education Less tan hi Scool 43.3 28.3 -15 14.1 14.2

hi Scool Deree 25.7 31.4 5.7 22.7 8.7

Some Collee 22.4 27.9 5.5 28.8 -0.9

Bacelors Deree and hier 8.6 12.4 3.8 34.4 -22

Source: U.S. Bureau o the Census, Public Use Micro Sample rom US Census (2000) and American Community Surey (2008).Note: Dierence is percentage point



Chapter II

9

G. What do the Jobs Look Like? Jobs in the restaurant industry generally all into one o three categories, each corresponding to dierent levels o compen-sation, potential or mobility, access to training, workplace conditions, and other important indicators o job quality:

1. Managers and supervisors, including ches2. Front o the house positions3. Back o the house positions

H. What do the Jobs Pay? While the industry does provide some living-wage jobs, the data in able 5 shows that the restaurant industry oers mostly low-wage jobs. According to the Bureau o Labor statistics, the median wage or all restaurant occupations in Chicago-land is $8.86 an hour. Eighty-two percent (82.38%) o workers in the industry are employed in jobs or which the hourly median wage is below $10.00.14 As will be discussed in greater detail in Chapters III: Workers’ Perspectives and ChapterV: Segregation & Discrimination, people o color hold the majority o the lowest paid jobs in the restaurant industry.

Data show that the Chicagoland restaurant industry is an important and growing source o income and employment. As thisindustry grows, it creates more low-wage jobs than living wage jobs. Te restaurant industry contributes almost 250,000 jobs

to the Chicagoland economy, but 82% o those jobs pay less than $10 per hour. And, given the industry’s growing relianceon immigrants and people o color, it is communities that are already marginalized that occupy these low-wage jobs.

TABLE 5. Employment and Median Wages or Food Preparation and ServingRelated Occupations in Chicagoland, 2008

Occupation Employment share Median hourly wage

All workers $8.86

Ches and head cooks 1.44% $15.80

First-line supervisors/managers o ood preparation and serving workers 6.27% $15.16

Cooks, ast ood 5.30% $8.17

Cooks, institution and caeteria 2.72% $11.75

Cooks, restaurant 6.85% $10.70Cooks, short order 1.16% $9.71

Cooks, all other 0.33% $13.16

Food preparation workers 11.64% $9.32

Bartenders 5.05% $8.81

Combined ood preparation and serving workers, including ast ood 19.55% $8.09

Counter attendants, caeteria, ood concession, and coee shop 5.46% $8.08

Waiters and waitresses 17.64% $7.99

Food servers, nonrestaurant 2.06% $8.96

Dining room and caeteria attendants and bartender helpers 4.98% $8.50

Dishwashers 4.68% $8.15

Hosts and hostesses, restaurant, lounge, and coee shop 3.12% $9.22

Food preparation and serving related workers, all other 1.75% $9.50

Under $10.00 per hour 82.38%

Footnotes:(1) Estimates or detailed occupations do not sum to the totals because the totals include occupations not shown separately. Esti-mates do not include sel-employed workers.(2) Annual wages hae been calculated by multiplying the hourly mean wage by 2080 hours; where an hourly mean wage is notpublished the annual wage has been directly calculated rom OES reported surey data.(3) Wages or the OES surey include base rate, cost-o-liing allowances, guaranteed pay, hazardous-duty pay, incentie pay includ-ing commissions and production bonuses, tips, and on-call pay.

Source: U.S. Bureau o Labor Statistics, Occupational Employment Statistics Surey or Chicago-Naperille-Joliet, IL Metropolitan Diision, 2008



Chapter II

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While restaurant jobs in the Chicago metropolitan area have grown, restaurant wages over the past decade havenot experienced the same growth. As Figure 2 illustrates, growth in average annual earnings in the industry haslagged behind that o the entire private sector in Chicago. In 2009 dollars, 2001 private sector annual earnings av-eraged $52,645, but only $17,670 in the restaurant industry. By 2008, private sector earnings had increased by 5.3%to $55,409 a year, while wages in the restaurant industry increased by 1%, to $17,844 over the same period. Tus,restaurant wages grew much more slowly than wages in other economic sectors, despite the growth in the industry during the same period.

In sum, while the Chicago metro area restaurant industry is a growing source o income and employment, earningslag ar behind those o other private sector workers in the city, raising concerns about the prolieration o low-wage

jobs. Te restaurant industry contributes close to 250,000 jobs to the Chicago metro economy, and over 171,000 toCook County alone but 82% o those jobs pay less than $10 per hour. 15 And, given the industry’s growing relianceon immigrants and people o color, it is already marginalized-communities that occupy these low-wage jobs.

10,000

20,000

30,000

40,000

50,000

60,000 All industries

Restaurants

20082007200620052004200320022001

A v e r a g e A n n u a l E a r n i n g s

FIGURE 2: Average Annual Earnings by Industry, Cook County, 2001-2008

Source: Bureau o Labor Statistics, Quarterly Census o Employment and WagesNote: Earnings are defated using the CPI-U or Midwest Urban.



C h A P T E R III

Workers’ Perspectives



Chapter III

12

C h A P T E R III

Workers’ Perspectives

Te inormation summarized in this chapter represents a compilation o the results o 582 surveys and interviews and ocus groups with 29 restaurant workers conducted between September 2008 and May 2009. By speak-ing directly with Chicago restaurant workers, we gained more insight on the daily experiences o workers in themetropolitan region’s eateries. We were also able to collect new data regarding the overall quality o their workplaceexperiences.

Where earnings are concerned, our research results are consistent with existing data – the major-➜

ity o restaurant workers we spoke with reported very low wages.

Most restaurant workers do not receive benets such as employer-provided health coverage, paid➜

sick days, or vacation days.

Most restaurant workers we spoke with do not receive regular raises, promotions, or ongoing job➜

training.

More than hal the restaurant workers in our study are not paid overtime in contravention o gov-➜

erning laws. We also received reports rom some workers that they were not being paid at all or any hours they worked beyond 40 despite routinely being required to do so.

A majority o workers surveyed reported health and saety hazards at their workplace, compound-➜

ed by a pervasive lack o health and saety training. In addition, many o the workers we spoke with reported getting injured on the job.

Workers reported that assertions o their rights were met with verbal abuse and threats o retaliation.➜

Workers earning low wages are less likely to receive benets, more likely to be exposed to poor health and saety conditions,

less likely to be provided with job or health and saety training, and less likely to benet rom advancement opportuni-ties. Conversely, workers earning living wages are more likely to receive health insurance and benets, and work in saerenvironments.



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A. Introduction and Methodology While a majority o jobs are low-wage, low-road jobs in the restaurant industry, our survey research shows that thelow road is not the necessary path in this industry. At least one tenth o the workers we surveyed reported earningliving wages, and similar numbers reported enjoying comprehensive benets, opportunities or career advancement,

and better workplace conditions. While these workers are in the minority, their experiences refect the reality thatsome restaurant employers in the industry are pursuing the high road to protability. Te employer perspectivessummarized in the next chapter oer important insight as to how the conditions described in this chapter can beaddressed.

Tis study was motivated in part by the current dearth o quantitative and qualitative data documenting the experi-ences o restaurant workers in the Chicago. In an eort to pick up where ocial and industry statistics leave o, theChicagoland Restaurant Industry Coalition designed a survey to capture detailed inormation regarding individual

workers’ experiences beyond hour and wage data. Te survey instrument explored the availability o benets, work-ing conditions, hiring and promotion practices, the existence o job-specic training opportunities, employer dis-crimination, and the nature o working conditions in the industry. Stratied random sampling methods were chosento provide an accurate proportional representation o restaurant workers in Cook County. Stratication was used asa sampling technique to ensure that our sample was truly representative. 16 o add to the rigor o the survey designand administration, we weighted the data according to ront and back o the house in ull-service and limited-servicerestaurants to improve the precision o our estimates. Weighting was used to compensate or over- or under-samplingand or disproportionate stratication, and to ensure unbiased estimates o restaurant worker population totals.17

Te survey was administered rom September 2008 and May 2009 by sta, members, and volunteers rom the Res-taurant Opportunities Center o Chicago – a community-based organization with signicant contacts among res-taurant workers and access to workplaces in the industry. A total o 582 surveys were conducted ace-to-ace with

workers in Cook County ater workers’ shits were completed or during breaks. We sought to capture experiencesin all types o restaurants, and surveyed workers in each o the three main segments o the industry.18 Furthermore,our sampling rame, or set o participants rom which the sample was drawn, consisted only o workers employedin the industry.19

Additionally, in order to obtain a holistic picture o the daily lives o individual restaurant workers, qualitative interviews and ocus groups were conducted with a total o 29 workers to gain in-depth inormation about the nature o working conditions. A general interview guide approach was used to conduct the one-on-one in person interviews. Te guide, developed by Dr. Manny Ness o Brooklyn College, contained standardized open-ended questions toensure that the same general areas o inormation were collected rom each interviewee. Interviewers were trainedhow to use the guide to conduct semi-structured, conversational interviews.20

B. Earnings“But people really don’t know [how much we get paid]. Like I had a woman who got really upset about it when I told her -- you know like, servers don’t really make like an hourly rate. She thought like you get ten dollars an hour and the tips are extra. I was like...no.” – Male, 4 years in the indus-try, Server

Our survey data is consistent with government and industry statistics demonstrating that restaurant work is primar-ily low-wage work.

Seventy-eight percent (78%) o workers surveyed in our study reported earnings o less than $16.48 an hour. Fivepercent (4.6%) o this group did not earn minimum wage – even when tips were accounted or. wenty-two percent(22.3%) o workers surveyed reported making a living wage. A living wage “aords the earner and her or his amily the most basic costs o living without need or government support or poverty programs”21 and was calculated usingthe Economic Policy Institute’s Basic Family Budget Calculator. (See side box or wage group denitions).



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METHODOLOGY FOR DEFINITION OF WAGE GROUPS FOR SURvEY DATA ANALYSIS:

Real waes were determined b eiter calculatin worers’ aerae weel earnins includin tips and diidin b te aeraenumber o ours wored per wee or, or un-tipped worers, usin teir ourl wae. Wae roups were ten created usin teIllinois State minimum wae at te time te sure was conducted ($7.75), te Depar tment o healt and human Serices (hhS)2008 ederal poer t line earnins or a amil o tree o $17,600 per ear, and te Economic Polic Institute’s (EPI) Basic FamilBudet Calculator. Te ollowin six actors were cosen to calculate a liin wae: a) housin, b) Food, c) Transportation, d)healtcare, e) Taxes and ) Oter basic necessities. Defnition o wae roups and distribution o te sample population acrossroups can be seen in Table 6.

TABLE 6: Wages Earned by Restaurant Workers

Less Than Minimum Wage (< $7.75) 4.6%

Below Poverty Line ($7.75 –$8.45) 15%

Low Wage ($8.46 - $16.47) 58.1%

Living Wage ($16.48 and higher) 22.3%

Source: Chicagoland Restaurant Industry Coalition surey data

Over hal o workers in our sample (58.1%) reported earning low wages, and one-th (19.6%) reported earning wagesbelow the poverty line. Te impact o occupational segregation, which will be discussed urther in Chapter VI: TeSocial Cost o Low-Wage Jobs is substantial; even though the median wage o our entire survey population was $11 anhour, when workers o color earnings were taken out o our sample, the median wage rose to $14.56 an hour.

Te earnings picture is sligtly dierent or restaurantworkers wen compared to oter workers because anexception to minimum wae laws is made or worers woreularl receie tips. As a result, restaurant emploers inte State o Illinois are permitted to pa tipped worers

minimum wages o $4.65 per our, or 60% o te stateminimum wage, as long as tips make up te dierencebetween $4.65 and te state minimum ourly wage o $7.75 (at te time te sure was conducted). I te donot, te employer must pay workers te dierence.22

In Illinois, owever, tipped workers are not guaranteedte ull minimum wage or eac individual our or sittat tey work. Federal regulations allow employers toaverage out teir workers’ tips over a ull workweek,complicating te tip tracking system and making itvulnerable to employment law violations under te FairLabor Standards Act (FLSA).23

Twenty-eigt percent (28%) o te workers surveyed inour stud repor ted tat te were born in anoter countr,and 36% o tese worers repor ted tat did not ae lealstatus to wor in te United States. Teir actual proportionin te restaurant wororce is liel een ier ien te

possible reluctance o worers to repor t teir immirationstatus or “o te boos” emploment. Despite te lealimplications o te 1986 Immiration Reorm and ControlAct (IRCA),24 wic made it illegal to knowingly ireor recruit immigrants wo do not possess lawul workautorization and required employers to attest to teiremployees’ immigration status, many employers witwom we spoe stated tat undocumented immirantsare widel emploed in te industr. various reports andnews stories confrm tat te restaurant industr proidesan entry-point or undocumented workers, particularlybecause o te opportunities to earn cas by te our– even wen earnings are below ederal and statemandated minimum wages.25 Census data is unlikely tocapture te earnins o tese worers.



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WHAT DOES IT MEAN TO LIvE ON A RESTAURANT WORKER’S EARNINGS?

Accordin to te American Camber o Commerce Researcers Association’s (ACCRA) Cost o Liin Index, wic is based onte composite price o roceries, ousin, utilities, transpor tation, ealt care, clotin, and entertainment, Cicao’s cost o liin is on par wit te national aerae, main it een arder or low-income worers to mae ends meet;26

Accordin to te National Low Income housin Coalition (NLIhC), wile te Fair Maret Rent or a two-bedroom unit in teCicao metro area27 is $1,004, an extremel low-income ouseold (earnin $22,470 or 30% o te Area Median Income o $74,900) can aord montl rent o no more tan $562.28 On aerae, a restaurant worer earnin $11.00 per our can aordmontl rent o no more tan $572 or a two-bedroom unit. For worers to aord a Fair Maret leel o rent and utilities, witoutpain more tan 30% o teir income on ousin, teir ouseold must earn $3,347 montl or $40,160 annuall. Te tpicalrestaurant worer would ae to wor approximatel 76 ours per wee in order to aord a two-bedroom unit at te area’s FairMaret rent. NLIhC determined tat te “housin Wae” – te amount a ull time worer must earn per our in order to aorda two-bedroom unit at te area’s Fair Maret rent – in te Cicao metropolitan area is $19.31.

C. Benefts“Tank goodness, I am single but I do have a riend who knows somebody in the health insurance in-dustry, but I am still paying $150 a month or health insurance and I mean it is not the greatest. It hasno pharmacy or anything so that’s a nice chunk when you are not making that much money” – Male, 4

years in the industry, Various Back o the House positions

Te majority o restaurant workers surveyed reported that they do not receive basic workplace benets. Te datain able 7 reveals that the vast majority o workers surveyed do not have health insurance through their employers(90.5%), over hal (53.4%) reported not having any type o health insurance coverage at all, and 15.8% went to theemergency room without being able to pay. An overwhelming majority reported that they do not get paid sick days(96.2%) or paid vacation days (87%).

TABLE 7: Job and Health Benets Reported by Restaurant Workers

Employer does not provide health insurance 90.5%

Do not have any health insurance coverage 53.4%

Do not get paid sick days 96.2%

Do not get paid vacation days 87%

Have worked when sick 75.9%


“Well, or me, it’s our lie, it’s ow ou pa our bills and te wa I saw it was, ou wor wit tese people. But I now I souldn’tet riendl or personal wit tese people but, ou now, ou spend so muc time toeter, and ou mae joes toeter andou tr to wor and ae un at te same time. Wat I noticed was te owners o tis restaurant tat I used to wor at te weremore concerned about m production tan m well-bein, or ow I ot alon wit eerbod. And one o te owners cameoer to me and said, ‘Well, now tat ou’e done all our duties and all te wor tat ou’re supposed to do, w don’t ou oto te bac o te ouse and brin in, ou now, tis urniture, and I tout, ou’re iin me sometin to do and I’m oin to

brea m bac and ou don’t een proide me wit insurance.’ So we ad tis bi-bi arument and e said, ‘get bac and doour job or else ou’re fred.’ And it was lie, ou don’t ‘et it’. Lie, I brea m bac in ere and wo’s oin to tae care o me,wo’s oin to eed me, wo’s oin to pa m bills, I’m onl supposed to wor in te restaurant. I’m not our maid!” – Male, 9ears in te industr, Busser, Barbac, & Serer

“I beliee tat te restaurant industr sould be a store bound tpe o a job. Weter worers are a waitress bartender or adiswaser. I beliee eerbod sould et te same benefts as someone ou now wo wors in an ofce ets dental. Tewor wa more ours, te are doin te same labor. Te’re doin oertime. Worin in a restaurant is ard labor. It’s reallard labor. I tin tat someone wo wors in te restaurant industr sould et te same benefts as someone in te corporateofce.” – Female, 2 ears in te industr , Serer



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Te majority o the workers we interviewed reported that they were unable to get unpaid time o when they neededit, particularly when they were sick. As a result, 75.9% o the workers we surveyed reported working while sick. Tesenumbers should be o concern to the general public because ood is one o the major avenues through which com-municable diseases are spread. I workers are coming in to the job sick, it endangers the health o their co-workers,customers and the general public.

“Well, you don’t eel priority, I guess. You just eel like a normal worker, when you don’t have benets. You’re not special, I guess. You have nothing to look orward to, because some people get a pension plan, but you have nothing to look orward to. So, I guess it does aect me a little bit.” – Male, 6 yearsin the industry, Server

“Troughout all my restaurants and catering, no benets. No vacation, no sick time. Tat’s what the restaurant business is, though, right? Because a server, a bartender, you just know o the bat [you’re not getting any benets].” – Male, 5 years in the industry, Host

“It aects me because every time we go to the doctor or whatever we have to pay or everything medi-cine, the appointment every time.” – Male, 14 years in the industry, Bartender

wenty-eight percent (28%) o workers surveyed with health care pay or a private health insurance plan out o pock-et. Additional inormation on the impact o the industry’s lack o benets on workers, taxpayers, and the public canbe ound in “Public Cost” section o Chapter VI: Te Social Cost o Low-Wage Jobs.

D. Dead end jobsIdeally, restaurant workers would be able to advance rom lower-paying positions in the industry (oten in the back o the house, or in lower-level ront-o-house positions) to higher-paying positions in the industry (most oten serverand bartender positions in the ront o the house) over time based on their experience and ability, and would havethe opportunity to move up in one restaurant setting, in which internal promotions are possible and encouraged.Unortunately, restaurant workers have ew opportunities to move up in the industry (see able 8). Regardless o oc-cupation, restaurant type, or length o service at a restaurant, workers reported that opportunities to increase their

earnings through seniority or by working their way up the industry ladder are ew and ar between. Eighty percent(79.5%) o survey respondents reported that they do not receive regular raises, and 74.5% o workers responded thatthey had not been promoted since starting at their current place o employment. Tese trends held whether a workerremained in the same place o employment or sought other opportunities – 71.4% o workers surveyed said they hadnot moved up rom their last job when they took their current one. Moreover, 61.8% o workers surveyed reportedthat they do not receive on-the-job training needed to be promoted.

TABLE 8: Raises and Promotions Reported by Restaurant Workers

Do not receive regular raises 79.5%

Have never been promoted in current job 74.5%

Did not move up in position rom last job to the current job 71.4%

Did not receive on-going job training needed to be promoted rom employer 61.8%


“I haven’t received a promotion – I have requested – well, frst when I applied I mentioned that I wanted to work bar eventually, or be trained on the bar because I do think that the best way to move into bartending is to have experience in a restaurant, and then have experience working an actual bar.So it was something I made clear when I applied and when I was hired, and regularly when we’ve had openings I’ve indicated my interest to my managers – maybe I haven’t exactly requested the pro-motion, but I ’ve been told I will never get it pretty clearly. It’s not going to happen.” – Female, 2 yearsin the industry, Server



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Te majority o restaurant workers are essentially trapped in low-wage jobs with long hours, ew benets, and ew advancement opportunities. A discussion o a lack o movement between ront and back o the house workers emergedas a reoccurring theme in the interviews. A dishwasher who has been in the industry or 8 years explains that herecently received a promotion to ood prep, even though he “wants to be a server.” Ater three years in the industry,a cook who works in a ne-dining establishment reported: “I asked or a promotion to bartending but I didn’t get itbecause they think that women are better or it.” Several employers explained that when they hire or the kitchen,there is not much room to “advance in position;” as when they hire or a dishwasher, or example, they are lookingor a person to do that job and to continue occupying that position. Most o the workers we spoke with working inthe industry or three years or more, reported having no choice but to leave an employer in search o better jobs atother restaurants. Not only does the constant search or a better job deny workers job stability and economic security or themselves and their amilies, but it also ends up costing employers in turnover-related costs.29 Tese two actorslead to a no-win scenario, and greatly threaten what could be a shared economic prosperity, as discussed in greaterdetail in Chapter III: Employers’ Perspectives.

“Well, I think any time I’ve tried to advance anywhere, I don’t think that was the reason. It was more like they denied me because they didn’t think I was right or it or whatever reason. But I’ve also nev-er, I gured I got paid more as a barista than a dishwasher and a busser, so [I look or those positions].”

– Female, 3 years in the industry, Cashier

E. Employment and Labor Violations

As mentioned in Section B aboe, restaurant emploers in te State o Illinois are permitted to pa waes o $4.65 per our totipped worers. I tips do not brin te worer up to minimum wae, emploers are responsible or main up te dierence.Furtermore, it is unlawul or emploers to tae tips rom restaurant worers. Te emploer, or eac pa period in wic tipsare reported, must eep a writ ten tip statement sined b te emploee and dated beore eac pacec is receied on fle.30 Inpain worers $4.65, or 60% o te state’s minimum wae, emploers rel on tips rom customers to pa te dierence betweenworers’ tipped ourl rate o $4.65 and te leal minimum in te state. howeer, i tips do not brin te worer up to minimumwae, emploers are responsible or main up te dierence. Wile “tip-poolin” and “tippin-out” is a common practicein most restaurants, i t is unlawul or emploers to tae tips rom restaurant worers. Interestinl, 88.7% o restaurant worerssureed were not aware o te correct minimum ourl wae or tipped worers and 68.5% did not now tat $7.75 was te stateminimum ourl wae at te time te sure was conducted. Illinois as a state minimum wae tat is ier tan te ederalminimum wae or bot tipped worers ($2.13) and non-tipped worers ($7.25). Te state ourl minimum wae increased rom$7.75 to $8.00 in Illinois on Jul 1, 2009. Illinois will experience anoter minimum wae increase to $8.25 an our on Jul 1, 2010as mandated b Public Act 094-1072, an amendment to te Illinois Minimum Wae Law. 31 Clearl, more public education, orworers and emploers alie, is needed wit respect to oernin laws in te restaurant industr.

“I recently took a job there or this thing, temporary, another kind o awul experience. But now, I be-lieve because it’s such a horrible corporate place – it was just a really bad experience. Tey don’t have a percentage or what you tip out to your bussers, they leave that to your discretion because the tipping

rom their clientele is so horrible.” – Male, 4 years in the industry, Server

TABLE 9: Employment Law Violations Reported by Restaurant Workers

Employment Law Violations Reported by Restaurant Workers Percent o WorkersExperienced overtime wage violations 32.6%

Worked o the clock without pay 28.5%

Management took share o tips 14.7%

Experienced minimum wage violations 4.6%


As illustrated by able 9, many workers reported being paid less than minimum wage and receiving no overtimepay when they worked more than 40 hours per week, in violation o both ederal and state wage and hour laws.

Tirty-three percent (32.6%) o all workers surveyed told us they were not paid overtime or hours worked beyond



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the standard 40-hour workweek. While ne-dining workers reported a higher proportion o management stealingtips (12.5%) and minimum wage violations (18.5%) than the general survey population, employment violations oc-curred in every segment o the industry.

“Tere’s always a tip. So we do events and at the end o the event there’s a big tip. But always with

the tips it’s always corrupt because the unction director, he’s the manager who receives the big tip and he’s supposed to divide it evenly with all the servers, the cooks, the ches and himsel. So at the end o the night he’s supposed to give everyone an even amount. But there’s always times when you think he doesn’t, when someone gets more than you, or when you get a very less amount, knowing that it’s more,and you just know that he got the rest o the money. And right there, there’s no sense o word, or howdo I say it, or paperwork. He has all the power and nobody can tell him what to do or what not to do.Tere’s always problems at the end with the tip.” – Male, 4 years in the industry, Server

Some workers we interviewed reported being paid a fat rate no matter how many hours they worked, a practice com-monly reerred to as “shit pay.” However, the Fair Labor and Standards Act mandates that i workers are scheduledor a shorter shit and they end up working more than eight hours or more than 40 hours per week, employers mustpay overtime.32 Furthermore, 100% o the workers interviewed who worked in the ront o the house positions re-

ported that their hourly wage depended on the type o shit they worked. For example, a server who has been in theindustry or 12 years, explained “I usually worked eight to ten hour shits, sometimes much shorter depending onhow busy it is. Te restaurant where I work usually has ewer servers and real ly big sections so I usually have a sectiono maybe 12 tables or more. And we’re usually busy at 6pm, weekends we get a rush at like midnight, [that’s when Iget the most tips].” When a particular shit is less busy, all servers reported being “cut” because they were not mak-ing any tips. Juan, a server who has been in the industry or 3 years reported: “I’d come in or our hours and makeless than $30 on a slow shit. Tat’s all I would make.”

Several workers also told us they were paid a xed rate on a bi-weekly basis, regardless how many hours they worked,and as a result, their average earnings were always less than minimum wage. Tese experiences illustrate the im-portance o qualitative studies in industries such as the restaurant industry, which are not closely regulated and rely heavily on inormal employment arrangements, as many workplace practices are not reported to government agen-cies or industry associations.

“Te workers pretty much get their money rom the tips. Te restaurant doesn’t pay anything to themnot even the minimum wage. Tey make their own money but everything is made out o tips they get nothing rom the house. I have a riend who works there he is rom Cuba he was telling me the slowdays run rom $120 to $150 a day and the busy days $300 a day. Which is good but the house does not

put money in their pockets. I think is good money but bad because they do not get paid by the house theyshould get at least the minimum wage.” – Male, 10 years in the industry, Cashier

Five percent (4.6%) o workers reported being paid less than minimum wage, in violation o the law. In the State o Illinois, employers may pay as little as $4.65 an hour to tipped employees, as long as they receive enough in tips tomake up the dierence between the tipped wage and the state minimum wage. I tips are insucient to bring work-ers up to the state minimum wage o $7.75 an hour (at the time the survey was conducted), however, employers are

obliged to make up the dierence.33

Nevertheless, o the workers we interviewed, several reported being paid nohourly wage at all and subsisting on tips alone, oten averaging out to an hourly rate ar below the legal minimum.

“I usually worked 8 hours straight. I needed those tips. I was almost on a tight schedule. I was work-ing rom 8:45 am until 5:00 pm without a break. You know that that is illegal but there is always thismentality that you go to your job get it done then go home and rest. It is an unwritten mentality.” –Male, 8 years in the industry, Busser

“Where I work now, they don’t pay holidays, overtime, or when it’s slow. I rely on tips.” – Male, 15 years in the industry, Busser



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More than a quarter (28.5%) o the workers we surveyed reported working “o the clock ” without pay. Other work-ers reported having to end their shit early and sti ll work, otentimes receiving no pay. When asked why they had toend their shit early and still work, these workers explained they were too close to earning overtime, yet continuedto work because they needed the opportunity to earn tips. Finally, 14.7% o tipped workers reported that manage-ment was unlawully taking a share o their daily tips – a severe burden to workers who are already being paid very low wages.

“I am very passionate about the way [we] are treated, unortunately I’ve gotten a reputation or stand-ing up or what I believe, about how managers been treating their employees, especially the manager taking hosts’ tips. Tose issues are not addressed by management and won’t be addressed by manage-ment.” – Female, 5 years in the industry, Server

F. Health and Saety Violations“By now this day is just all about money and as long as they make their bucks you know, ‘cause I heard a lot o people I have a lot o riends who work down town and they get no training they treat you like

you were blind, just throw you ‘go’ play, you know without you knowing anything. You have to pick up

on your own i you do something you were not suppose is a mistake, but now the supervisor sees you…because they did not train you so, is their ault. I have a riend this is weird thing, he just came romschool it was summer and he said he went to the kitchen and the supervisor told him okay I want youto cut this lime or me and when he was cutting it he cut his nger. Tey told him ‘you have to go youare out o here’ and they red him. Tey said it was his ault because he should have told them that he never used a knie beore.” – Male, 10 years in the industry, Busser

Our survey data also revealed that restaurant workplaces commonly do not employ or enorce regulations designed toensure the health and saety o workers, in violation o the ederal Occupational Saety and Health Act (OSHA). 34

TABLE 10: Health and Saety Violations Reported by Restaurant Workers

Unsaely hot in the kitchen 25.7%

Fire hazards in the restaurant 18.1%Missing mats on the foor to prevent slipping 19.7%

Missing guards on cutting machines 26.8%

Done something that put own saety at risk 33.6%

Did not receive instruction or training about workplace saety 32.3%


As shown in able 10, twenty-six (25.7%) percent o workers surveyed reported that it gets unsaely hot in the kitchen where they work. Signicant numbers o workers reported re hazards such as blocked doors or non-unctioning reextinguishers in the restaurant where they worked (18.1%), as well as absence o guards on the cutting machines (26.8%)and mats on the foor to prevent slippage (19.7%). Tirty-our (33.6%) percent reported having done something at work

that put their own saety at risk. Despite the prevalence o health and saety hazards in restaurant workplaces, nearly athird o the workers (32.3%) told us they did not receive health and saety training rom their employers.

TABLE 11: Workplace Injuries Reported by Restaurant Workers

Burned while on the job 47.8%

Cut while on the job 53.7%

Slipped and injured while on the job 13.5%

Came into contact with toxic chemicals while on the job 11.3%

Have chronic pain caused or worsened by the job 21.8%




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able 11 demonstrates that on-the-job injuries are pervasive in Chicago restaurants. 47.8% o all workers surveyed –or 271 workers out o the 568 workers eligible to answer the question - had been burned on the job . Fity-our per-cent (53.7%) o workers surveyed had suered work-related cuts on at least one occasion, and 11.3% had come intocontact with toxic chemicals. Fourteen percent (13.5%) reported that they had slipped and injured themselves whileat work. Additionally, 21.8% reported chronic pain that was caused or worsened by their job.

“So, I cut m fner at wor last ear. I cut m tendons in m fner. I was bartendin, actuall. I tout I was oin to recoerater tree das, but I noticed tat m fner wasn’t oin up or down. So I went to o see te doctor, and e told me ou urtour tendon at wor. So e told me m wor would ie me worer’s comp. And it actuall wored prett ood about tat. I wasluc to ae insurance rom m scool and te paid or te wole surer and eer tin. It was oer tree or our rand. I Iadn’t been in scool, I would probabl ae a deormed fner” – Male, 6 ears in te industr, Serer

TABLE 12: Workplace Practices Reported by Restaurant Workers

Worked when the restaurant was understaed 81.1%

Perormed several jobs at once 88.0%

Experienced verbal abuse rom supervisors 30.9%

Perormed a job not trained or 52.1%

Done something due to time pressure that has put own health and saety at risk 33.6%

Done something due to time pressure that might have harmed the health and saety o customers 23.9%


Final ly, able 12 reveals that understang, which places inordinate pressure on workers, is a common industry prac-tice. Eighty-one percent (81.1%) o respondents reported working when their restaurant was understaed and 88%reported they have perormed several jobs at once. Hal (52.1%) responded that they have been required to perorm

jobs or which they had not been trained, and 33.6% o workers reported doing something under time pressure that

put their own saety at risk (i.e., grabbing overly hot plates/pans in order to not keep the customer waiting). And, aspreviously discussed, nearly three ourths o the workers we surveyed reported working while sick (75.9%). Such low road workplace practices not only aect workers, but can also have serious consequences or consumers. Fourteenpercent o workers reported having done something that might have put the health and saety o the customer at risk as a result o time pressure. In act, as urther discussed in Chapter VI: Te Social Cost o Low-Wage Jobs, survey data indicated a correlation between health and saety violations and impact on consumers.

Te ederal Occupational Saety and Health Act (OShA) imposes standards or ealt and saet in te worplace, requirinemployers to provide protection or workers in azardous environments and to keep records o all workplace injuries andaccidents. OShA coers toxic cemical use – te statute requires loes, or example, or diswasers and itcen cleanerswo use er ea toxic cemicals – and temperature o wor enironments, includin excessiel ot itcens. Wile tereis no mandator requirement tat emploees be proided wit specifc ealt and saet trainin, suc trainin is eectielnecessar to ensure compliance wit OShA and worers’ compensation law.

In addition, employers in te State o Illinois must secure workers’ compensation insurance or every employee. Te IllinoisWorers’ Compensation Act is a no-ault law; worers are eliible or benefts een i te contributed to teir own injur. Awor related injur ma be an isolated incident (allin down) or a reoccurrin action tat leads to an injur, condition or illness(dail inalation o a toxic cemical). Illinois Worers’ Compensation law also stipulates tat worers’ related medical expenseswill be ull coered, to emploees entitled to worers’ compensation benefts, wit no time or monetar limits. Furtermore,te injured employee as te injured employee as te rigt to be treated by two doctors and teir reerrals at te costo te employer. Workers are also allotted time o to recover rom an injury or illness, and may be eligible to receive fxedcompensation or an permanent disabilit.35



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G. Many “bad jobs,” a ew “good jobs”Analysis o our data revealed the existence o not only the low road practices described above, but also o correlationsbetween workers’ earnings, benets and workplace conditions. Unortunately, since many o the jobs in the restau-rant industry are long-term, these conditions cannot be dismissed. Restaurant workers surveyed reported working

an average length o time in each restaurant at two and a hal years. More than a quarter (27.2%) o workers surveyed reported working in one restaurant or three years or more. More than three-ourths (79.6%) o the workersthat reported working in the same restaurant or six or more years were workers o color. While they may not stay in one particular restaurant or many years, many workers most denitely stay in the industry or their lietime. Temedian hourly wage reported by workers that worked in one restaurant or three or more years was $11.54, comparedto $8.50 or workers who had worked in the same location or only one year or less.

Additionally, there was a high correlation between workers that reported receiving promotions and the length o time they stayed working in one restaurant. Fity-three percent (52.9%) o workers who stayed in their restaurant orsix or more years received a promotion, while only 26.4% o workers who worked between one and three years in thesame restaurant received a promotion. When combined with ndings rom the interviews, these statistics indicatethat many o the workers are quitting their jobs to nd others that provide better opportunities and higher wages,still in the restaurant industry. Tus, contrary to the popular myth that workers are “transient” and use their jobs astemporary stepping stones on their way to earning more money, the restaurant industry is actually a career choiceor many. A ne dining server who has been in the industry or more than ve years explains that low wages andlack o access to benets in the industry “sucks because some o us take our jobs seriously. We make the restaurantour career, but we don’t [enjoy] the benets o a career.”

O the 582 workers we surveyed, the vast majority reported working 40-hours per week (53.1%), year-round (91.2%),or more than one year in one restaurant (71.8%). Clearly, most workers make a career out o the restaurant industry,and several workers explained that turnover rates are high because they are constantly seeking better jobs.

“Yes they paid overtime, they paid holidays all time and a hal. Every paid shit they gave you a paid lunch and at the end o the year i you don’t use it you can cash it and they give you cash or you can still use it i you like. I mean it was pretty good I was very happy that I worked with them. I let because I

needed benets.” – Male, 8 years in the industry, ServerOur research shows that when workers receive poverty wages and experience a lack o promotions and benets, they requently encounter a large number o additional poor workplace practices, creating an industry o many “bad jobs”and ew “good jobs.” Specically, our data demonstrates that workers in lower wage positions are:

Less likely to receive regular raises, promotions and job training needed to move up in the indus-➜

try. Conversely, workers in living wage jobs are more likely than workers earning incomes below the poverty line, and much more likely than workers earning less than minimum wage, to be pro-moted within their workplace or when they move rom one job to another.

Less likely to receive workplace benets such as employer provided health insurance, or paid sick ➜

and vacation days. For example, workers in living wage jobs were more likely than workers mak-ing less than minimum wage to have health insurance.

More vulnerable to violations o employment laws, more likely to be exposed to unhealthy and➜

unsae workplaces, and more likely to have to work longer hours in order to make a sustainableliving in the industry. For example, more than three quarters (83.3%) o workers earning less thanminimum wage reported overtime pay violations, compared to only one-third o workers in living wage jobs (33.3%).

Less likely to receive training, such as health and saety training, to perorm job duties. Workers➜

earning less than the poverty level are particularly likely to be required to perorm jobs without receiving the necessary training.



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TABLE 13: Conditions Reported by Restaurant Workers, by Wage Group

Conditions Reported by Restaurant Workers,by Wage Group

Less than MinimumWage

Under PovertyLine

Low WageLivingWage

Do not get regular raises 95.2% 85.3% 73.3% 89.7%

Do not receive paid vacation days 100.0% 88.4% 86.4% 85.6%Do not receive paid sick days 100.0% 93.8% 95.9% 98.3%

Do not have health insurance 80.8% 57.6% 49.4% 54.8%

Have not been promoted in current place o employment

84.6% 91.6% 68.6% 78.5%

Have not moved up in position rom lastplace o employment to current

80.8% 77.2% 69.4% 72.9%

Experienced overtime violations 83.3% 55.6% 24.9% 33.3%

Worked o the clock without being paidhourly wage

20.0% 35.8% 28.7% 24.1%

Did not receive health and saety instruction

or training rom employer 34.6% 40.0% 31.2% 29.8%Source: Chicagoland Restaurant Industry Coalition surey data

kam, hon kon, delier

I came ere 5 ears ao rom hon kon and I ae wored in te restaurant industr or a ear. WenI frst started in te industr I was excited because I ad seeral dierent positions as a serer. I latersaw tat tere was no reason to be excited I alwas ot paid below minimum wae, at one place I waspaid $10 a da plus tips or worin 9-10 our sits, I ae alwas been paid between $0- $2.50/r asa serer. I decided tat tis wae was too low and I switced to delier drier, as a delier drier Iwas not paid an ourl wae and onl receied te delier care and wateer tips came rom tatdelier, I was required to proide m own car and pa or m own as. Wen I switced m positionI was orced to sin a paper to state tat I was not an emploee o tat restaurant, wen I ot burned

rom cemicals on te job and m nail split open I could not as to et loes or protection because Iad sined tat paper, I was orced to brin m own rom ome.

As a delier drier wit no ourl wae I was also orced to do side jobs, I wased te dises, cooed,and bussed tables, wit tis extra responsibilit I wored oer ort ours and onl occasionall receied $30 a da. I also didnot receie a brea, worers were not allowed to eat in te restaurant, onl occasionall wen it was reall slow, but since I wasdelier I was able to snea a lunc, I would delier te ood quicl ten I would par m car and eat te lunc I ad broutmsel.

Te scedule I wor canes wee to wee, sometimes I wor tree das sometimes our, tis maes it impossible or me toplan m lie and scedule or antin oter tan wor, te restaurant wants a career commitment witout proidin me tecareer benefts. I do not ae ealt insurance, I do not ae sic das te boss i s alwas unapp wen people call in sic, andte alwas tell us tins lie i ou don’t come in toda don’t eer come bac. “I ou don’t lie worin ere tere is te door,”is sometin we ear dail.

All o te worers at te restaurants I ae wored in were Asian immirants and te treated us all unair, te too adantaeo our need to wor. I lie worin in restaurant industr I just want to be treated wit respect and I want tis job to ae career

benefts because it’s m career.



C h A P T E R Iv

Employers’ Perspectives



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C h A P T E R Iv

Employers’ Perspectives

Our interviews with employers in Chicago’s restaurant industry proved to be a rich source o inormation regardingthe constraints under which they operate, thus leading them to engage in the practices described by workers in Chap-ter III: Workers’ Perspectives - oten despite their best intentions and their expressed belie that restaurant workersare critical to their success. Our interviews with employers highlighted the principles and approaches adopted by employers pursuing the high road – those who manage to maintain successul businesses while ensuring that their

workers earn a liv ing wage and are guaranteed workplace benets and sae work environments. As such, the perspec-tives summarized in this chapter can serve to guide urther study o the industry, and, perhaps most importantly, lay the groundwork or initiatives developed in partnership by restaurant workers and employers.

Our interviews with employers revealed that:

Market volatility brought about by actors beyond employers’ control such as green trends in the➜

industry, economic downturns, and changing tastes require signicant exibility on the part o

restaurant employers.

Worker productivity and low employee turnover are both important to protability. Workplace➜

practices intended to increase productivity, such as understang and longer, more unpredictablehours, can have the efect o increasing employee turnover, creating a dilemma that many employ-ers ace.

Te majority (58%) o Chicagoland restaurant employers interviewed elect to take the low road➜

to protability, ofering low wages, even while stating preerences or some high road strategies. While employers recognized workers’ dependence on wages and overtime to earn enough to meet basic needs, they also reported a policy o keeping wages low and overtime pay to a minimum.

Many employers stated that they would like to ofer their workers health insurance, but maintain➜

that it is almost impossible to do so due to prohibitive costs.

It is possible to achieve protability by taking the low road and paying living wages, providing ➜

benets, and maintaining a sae working environment when there is a non-negotiable commit-ment to doing so. Fourteen (45%) o the 31 employers interviewed reported that they were ableto invest in workers by ofering higher wages, training, and advancement opportunities, and still earn a prot. Employers taking the low road, however, undermine restaurants ollowing the highroad approach.



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A. Introduction and MethodologyIn order to obtain a better understanding o actors that drive workplace practices, the Chicagoland RestaurantIndustry Coalitioninterviewed restaurant employers in Chicago. With the assistance o students and aculty romDe Paul University and other Coalition partners, we conducted in-depth interviews with 31 restaurant employers,

including owners and managers, rom September 2008 to May 2009. Employers were selected or interviews in amanner designed to gather data refective o the distribution o the dierent segments - ne dining, casual/amily style, ast ood/quick serve – and sizes o Chicago restaurants. Interviews included questions regarding trends in theindustry over time, actors aecting business practices, strategies or running a protable business, workplace prac-tices, and the role o the inormal economy in Chicago’s restaurant industry.

Overwhelmingly, 100% o the restaurant employers we interviewed recognized the important role that workers play in the vital ity o the industry and the success o their businesses. Te vast majority o employers described their work-place policies as supportive o workers and their development. However, when in-depth analyses o qualitative datarom employers and worker responses to our surveys are juxtaposed, a more complex picture emerges.

Both worker surveys and employer interviews conrm that some employers are paying living wages, providing com-prehensive benets, and ensuring healthy work conditions while successully running a protable business. Indeed,

22.3% o workers we spoke with reported being paid a living wage by their employers, and a similar share reportedreceiving workplace benets.

Tese employers, however, are the exception, rather than the rule. Employers also recognized that the low road toprotability - paying low wages, engaging in wage and hour violations, and cutting corners on health and saety,- is the path more oten ollowed in the Chicago restaurant industry. While there are surely some “bad” employ-ers who operate only or their own prot, at the expense o their workers, what appears to be more common is thatemployers espouse supportive workplace policies in theory, but do not implement them in practice. Tis disconnectcan be largely attributed to lack o good management, absence o industry incentives rewarding good employmentpractices in the industry, and ineective employment law enorcement mechanisms. Additionally, employers wouldclearly benet rom better guidance rom the industry as a whole, including more education regarding their legalobligations, and enorcement o these laws. Although the workers are the ones who lose out in the short term as aresult o low road workplace practices, interviews with employers suggest that the industry as a whole loses out in

the long run.

B. External Factors Aecting Workplace PracticesIn order to better understand the tensions and contradictions in the restaurant industry aecting employers and

workers alike, it is important to consider some o the most salient external pressures on restaurant businesses in thelocal context. Employers we interviewed reerred to two central actors that impact their business, workplace, andemployment practices - the economy and “the greening” o consumer demand.



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TABLE 14: Chicagoland Interview Survey Sample by Attributes

Industry Segment Number o Employers (%)

Fine-Dinin 11 (35%)

Famil Stle/Casual Dinin 15 (48%)

Quic Serice 5 (16%)

Total 31 (100%)

Position

Owner 7 (23%)

Manaer/general Manaer 24 (77%)

Total 31 (100%)

Gender

Male 18 (58%)

Female 13 (42%)

Total 31 (100%)Length o time in industry

Less tan 1 ear 5 (16%)

1 – 3 ears 1 (3%)

3 – 6 ears 7 (23%)

6 – 10 ears 6 (19%)

More tan 10 ears 12 (39%)

Total 31 (100%)

Source: Chicagoland Restaurant Industry Coalition interiew data

“With the economy the way it is obviously people are looking or value. I think that when you surveydierent products you know almost in any prices a good product is good or you its healthy is prepared and taste great. And you oer good service at any price that is valued. And now we’re suering a little bit. And its a constant battle . I mean its a constant battle even when the economy is good. Got to staynew and resh and remind people that you’re there. And to you know constantly to be touching up the holes in the wall always try and look new and resh and always have the right product.” – Owner, 25

years in the industry, Fine Dining

Te Chicago restaurant industry continues to be one characterized by robust growth, as shown in Figure 3. Tenumber o restaurants in Cook County increased by 18.4%, rom 8,009 establishments to 9,485 establishments be-tween 2001 and 2008.36



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0

2,000

4,000

6,000

8,000

10,000

20082007200620052004200320022001

N u m b e r o f e s t a b l i s h m e n t s

FIGURE 3: Growth in Food Services and Drinking Placesin Cook County, 2001-2008

Source: Bureau o Labor Statistics, Quarterly Census o Employment and Wages.

While almost all employers interviewed discussed the economic crisis as aecting the industry, they also said theirown business was not substantially aected. In act, despite the general perception that other restaurants were su-ering, and statements that other restaurants have had to reduce prices and downgrade to meet consumer demand,most employers noted that they were not having to do so themselves, and that they were surviving the economiccrisis by adapting to consumer demand or greater value.

Tese seemingly contradictory observations refect national trends. While the industry is generally perceived to bedeclining, the restaurant industry lost only one-quarter o the jobs that the rest o the economy lost rom March2008 to December 2008.37 And, while most other sectors continue to decline or lag, the restaurant industry has al-

ready begun to post growth as o July 2009.38

Certain segments o the industry, such as ast ood and liquor sales,have been growing throughout the crisis.39

“My intuition is that restaurants are ever more popular. I that’s what you mean, what’s the sense o the audience’s relationship to restaurants? I think demand is up, it seems to me, I don’t keep count o course but it eels to me that there’s more and more restaurants opening all the time, and that suggeststhat there’s a kind o enthusiasm behind that. Tey’re sensing that, that i they open, i you build it theywill come. .. My sense is that as more restaurants have moved in our business has just gotten better.” –Owner, 11 years in the industry, Fine Dining

“Business has been pretty similar over the past – well as long as I have been working here about ten years things have been pretty similar. I would say not much has changed over the past ten years. Just recently, the past year or so the economy has been a problem but nothing much over the past ten years.” – Owner, Over 10 years in the industry, Family Style

Employers repeatedly emphasized the increase in liquor sales, which has helped them stay protable during slow economic times. Historically, even during a recession, bars and restaurants that serve alcohol remain popular andexperience increases in prot.40 Several employers reported revamping the menu by reducing portion sizes, lower-ing prices o ood items, and including more drinks as that is where they derive most o their revenues. Economistsreport that alcohol is a counter-cyclical asset, a good that dees economic trends. 41

“And the other thing is, and it’s not even a matter o the money sometimes, the climate right now isalso warranting going green. And what is going green? You’re more conscious o ood additives, preser-vatives, things like those. When you’re in a ne dining establishment there’s not a lot o room or plas-



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tic ood. What you’re serving is real, is resh. You’re not going to get a sh, i your sh isn’t resh, then you’re not going to be able to serve it to your customers. So i you go to McDonald’s, or i you go to a place that’s oering you rozen sh, let’s say you come here and you’re getting a resh sh. You might be paying a little bit more money, but you know what you’re ingesting is quality. Tere’s no chemicals in

it. So I think that makes a dierence in amilies. Because I see a lot o amilies coming into ne dining establishments right now. It’s quality o ood versus the ast chemical intake.” – General Manager, 6 years in the industry, Fine Dining

GREEN TRENDS IN THE INDUSTRY

Several employers spoke o the need to “go green” in order to stay competitive in the industry. Industry researchpoints to the increase in consumer demand or healthier alternatives and economically efcient restaurants.42 InChicago, there are a ew certied green restaurants and the trend seems to increase as more diners become aware o

what they consume, how it is packaged, and ood’s impact on the environment.43 Te U.S. ood system alone uses asmuch energy as France’s total annual energy consumption, and with “ood miles” requiring an estimated 1,500 milesbeore being consumed, many employers spoke to how diners understood the unsustainability o these practices and

were looking or “greener” options.44

“I think now people are more concerned about what they eat. You know, we have been inundated withhow we see and what we see and it is overwhelming or a lot o people. I think our guests now rely onus to [oer the healthiest options and explain it to them]. So rom our stand point we have to do their homework or them [by oering quality oods and then explaining it to them]. And [with my ront o the house workers], they obviously have to be trained, and skilled, and educated enough to discuss those items with the table. [Guests] expect that rom you. Tey want more inormation at the table, in bite sizes - pieces o inormation that they can process quickly in order to make a decision.” – Manager, 30

years in the industry, Fine Dining

Unortunately, “green” restaurant employers do not always necessarily take the “high road” with regard to employ-ment practices. While it is essential that the restaurant industry strives to lessen the environmental impact caused by ood consumption, it is also essential that employers and consumers alike recognize the equal importance o treating

workers with dignity and respect.

C. Strategies or Proft o deal with many o the external pressures outlined above, employers generally agree that one o the most impor-tant elements o maintaining a prot is human capital. In act, most employers in our sample agreed that reducingemployee turnover and increasing employee productivity were both critical to maintaining protability.

MINIMIZING TURNOVER

“I think that owners who underpay their sta are going to suer the consequences. So I think it under-cuts their business in the long run. It’s basically like a personal relationship, it pays to be accommodat-ing and to be interested in the welare o the other person because it’s going to make your welare better,it’s as simple as that. I think employee turnover has a direct relationship to protability in the sense that i they’re not happy with what they’re making and you’re paying everything that the business can paythem; they’re going to leave at some point. – Owner, 10 years in the industry, Fine Dining

Establishment o a loyal customer base and personable service was cited by employers as critical to promoting busi-nesses and ensuring consistency in prot. Consistency and quality o stang is o great importance to the employers

we spoke with, who told us that keeping sta turnover low was critical to the success o their business. Most employ-ers agreed that turnover is expensive and destabilizing to a restaurant workplace:



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“[urnover] can cost a lot because it is tough to constantly have to train a new person. And i there is one chink in the armor it can have an eect on the whole process. And i we have to get a new dishwasher every month, then that would mean that we would have to nd a new dishwasher and it would screwus up in not getting the ood out ast enough and then the service isn’t as good.” – Owner, 27 years in

the industry, Family Style“How do you keep your turnover rate low then? I guess just make sure that you treat your employeeswell and have a good work environment.” – Owner, 4 months in the industry, Quick Serve

Employee turnover rates in te restaurant industry oten exceed 90% per year. Suc ig levels o turnover impose botdirect and indirect costs on businesses. Direct costs include te time and mone required to fnd, ire, and train replacementworers. Indirect costs include declines in productiit and qualit o serice causes b understafn durin te time it taesto fnd replacement workers, and by te inexperience o new workers. Previous researc suggests tat dissatisaction witcompensation is a major cause o restaurant emploee turnoer.45

Employers recognized the importance o keeping employees happy in order to decrease employee turnover, thereby

ostering a satised and loyal customer base. Some o the strategies mentioned by employers as important to promot-ing good conditions or workers included training, promoting rom within, paying sustainable wages and providingother “perks” ranging rom workplace benets to sta outings. In addition, many employers cited the overall impor-tance o creating a good work environment and a sense o amily.

I think in ne dining you see a lot o places that do well, perhaps you see servers and cooks are happybecause they are busy and they are being paid well, because business is making money. So, a successul business is going to keep employees a little longer, because [employers] recognize that they are doing well and they want to keep their employees happy, because employees are the part o the reason that they are doing so well. I’d think as you go down the ood chain rom price points down, you would see more turnovers. Our restaurant is kind o in between, we are kind o casual- ne dining. It is not necessary

or ne dining, because our prices are higher, because we are doing higher level ood than most o restau-

rants on the street. So we don’t have high turnover at all. We know that we recognize our employees,this is the part o the reason we are doing well. We are trying to keep everybody happy, Yeah, I think,i you would go down on the ood chain those ast ood restaurant have higher turnovers, because em-

ployees are less gratied.” – Manager, 10 years in the industry, Fine Dining

WORKER PRODUCTIVITY

Employers reported that worker productivity is critical to running an eective and protable business. Tere are di-ering theories regarding how to best maximize productivity. Some employers believe that training and investing in

workers is best. On the other hand, some think that hiring ewer workers to perorm several tasks is the most e-cient way to move production. Fourteen (45%) o the 31 Chicago employers interviewed, however, echoed the belie

that investing in workers – in terms o wages, working conditions, training, advancement opportunities, and more– is the most eective way to keep workers happy and productive.

D. Contradictions in Theory and Practice“Litigation is a big issue or the restaurant industry. It’s one that the National Restaurant Associationhas worked on or years and always will.” – John Gay, senior vice president o government aairsand public policy or the National Restaurant Association.46



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“I mean there are so many people that are actually doing it [violating the law] that there is not reallymuch – I mean you can say that like we can make it illegal blah blah blah – but like it’s really hard toenorce. Most people won’t even say that they are getting paid below minimum wage.” – Manager, 10

years in the industry, Family Style

While some employers are committed to pursuing the high road to protability – providing workers with decent wages, benets and training – these employers are unairly undercut by those who choose to take the low road toshort-term and unsustainable gain. In some cases, this approach is related to management and business skills; inothers, it comes down to a lack o enorcement, support, and rewards promoting good workplace practices. Whatbecomes clear, however, is that low road practices are counter-productive, ultimately having negative impacts on

worker productivity, employee turnover, and restaurant protability.

WAGES AND OVERTIME

“Well you know I think that in this market people are always looking cheat the systems a little bit be-cause workers are one o your biggest expenses. So it’s tough – I can kinda understand both sides because

people have to make a living but there is also you know hundreds and hundreds o people out there that are willing to work or less. So, umm it’s a hard one, but I can see both sides o the story.” – Owner, 4months in the industry, Quick Serve

“What is our overtime policy? Uhh, there really isn’t one. Tere is no extra pay or overtime.” –Manager, 10 years in the industry, Family Style

Despite some employers’ expressed understanding o the importance o paying good wages to keep sta happy andproductive, the majority o workers in Chicago receive low wages, and are not paid or overtime. Several Chicagorestaurant owners we interviewed recognized this contradiction.

“Eventually [low road employers] will drive themselves out. Te turnover rate will be so high in those restaurants they will never be able to produce a great sta or maintain a good sta. In this business it’s

a lot like sports. Te better players, they want to be drated to the better team so they will leave on their own, eventually. So I get the benet o better qualied individuals, more skilled and they lose them inthose restaurants.” – Manager, 20 years, Fine Dining

Unortunately, employers who do not comply with the law do not leave the restaurant industry soquickly, as evidenced by the vast majority o workers who suer under low wages and constant em-ployment law violations.

“Raisin standards or restaurant worers is no eas tas and we must all sare in te responsibilit. Union and political leaders,academics and actiists, ait leaders and communit roups, emploers and oernment aencies must all contribute in tedierent was tat we can to support restaurant worers in teir strule to be treated wit respect and dinit.” - Ricard L.Truma, President o te AFL-CIO 47

Eighteen employers (58%) interviewed reported that labor costs are the rst to be cut when business and prots arelow because other costs, such as rent, may be non-negotiable. Such a practice robs employers, and o course workers,o the security and longevity that is gained through consistent investment in labor. Tirteen employers (42%), on theother hand, discussed various management strategies to avoid labor cuts, including scaling down portion sizes, low-ering costs that are less visible to customers, such as having cloth napkins instead o paper, or reducing hours ratherthan lay ing workers o completely.

Although several employers reported lower-wage workers’ dependence on overtime wages to earn enough to getby, many employers reported a policy o keeping overtime to a minimum, and some discussed creative strategies to



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avoid paying overtime altogether, such as paying slightly higher hourly wages overall, but not time and a hal on theovertime hours, or paying by the shit or week.

Many employers reported that they aspire to replicate the systematization and standardization characterizing chainsand ast ood restaurants, such as structured employee review policies and regular raises. However, the majority o

non-chain employers said that they gave workers occasional raises based on perceived merit rather than conduct-ing regular salary reviews. One notable exception was Jim, a amily style employer that has been in the business ormore than 30 years, who reported paying at least one dollar above minimum wage or all employees, investing 10days o training or ront and back o the house employees, and providing yearly raises and promotions to his sta.

Without the validation provided by regular reviews and raises, workers will invariably leave in search o jobs withbetter opportunities.

“Well, as long as I’ve been working in the business, there are a lot o grey areas. A lot o restaurants employ illegal aliens. Tey turn a blind eye by paying employees in cash. Tey are doing things that are ob-viously illegal. But I’ve never seen it ully cracked down upon. Here we do everything as by the booksas possible. Tat’s just the way we do it. I know that a lot o restaurants that cut corners; you don’t pay

payroll tax i you pay someone in cash. Tere are ways to get around it and it is obviously illegal. I’m

not going to judge anyone or doing that. It’s a tough business to be in, anyway to cut corners and make money, a lot o places will do it. I think some things are little more morally unsound that others. Tere are certain things that are grey areas as ar as what is right or wrong. Obviously the law states a certainthing. I’m not going to judge other restaurants but i they are mistreating their employees or i they are not giving air wage because they can get away with it, well I don’t think that’s air and I don’t con-done. As long as it’s a mutually respectul relationship and the employees are being paid or. Tere are things that happen obviously. It doesn’t happen here but I’ve worked in places where people get paid il-legal.” – Manager, 8 years in the industry, Fine Dining

When asked it i was possible to pay a living wage and stil l make a prot, many employers elt it was dicult, but notimpossible. Commitment to doing so and an acknowledgement that it was a non-negotiable overhead determined

whether or not better wages would be paid. Te examples o successul employers who have stood by such a com-

mitment demonstrate that building labor costs into operating costs rom the outset and providing living wages andbenets to workers can be consistent with success in the restaurant industry.

BENEFITS

“We do not provide many benets, other than ree ood and bonuses. My wie is the one who is more ethically minded about that than I am, I ’m like i we have money let’s do what we can do. She has some kind o healthcare or our partner, but or the employees no. We just can’t aord it. It goes back to there being no [unds or it], ater everyone’s paid and bonuses are given out, there’s no money let over. Inthe best o all possible worlds we’d like to do that.” – Owner, 11 years in the industry, Fine Dining

Restaurant employers overwhelmingly reported that it was impossible or them to provide health insurance benets

to their employees with the exception o chain/ranchise establishments,. Many employers cited prohibitive costs andadministrative burdens as the most signicant obstacle to oering benet packages. When asked i they would beinterested in a plan specically geared to restaurant businesses covering multiple employers, and particularly smallerbusinesses, a large majority o employers we interviewed indicated that they would be.

“Our wages are totally competitive. We actually conduct surveys on our own to see what our compe-tition is oering. We include hotels as well as other restaurants that we think is at our level. We lookat what they are paying their sta and then we decide, i we are not there we are going to get there.We do the same not only in hourly rates but also in benet packages. We also nd out what other peo-

ple are oering and i we don’t have that benet we make it available.” – Owner, 30 years in the in-dustry, Fine Dining



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“We don’t have 401K or any kind o retirement. We provide our managers, certain managers, withhealth insurance. We also provide Aac. We don’t pay it, but our employees can pay or that as a pay-roll deduction which is tax deductible but it reduces their taxes because they’re paying or it pre-tax but so that we oer and we oer other benets, like the kitchen sta, they all get to eat or ree during their

shit. Every year we have been open, we have also given bonuses during our holiday party in January.But last year was particularly difcult so we gave git certicates to the restaurant, so we had to be alittle more creative last year.” – Manager, 3 years in the industry, Family Style

Multiple-restaurant owners and restaurant chains are able to provide worker health benets because they are able tonegotiate good rates based on volume, while small, single-location businesses simply do not have the institutionalsize and strength necessary to absorb the costs associated with providing benets to a small number o employees.Chains and ranchises had the most standardized policies and practices with regards to benets, including sick and

vacation days. Few other employers reported oering these benets.

TRAINING

“[I spend] as much time as it takes. Because i I nd that a worker is capable, i they’re a little slow-er in the training process, that’s ne. It’s okay. Because I know at the end it’s going to be better or me.Tere’s nothing quick about training. I mean, I’m still training. I think lie in general is a training

process, so when I train employees, I take as much time, i I nd qualities in them that are acceptable to me, then I will take as much time as necessary to train that employee, because I know they’re going to give it back to me, and they’ll keep with me. So longevity is key in training. So I want that person,that investment to stay with me or awhile, so I’ll take my time training them.” – General Manager,6 years in the industry, Fine Dining

raining restaurant workers is important or health and saety reasons as well as to enhance worker productivity. raining is also an investment in workers as a means to promote mobility and longevity in the workorce. Te ben-ets o making such an investment are a well-trained sta, low turnover rates, and ultimately lower costs over thelong run. Tere is, however, a great deal o variation in the types o training available to restaurant workers acrossthe industry. Some employers agreed on the need or training – both to help a worker perorm their job and to en-courage mobility. Others ell short on providing training to all workers, ocusing on workers in the ront o the houseand not providing training to back o the house workers.

“People rom other positions are welcome to attend that training. It’s not geared toward specic posi-tions in the restaurant. It’s geared towards our mission statements, it’s geared towards providing ser-vice, it’s geared toward respect, it’s geared towards having an attitude that we try to invoke here. We can instill that in our sta, i you can instill that in your sta you can transer those skills to every po-sition ater that.” – Owner, 25 years in the industry, Fine Dining

Restaurant chains, regardless o industry segment, have ormal training systems. Tese programs range in durationrom one week to two weeks, and a ormal review that takes place anywhere between thirty to ninety days rom

an employee’s hiring date. One chain in the quick service segment in particular stated that it considered employeetraining to be the second biggest actor in its success, ater good management. Chains also spoke o cross-trainingto acilitate promotion rom within. Despite looking to chains and ast ood restaurants or inspiration in other ar-eas, most non-chain restaurant employers we interviewed generally did not ollow their lead with respect to training,generally reporting only inormal on-the-job training, and only three employers reporting a structured program.

“[We train everyone in-house], but paranoid enough about sanitation that we have an outside train-ing thing, or sanitation certication. And that is expenditure. It’s not that big a deal, but to get some-body trained or the rst time is like $200-some. But I think we ound out this time, the more you trainthe cheaper it is. So i you keep sending employees it appears that the rate goes down, we just sent a guy

or his rst training and it cost us $85. And it should have been like $250 anyway, we do more o that



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than you’re required to. You’re required to have one sanitation-certied person on site at all times. We probably have three here most o the time, we probably have 5-6 sanitation certied employees, and there’s 2-3 o us here at all times.”

O the ne-dining and casual non-chain restaurant employers who discussed training during our interviews, only

two mentioned training back o the house sta. Data rom interviews with workers and employers demonstrate that,contrary to popular perception, there is actually greater longevity in tenure among back o the house employees. In-terviews with employers demonstrate that, contrary to popular opinion there is actually greater longevity in tenureamong back o the house employees, and higher turnover in the ront o the house.48 As explained by one ne din-ing employer who has been in the industry or 12 years, “I can’t keep turnover low [in the ront o the house, but] allo the back has been with us since we opened.” Nonetheless, our data also indicates that workers in the back o thehouse are much less l ikely to be promoted, (see Chapter V: Segregation & Discrimination) suggesting that employ-ers are missing the opportunity to train and invest human capital into those employees who are most likely to stay

with the establishment in the long-term.

“Our servers always get tipped at about 20% and that’s part o why we’ve kept them. We have thiswoman who’s been with us… we’ve been open 10 years; she’s been with us about 8. Tis is her only job,

and or much o that time we were only open breakast and lunch, and that’s what she works, breakast and lunch days, uesday through Saturday and is happy with what she makes, apparently.” – Owner,10 years in the industry, Fine Dining

Some employers recognize the value o training all sta – not just those who regularly interace with the public or who represent the “public image” o the restaurant. One owner who has been in the industry or seven years reportedproviding training to all employees, treating training as an investment, and even spending “as much time as it takes”to train her employees. According to the owner o this ne dining establishment, “training is a process, so when Itrain employees, I take as much time, i I nd qualities in them that are acceptable to me, then I will take as muchtime as necessary to train that employee, because I know they’re going to give it back to me, and they’ll keep withme. Longevity is key in training. So I want that person, that investment to stay with me or awhile, so I’ll take my time training them.” Tis employer also clearly recognized the importance o training good managers, to avoid man-agement’s non-compliance with the law, verbal abuse, and other behaviors that might create greater liability or theemployer. Te onus alls upon ownership to ensure that management helps them remain o the low road.

E. Conclusion: The High Road is Possible“I’m going to guess about 30% o [my workers have received promotions]. A lot o my sta now started as buss boys and are now waiters. Some o them are my best waiters and some o them actually started as dish washers. Some started as dish washer and became bussers and then became expediters and thenbecame ood runners and then became servers and bartenders and then became banquet captains. We have a number or had until recently a number o managers here who started out as bussers and now I have a busser who is now our general managers, upstairs in the our other restaurant. You see the op-

portunity, you have to be prepared or it, put yoursel in that position and when that opportunity comes your way its to be considered or. Ater that really the sky is the limit.” – Owner, 22 years in the in-

dustry, Fine Dining



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Te Restaurants at te East Ban Club, Maxwell’s at te Club and te grill, are some o Cicao’s fnest establisments and EBCbeliees tat its success is due in lare part to its loal emploees. “Te most impor tant tin or us is not to ae turnoer….it isn’t about me, i t’s about tat relationsip tat tat ser er, busser, ost/ostess, bartender, wateer, as wit te member(customer),” sas Mie.

Mike Romano grew up in te restaurant industry, and as been operating te Food and Beverage Department at te EastBank Club or 23 years; in all is time tere te East Bank Club as been committed to investing in its sta. Workers at teEast Ban Club’s restaurants receie ier tat industr waes, “Our sta is main anwere between $7-$10/r as a serer,te compan pas tem ier to eep tem ere, we realize we’re onl as ood as te are, our reputation is made b toseemploees,” Mie states.

Ater 30 days all restaurant sta receives Blue Cross and Blue Sield medical/dental coverage, a 401k in wic up to 2% ismatced b te compan, ree ESL and oter trainins. Restaurant sta at EBC also receie 7 olidas tat i wored result indouble time pa, 6 paid sic/personal das a ear, and escalatin acation, ater 1 ear 2 wees, ater 5 ears 3 wees, and ater10 ears 4 wees. Te benefts are not onl monetar but EBC frml beliees in proidin its emploees wit te opportunitto moe up witin te compan, “One o te manaers o te operation is a twent ear emploee tat started as a serer…we alwas tr to oer s tu to te emploees tat are ere frst… we don’t need to o to te outside unless we absolutel aeto,” states Mie. A lare majorit o emploees at East Ban Club’s restaurants ae made a career as a restaurant worer, andtenures o 10 ears and aboe are not uncommon.

Low road practices ultimately have cost implications or businesses as a result o constant turnover as workers leaveto nd better paying jobs with better workplace conditions. urnover has been shown to negatively impact produc-tivity and protability, thereby resulting in realities contrary to employers stated goals. 43

Some employers reported that low road practices implemented by their competitors, such as minimum wage and over-time violations, had the eect o undercutting them. High road employers lose business to those pursuing the low roadas the latter benet rom unair competition by violating the rights o workers. Tis ultimately damages the industry as a whole and the public at large by pushing industry wages down even urther, harming the very workers on whomtheir protability depends, and spawning the prolieration o low road practices across the industry. Te end result, asurther explored in Chapter VI: Te Social Cost o Low-Wage Jobs, is an increase in “hidden costs” to the public.

Employers would benet rom greater awareness o their obligations towards their workers and o the value o imple-

menting “pro-worker” practices, as well as more guidance in employing better business strategies. Further study inthis area is also needed, particularly regarding the impact o low road practices on the prolieration o low-wage jobsand on employers pursuing the “high road.” Insights rom empirical investigations or solutions to these problemsare needed to help the Chicago restaurant industry realize its ull potential as a source o both revenue and employ-ment to the Chicago metro area.

“[We oer] health insurance denitely, dental, eye care, counseling all o the above. Again they can invest on the 401 k, we contribute to their 401k. We have progressive disciplines all mapped out or them in their orientation and it’s in the employee handbook. Again the more you have invested in an employee, especial-ly in this environment because it is a private club the members get to know their servers, they get to knowtheir bartenders, they get to know their managers and they lose that person, they’re still asking or themweeks later. You know what ever happened to so and so. Not to mention that they have developed rela-

tionships a connection to those members. Tey have greater menu and wine knowledge, POS knowledge so it obviously expedited that process.” – Manager, 10 years in the industry, Fine Dining



C h A P T E R v

Segregation & Discrimination



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C h A P T E R v

Segregation & Discrimination

Our interviews with both workers and employers show that the experiences of restaurant workers across theindustry are not uniorm. Across various types o restaurants and employers, there is a stark division between thetreatment and experiences o the workers in the ront o the house and those who work in the back o the house. Ad-ditionally, actors such as gender, race, ethnicity, national origin, and immigration status have a signicant impacton the nature and quality o the experiences o restaurant workers.

Our research indicates that:

Jobs in the restaurant industry are divided between those in the ront o the house and those in➜

the back o the house. Earnings, benets and workplace conditions difer considerably betweenthe two.

White and U.S. born workers are employed primarily in ront o the house positions, while the➜

vast majority o immigrant restaurant workers are ound in the back o the house. As a result, theimpacts o poor working conditions in the back o the house all disproportionately on workerso color.

Race appears to be correlated with wages and upward mobility in the restaurant industry.➜

Some employers discriminate in hiring and promotion.➜

Several workers reported experiencing verbal abuse based on race, gender, language, or sexual ➜

orientation. Tey also reported being disciplined more oten or more severely based on their race,gender, or sexual orientation.

Te inormal economy is important to the restaurant industry. According to employers, undocumented workers are

ound in signicant numbers in the industry because they are more likely to work or lower wages and under worseconditions.



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A. Introduction Te nature and quality o restaurant work in Chicago depends on various actors, including the type o restaurant,its location, and the employer. It also depends on the type o job and the value the employer places on the work per-ormed. Our worker and employer data indicate that wages and working conditions also depend on a worker’s race,

gender, national origin, and immigration status.

Our research suggests that occupational segregation and discrimination, both in its apparent and more subtle orm,is evident in the Chicagoland restaurant industry. Historical discrimination, residential segregation, and current dis-crimination in the industry mean that, in large majority, those with living-wage jobs are disproportionately white,and those with low-wage jobs are disproportionately immigrants and people o color. While the public at large isgenerally most amiliar with overt orms o discrimination, more subtle and less recognizable discrimination occurs

when seemingly neutral policies have a disproportionate impact on a particular group. For example, white workersare overrepresented in living-wage ront-o-house positions, and while workers o color are never overtly told thatthey will not be hired in these positions due to their race, the result o seemingly innocuous hiring practices overtime results in occupational segregation by race.

Because workers’ experiences o discrimination were not the primary ocus o this study, our surveys and interviews

provide only a glimpse into these issues. Te Chicagoland Restaurant Industry Coalition plans to conduct additionalresearch in this area in the coming year, and strongly encourages both industry and worker analysts and advocatesto pay greater attention to these issues.

B. Segregation by Occupational Structure, Industry Segment &Geography in Chicagoland’s Restaurants

“It’s especially in the ront, there have been times that… almost everybody, the majority on the oor inthe ront are white.” – Owner, 11 years in the industry, Fine Dining

Jobs in the restaurant industry essentially all into one o three categories: ront o house workers, back o the house workers, and managerial and supervisory positions.

Our research indicates that workers’ positions within this hierarchy determine their earnings, benets, opportu-nities or training and advancement, and working conditions (see able 15). Front o the house workers generally earn higher wages and have greater opportunities to increase their earnings through tips. As indicated by the datain able 15, 47.2% o all ront o the house workers surveyed reported a living wage (more than $16.48 per hour)compared to only 8.3% o back o the house workers. Additionally, more back o the house workers are subject tounsae working conditions where they are at greater risk o injury and illness. Tey are also less likely to be aordedbenets such as health insurance and sick and vacation days, or receive health and saety training. Yet they experi-ence a greater percentage o unsae working conditions and workplace injuries, such as exposure to toxic chemicals(14.1%), cuts (55.6%), and burns (63.1%).

Tere are, o course, some dierences in wages and work quality among positions within each side o the house (see able 15). For example, although both occupations would be classied as ront o the house positions, compensa-

tion and working conditions dier considerably between bussers and servers. A closer examination o the 27 work-ers who reported earning less than minimum wage reveals the ollowing: 4 were dishwashers, 10 were line cooks,and the remaining workers ranged in ront the house positions, with 4 o them working as bussers and 1 as a server.Furthermore, bussers earn the lowest hourly wage among all ront-o-the-house positions. From the workers we sur-

veyed, bussers reported an hourly median wage o $8.26, much less than even the lower paying positions in the back o the house, such as prep cook ($9.88), line cook ($9.26), and dishwasher ($10.00). However, our analysis ound thestarkest disparities between ront and back o the house positions. Te median hourly wage reported by ront o thehouse workers was $15.33, while back o the house workers averaged $9.50 per hour.



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TABLE 15: Dierences in Job Quality by Restaurant Job Type

Front o the house jobs Back o the house jobs

Wages

Less tan minimum wae 3.9% 7.7%

Under poert line 3.5% 21.4%

Low wae 45.4% 62.5%

Liin wae 47.2% 8.3%

Total 100% 100%

Race

Wite 40.4% 14.3%

hispanic/Latino 23.8% 57.7%

Blac 17% 16.7%

Asian 9% 6.5%

Mixed 6.7% 3.6%Middle Eastern 2.2% 0%

Total 100% 100%

Workplace Conditions

Do not ae ealt insurance 59.4% 64.3%

Experienced oertime iolations 35.9% 35.1%

hae not receied on-oin job trainin rom emploer 40.3% 30.3%

Wored wen te restaurant was understaed 83.6% 74.9%

Unsael ot in te itcen 23.8% 32.0%

Did not receie ealt and saet trainin 33.9% 33.3%

hae done sometin tat put own saet at ris 33.3% 37.8%

hae done sometin due to time pressure tat mit aearmed te ealt and saet o customers

26.2% 23.5%

Workplace Injuries

hae been burned wile on te job 30.5% 63.1%

hae been cut wile on te job 42.5% 55.6%

hae slipped and been injured wile on te job 10.8% 11.8%

hae come into contact wit toxic cemicals 9.4% 14.1%


“I’m sorry, come on, let’s state the obvious. Kitchen people are mostly Hispanic people, and bussers are also the Hispanic people. Te ones with the least communicational English. Servers are just, depend-ing on the place, it could-- just know how to speak and you can be a server, but then there’s other plac-es where it takes more charisma and it takes more than just wanting to have a job.” – Female, 3 yearsin the industry, Server

“I’ve been interviewing and job hunting or the last ew months and or example, I’ve noticed that all o Lincoln Park, on craigslist will all be like-- send photo with resume, photo with resume, photo withresume. And you know, I used to think that to have a resume as a server was the biggest joke, like se-riously?” – Female, 4.5 years in the industry, Bartender



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TABLE 16: Race Breakdown by Restaurant Job Type

Non-HispanicBlack

Non-HispanicAsian

HispanicNon-Hispanic

WhiteAll Workers

Front o the

House Workers

57.6% 64.5% 35.3% 78.9% 57.5%

Back o theHouse Workers

42.4% 35.5% 64.7% 21.1% 42.5%

Total 100% 100% 100% 100% 100%


As indicated in able 16, our survey data shows similar concentrations o white workers in ront-o-house positions,and workers o color in back-o house positions. O all the workers in back o the house positions, 57.7% o them

were Latino, 14.3% o them were white, 16.7% o them were Arican-American and 6.5% were Asian (see able15). An overwhelming majority o all back o the house workers were people o color (85.8%). When examining

workplace benets oered to each position, these dierentials are even more striking. While less than one-tenth o all workers surveyed received health coverage through their employer (9.5%), o the 51 workers that were insured,

37 o them were ront o the house workers (5 occupied management positions). A total o 57 workers also reportedreceiving paid vacations and 34 o these were ront o the house workers (5 occupied management positions). Tus,

white workers are more likely to land in ront-o-house positions with greater access to benets.

“And I’ve noticed that they ollow a trend, that i it’s always this type that lls that position it seemslike, then that, it’s almost looks i it was that they elt that women could only be servers then I would

go into a restaurant and they would all look like me. So whatever, like i it was the dishwasher or the busser, then that’s one o the things I like about my current job, that’s not the case. I was blownaway when I saw women dishwashers. wo! Floored. And saw multi-colors, and I had two Arican-

American managers. I was like, ‘Oh my God, I’m at home! Oh my God!’ Yeah, it was great. It was great. But that is the exception. Everything else is, we always had Hispanic dishwashers, Hispanic bussers, the servers are under 35, and young, and white. And the managers are white.” – Woman, 12

years in the industry, Bartender

Additionally, back o the house workers reported more requently than ront o the house employees that they hadbeen injured on the job. While these results can be explained in part by the greater health and saety hazards asso-ciated with positions requiring use o sharp instruments and work near hot ovens or with toxic chemicals, they alsoappear to be related to workplace practices. Despite the act that they work in more dangerous environments, 33.3%reported that they did not any receive health and saety training (see able 15).

SEGREGATION BY SEGMENT

“In ast ood they thought that the women could better handle the stress. We’re better at customer service.Like she said the males they would rather have jobs where they don’t have to think or deal with people.

I thought maybe it should have been rotating. You know, everybody should get a piece o the stress and the maintenance. Tat’s how I elt.” – Male, 1 year in the industry, Prep Cook

While all restaurants are in the business o serving their guests a meal, actors such as ambience, type o service,and type o targeted patrons segment the industry into three categories which vary markedly with respect to wages,

working conditions, and workorce composition. In this report, we categorize those segments as “quick-service” orast-ood, amily-style and ranchise, and ne-dining or “tablecloth.”

Te industry has the potential to provide living-wage jobs, particularly in the ne-dining segment o the industry.From our survey data, the most signicant dierence between the segments was wage. Te median wage dierentialreported by workers was signicant. Fine-dining workers averaged $14.61 per hour, while workers in amily-style



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establishments averaged $13.50 per hour and workers in quick-service averaged $9.00 per hour. 22.3% o all workerssurveyed reported earning a living wage, or more than $16.48 per hour. Many workers reported earning more than$50,000 per year, and some above $100,000 annually. It is the $40 price point per meal at these establishments, along

with higher tips, that oers employment with higher earnings than the other two segments o the industry.

Our data indicates that race is also a mediating actor in gaining employment in particular segments. Eight out o ten survey respondents (80%) working in the quick service segment were a person o color. More specically, 58.2%o all Arican Americans workers surveyed were concentrated in quick-service jobs earning a median wage o $9.00per hour.

C. Racial Disparities in Wages & Working ConditionsAs described in the sections above, the restaurant industry in Chicago is segregated by position and segment, andthis segregation occurs mainly along racial lines. Workers o color reported lower median wages and higher rates o employment law violations and lack o access to benets than white workers. Whites in our survey reported a medianhourly wage o $14.56, while workers o color reported a median wage o $10.00 per hour.

In addition, workers o color reported experiencing signicant employment law violations compared to white work-

ers. Findings rom workers surveyed indicate that 84.6% o those who reported not being paid the minimum wage were people o color, even though workers o color comprise only 72% o our survey sample. In addition, 5.4% o allpeople o color did not earn the minimum wage, compared to 2.6% o white workers in our survey sample. 38.5% o Arican-American workers surveyed reported experiences o not being paid overtime, compared to 37.6% o white

workers, and a quarter (25%) o Middle Eastern restaurant workers experienced management taking a share o theirtips, compared to 16.5% o white workers.

Neither Census and other government data nor our survey data can completely represent the reality o occupationalsegregation or restaurant workers by race, or a variety o reasons. One reason that Census data has limitations withregard to immigrant populations is that immigrants are less likely to speak to government surveyors or reasons o language barrier and ear. However, Census data is also limited with regard to non-immigrant low-income popula-tions, which are generally undocumented or a plethora o reasons, including lack o access to telephone and othermeans o communication, lack o stability o address, and more. Further research into how discrimination based onrace, ethnicity, and immigration status aects Latino and Arican-American workers is clearly needed – particularly given that segregation is not obvious to the single worker, and discrimination can be subtle. Tese experiences donot appear to be adequately addressed by current government data.

D. Discrimination in Hiring and Promotion“You never know what kind o picture you’re supposed to send. Like a glamour shot? A webcam pho-to?” – Female, 2 years in the industry, Host

“It was pretty well balanced. Well, all o the managers were white men, but aside rom that every-thing else was balanced and age-wise too, it was pretty mixed .” – Female, 5.5 years in the industry,Server & Bartender



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JOB ADS FOUND ON CHICAGO INTERNET BULLETIN BOARD ON CRAIGSLIST

Brteers Serers (mrt Gre)Date: 2009-12-16, 3:49PM CST

[Famil Stle Establisment] is now irin experienced bartenders and waitresses. We are looin or un eneretic irls tatwant to ae un in te wor place as well as main our uest ae un. We ae ull time and part time positions aailable. I ou ae a reat personalit and a ard worer we are willin to train te rit person. Bartenders ou don’t need a license tobartend. No need or a resume i ou ae one tat’s fne. I interested please appl in person and as or a manaer an time11am - 12am an da

Licl prk High vle Br: Brteers/Serers (Licl prk)Date: 2009-12-08, 5:15PM CST

We are currentl looin or bartenders and serers tat ae a s tron social networ and lie in or near te Lincoln Par area.Our current sta is oun, eneretic, ard worin and attractie. Experience preerred but willin to train te rit person. I tis is ou and ou ae a s tron social ollowin please send a picture and a sor t pararap o w ou are te rit person.

Witresses WteDate: 2009-12-01, 2:00PM CST

[Famil Stle Establisment] is looin or un, enerenic irls to waitress at our ast-paced Lincoln Par taern. All applicationsare to be submitted trou te Craislist ad. Submit a resume and a picture. NO PhONE CALLS!!!!!!!!

Our interviews with employers revealed that they actively seek “attractive individuals” or better paying, better qual-ity ront o house restaurant jobs. Hal o the employers we spoke with told us that attractiveness, “personality,” andability to interace well with clientele were priorities when hiring or positions in the ront o the house. A matchedpairs audit testing study o discrimination in New York City’s restaurant industry indicated that measures o “at-tractiveness” include race, national origin and skin color50, all lega lly prohibited orms o employment discriminationunder ederal law.51 As a result, discrimination in hiring or ront o house positions, however unconscious, likely contributes to the racial disparities between those employed in the ront o the house and those working in back o the house positions.

“Yeah, in the two ne-dining restaurants, because aside rom this I had no problem, it was only when I tried to work downtown. Te reason was, oh you haven’t had this many years o ne dining, it didn’t matter, or just serving experience, which was a little bit upsetting or me, because I elt like the kind o serving I did was a lot more difcult than I knew it was at a Finnegan’s or a GIFs, not to say that

I thought it was better, just it was a lot more intense. But that’s usually what they say, or sometimesthey don’t say. Um, a couple o times, they said, well, they said something, but it was just BS, so I just stopped listening ater that. But my theory is that, they just wanted someone to come in and say, I’ve been working or like nine years, so that’s pretty much it.” – Female, 9 years in the industry, Server

“Probably the whole issue about they want to hire pretty, skinny, hot girls. And i you don’t t, youdon’t have a good o a chance at getting hired. And it’s not air, you can do the same things they can do,

you can probably do it better because they know that they can make easy money and they don’t have towork that hard or it. And obviously we’re all going to use what we have to our advantage and I’mnot saying that they’re wrong or doing it. But i they’re allowing them, i they’re put in the positionto make more money just by their looks. I don’t think almost everyone woman can do it.” – Female, 7

years in the industry, Host

Conversely, when hiring or back o the house jobs, “work ethic” was the characteristic most commonly cited asimportant by the employers with whom we spoke. Further inquiry revealed that employers’ perceptions o an em-ployee’s work ethic generally related to wil lingness to work long hours or low wages, perorm tasks that others werenot willing to, and work under poor working conditions. Te act that back o the house workers are largely workerso color and immigrants suggests that employers’ hiring decisions with respect to back o house positions are based,



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even subconsciously, on racial perceptions o who possesses the type o “work ethic” they are reerring to.

When asked about the demographic breakdown o employees in ront and back o house positions, several employersresponded that they hired those “who applied.” While they were aware that ront o house workers are predominantly

white and back o house sta are overwhelmingly people o color, they maintained that any disparities were a result

o the act that blacks and other people o color apply primarily or back o the house positions.

“I remember we were in a otel, doin caterin and te Blac Caucus was tere. One o te manaers, se turns around andse sas, ‘o ‘D,’ do ou now i te want ranc dressin or blue ceese dressin?’ I’m lie, Wat te ec is wron wit ou?And se was lie, um, and se ased eer sinle Arican-American person tere. Se ased us i te wanted ranc or blueceese, or ot sauce but te ordered raspberr inairette. I looed at er lie se was craz . Lie did ou just as-- did oueen just come close to asin tat? And I uess because te et a lot o comments about tem bein racist. So tat wolewee te put us, put all te Arican-American people in te ront. We osted eer eent, at te ead o te table, to let tem,to sow tem tat e, we aren’t racist. So we’re oin to sow ou tese tree blac people. An oter time we would aebeen doin our own tin, but tis eent, we ad to be mainstream in te ront. We couldn’t do cer tain tins because we adto do ood. I we wanted to be on te sidebar doin sometin else di erent, no. I tin te ad a spaetti and catfs line.Te made us sere. W te ec were we serin spaetti and catfs? And oter people would be lie, can we sere, canwe sere? And te would be lie, no. you ae to sere. And I would be looin lie, I don’t een lie spaetti lie tat to beserin it. And te would be lie, no but te tin we’re racist, so ou ae to stand in ront o te line. It’s lie, wow. And Itin m best riend commented on it. And se said, o, I’m not bein racist. M cild is actuall Arican-American. And I’m lie,wat te ec? So it was er racist, and it was racist all te wa trou. We staed or lie, I tin I wored tere or lie treeor our monts, but it was-- wen we frst arried it was lie o m od ou us arried. Te were starin at us so ard. Butou now, ou ae a job to do and ou do it. you tr to mae sure tat ou eel comortable. So i ou didn’t eel comortableat te time, ou stated tat and ou stated te reasons and we ot apoloies and stu, but te een too our tips. I tineer time we sould ae otten a tip, because lie te Blac Caucus let us tis bi tip. I uess te were trin to portratat te weren’t racist, so te let te tip to te Arican American people. Te let our tip and te too our tip. And tente said tat te didn’t ie tips. It’s lie, I just ot a tip a couple o wees ao. Wen te too our tips I was so ur t. I justwanted to ill er because I needed tat tip mone, but it appens. you just ae to simmer down and sta true to wo ou are.”– Female, 3.5 ears in te industr, host & Serer

Our data indicate that the stark dierences in job quality between ront o house and back o house positions arecompounded by a general lack o mobility between the two types o positions. In act, many workers described a

“glass ceiling” between the back o house and ront o house positions, which was extremely difcult to break through. O al l workers surveyed who never received a promotion, 71% were workers o color. As a result, once hiredin back o house positions, workers are essentially trapped in the back o the house positions receiving low-wages.On the other hand, workers told us that promotion rom ront o house positions to supervisory or managerial posi-tions was relatively common, even though wages or managers tend to be much lower.

TABLE 17: Barriers to Promotions Reported by Restaurant Workers

Responded that in the past 12 months they or a co-worker had been passed over ora promotion

25.7%

O those who reported being passed over or a promotion…

Reported that race was a actor 42.8%

Reported that language was a actor 26.2%


E. Verbal Abuse and Discipline Based on Demographic Variables“I’ve been yelled at by a ew managers, one o them yelled at me really because he was having personal

problems that day. Who knew, and he was yelling at all o the servers, and he has control o his tone o voice issues I guess. I had asked him or one o the later shits, one o my co-workers with child wanted to take my shit. And I said I wanted it, but I would give it up because I was trying to be acilitating o her greater nancial burden. And he yelled at me out o hand, when I said, ‘would it be ok i I switched this shit with Keisha?’ Really, really, really out o hand and ridiculous and disrespectul. I have very



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rarely been spoken to in the way that he spoke to me. Other times, things like, just little disrespectul things were very common. A lot o rumors get started by co-workers about other co-workers’ sexualityall the time. But that’s just like small stu.” – Female, 1.5 years in the industry, Bartender

Workers we surveyed reported requent verbal abuse (see able 18). About one third o the workers who reported

such abuse believed that the verbal abuse to which they or a co-worker had been subjected was motivated by race,gender, language or immigration status.

TABLE 18: Verbal Abuse Reported by Restaurant Workers

Responded that in the past 12 months they or a co-worker had experienced verbal abuse 30.9%

O those who reported experiencing verbal abuse…


Reported that gender was a actor 28%

Reported that language was a actor 21%

Reported that immigration was a actor 21%


Similarly, among restaurant employees who believed they or a co-worker had been disciplined more oten or moreseverely than other workers within the past year, 21.9% cited race, language or immigration status as the reason.

TABLE 19: Discipline Reported by Restaurant Workers

Discipline Reported by Restaurant Workers Percent o Workers

Responded that in the past 12 months they or a co-worker had been disciplinedmore oten or severely than others

21.9%

O those who reported more requent or severe discipline…


Reported that language was a actor 21.4%

Reported that immigration status was a actor 21.4%


F. Gender Discrimination“I actually have trained someone or the position I was qualied or. I’ve done that and it was inu-riating, but basically the way the restaurant where I was working was structured, my general man-ager only hires men or the bar, and would be really rude, generally to the emale employees. And thisis across all the women who work there. And he hired, I wanted to be promoted to the bar, I’ve done it and I know how to make all o our drinks, and that’s something each restaurant does a little dierent-ly, and he hired somebody who had gone to bartending school but had never had any serving experi-

ence, and I ended up training him not only on the oor but also on the bar. o not get the job. It wasvery rustrating .” – Female, 1 year in the industry, Barback

“I think because, I can speak rom a restaurant that I worked at or seven years, they had a boys club. Tere was no getting into the boys club and the only way that women were able to get around it was they creat-ed their own girls club. Tey were the catering managers, so i they had any power in the organization it was catering, and that’s it. It was always to be a boys club. Tey didn’t know how to train women eec-tively, they didn’t know how to support women eectively, and they did want women in these positions.

I mean straight out just blatant discrimination.” – Female, 20 years in the industry, Bartender

Sixteen percent (16.2%) o respondents surveyed reported experiencing sexual harassment. However, the severer sto-



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ries told to us in longer worker interviews indicate that gender discrimination in general was very under-reported tosurveyors in our study. Many women we interviewed commented on expectations to respond to sexual advancements,and the high level o firting required o them on the job. A ront o the house worker explained that her scheduledepended on the discriminatory practices o management: “I let a restaurant a year ago, where they did a schedulebased on the che ’s preerred servers. And it was the white straight men, then it was the gay men, and then there werethe women at the bottom.” O respondents reporting experiences o sexual harassment, 21.6% reported it was basedon sexual orientation. One ront o house worker who was demoted explained: “in my restaurant it’s mostly whitebut one o the waitresses knew that I was (ahh) gay, and she said she got along with gay people, but then I ended upin the back. I have no idea why they decided to put me with all the Mexican workers in the back.” Women workers

we interviewed oten described the back o the house as a place where explicit sexual comments could be made andeven physical contact in inappropriate ways.52

“I have been harassed. At the time at I was scared, I didn’t know what to think so I didn’t, I didn’t thinkabout it in a moral sense. We did have a problem with our kitchen. I mean usually, most o the time, it might be an immigrant, or someone who didn’t really speak-- so I didn’t know what he was saying some-times to me, so I would just be there all smiles, so I didn’t know at rst. But I’ve been cornered in the big rerigerator like cornered there a couple o times. Literally. It was a really scary thing, but because o the

way I am, and how I handle stu, I just try to be really nice to people. Now that I think about it, as anolder person, I probably would denitely have an issue with that. But then, I was new, and I was think-ing like, well maybe he does this to everybody. But I don’t think he did. Ten once I learned some Spanishand I ound out what he was saying to me, I was like, oh this is really bad. Tis is like the denition, the textbook denition o sexual harassment. But you know, sometimes that does happen, and you don’t re-alize it. Especially since never once or me did I assume that he was saying anything bad to me, because I didn’t understand what he said. But yeah, and I’ve seen it even worse than that. I have seen a couple o managers or ches, like at the last place I worked we had an open kitchen, so you worked directly with your che. Tere are no cooks, technically, and I denitely saw what i it was me, I would have thought that it was sexual harassment .” – Female, 6 years in the industry, Server

“Tere are so many things. Like when the manger said to the hostess that she should only wear high

heels. I’ve encountered so many. Tis is when I was younger, having a manager brush up against youat the POS system. Te tickle – I cannot stand the tickle, because ‘I’m a girl and I must be so cute, so I must want to be tickled,’ the inappropriate touching. Tis was back at the steakhouse, it would be con-stantly…the guys would talk about table 44’s breasts, or how ater the Christmas party they went tothe strip club with the managers.” – Female, 7 years in the industry, Server

Many o the women interviewed explained that restaurants requently exclude women rom certain positions, par-ticularly the most lucrative wait sta and bartending positions in ne-dining restaurants, and instead concentratedthem in lower paid positions at particular establishments. Women o color were also highly concentrated in the quick service segment o the industry. Over hal (57.7%) o all Arican American women surveyed held jobs in the quick service segment, where the average hourly wage is $9.00. Our data also indicated that 34.5% o women experiencemore verbal abuse, and 74.6% had never received a promotion.

“A co-worker…Yeah, she let. Tey didn’t even re him, she let because he was so bad. Because his un-cle, who had gotten him the job, was a server who’s been there or over twenty/twenty-ve years. So

I think that had something to do with him not getting red. I mean, I wouldn’t have been able to see him every day. Tere’s a little group, and they wouldn’t even be discrete about it. Tey would just saywhatever was on their head at that very moment. Even with the customers. Te guys would run intothe back and ‘Oh my God, table our,’ and then another one would be like, hey let me go look. And theyseriously would rom all the way over there come and tell about, hey, you’ve got to go see this girl, or

you’ve got to go see this, so they all go, like oh yeah, yeah. What do you get rom that? Are you going to get a better tip? Probably not, you’re going to get a worse tip because you’re just being perverted and being obvious.” – Female, 4 years in the industry, Server



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Additional quantitative and qualitative analysis o women’s experiences in the industry, and particularly those o wom-en o color and immigrant women, is clearly needed. Te Chicagoland Restaurant Industry Coalition plans to urtherexamine the role o gender in an upcoming in-depth study o discrimination in Chicago’s restaurant industry.

Nael, Mexican Immirant, serer

I came to te US rom Mexico 10 ears ao, I lie ere wit m moter and sister and am a sinle moterraisin m son. I ae been worin in te restaurant industr or 4 ears. I started as a tortilla eater andperormin oter eneral bac o te ouse duties, and am now a bartender and serer. In te our earstat I ae been worin in te restaurant industr I ae alwas otten paid wateer te minimum waeis at te time, and te onl time I ae receied a raise is wen minimum wae oes up. I ae neer adealt insurance, and I ae neer receied paid sic das. Not ain benefts as ad a bi impact on mlie, i I et sic I ae to decide between ettin better and proidin or m son because I cannot aordto not et paid or a da, i m son ets sic I ae to decide between tain care o im and proidin orim. I loe te restaurant industr but because it does not proide career benefts I am orced to sacrifcem well bein and orced to mae tou decisions reardin m son’s care. I want to moe up witin te

industr but sometimes it seems lie it is impossible, at m places o emploment tere as been little opportunit to moeup and I cannot leae m job to loo or sometin else because I ae to tin about raisin m son and proidin or mimmediate needs. I also am discouraed because I don’t ft te profle o restaurant manaement or o adanced positions ineneral, I ae te experience and am completel competent in Enlis but I rarel see Latinas in power positions.

G. Disparities in Wages & Working Conditions Based on Immigration StatusImmigrant workers in Chicago are more vulnerable to exploitation due to language barriers, lack o inormationabout their rights, and ear o detention or deportation. Immigrant restaurant workers in our sample reported higherrates o employment law violations than U.S. born workers. Eight percent (8.4%) o immigrant workers also experi-enced minimum wage violations, a percentage rate that was three t imes the rate o U.S. born workers. However, ed-eral law states that all workers have the right to minimum wage and overtime protections, regardless o status. 53 Onaverage, immigrant workers averaged $9.00 per hour, compared to $12.00 reported by workers born in the U.S.

Immigrant workers also reported a higher rate o health and saety violations than U.S.-born workers. As shown in

able 20, 39.2% o all immigrant workers reported working in restaurants did not receive health and saety training, yet a higher percentage o immigrant workers worked in unsae conditions and did something that on the job thatput their own saety at risk.

TABLE 20. Immigrant Workers and Health and Saety Violations

Percentage o immigrantworkers

Percentage o U.S.born workers

Percentage o entiresample population

Unsaely hot in the kitchen 30.3% 23.4% 25.7%

Fire hazards in the restaurant 23.6% 15.1% 18.1%

Missing mats on the foor toprevent slipping

23.5% 17.8% 19.7%

Missing guards on cuttingmachines 28.4% 25.6% 26.8%

Done something that putown saety at risk

34.5% 33.7% 33.6%

Did not receive instructionor training about workplacesaety

39.2% 28.2% 32.3%




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Luis, 10 ears in te industr, Coo

I ae been worin in te restaurant industr or 10 ears alwas oldin a bac o te ouse position,usuall worin as a coo. In all m time in te restaurant industr I ae onl been paid minimumwae and te most I ae eer otten paid is $10/r. despite ain 10 ears experience. I also aeneer ad ealt insurance or paid sic das. I I et sic I tae oer te counter medicine to tr and etbetter, I am onl able to o to te doctor i I eel te illness is reall serious. I ae been burned on te job seeral times and because I am not able to o to te doctor I onl put on burn el and continue towor because I am not able to tae te time o and am not able to pa te medical expenses. OnceI called in sic because I ad a eer and was eelin reall ill, I ad neer called in sic and ad eenound coerae or m sit and despite tis I was still punised and remoed rom tis particular sit.I wor wit ood and want to protect te customers and m co-worers; I do not want to spread merms. I also wor 6-8 our sits and do not et a lon enou brea to sit down and eat a meal. In

m experience because I wor in te i tcen, manaers tend to ell at us, arass us, and treat us lie we are not een uman,lie we are teir pet.



C h A P T E R vI

The Social Cost o Low-Wage Jobs



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C h A P T E R vI

The Social Cost o Low-Wage Jobs

Absent rom much o the data and discourse regarding the restaurant industry is an assessment o the cost to con-sumers and taxpayers alike o low-wage jobs with ew benets and poor working conditions. While hidden, thesecosts are signicant, ranging rom increased public health risks to employers pursuing low road practices throughsocial saety programs employed by some restaurant workers to make ends meet. A key nding o our research isthat whenever restaurant workers and employers are hurt, so are we all:

Low road workplace practices ultimately harm not only workers but restaurant consumers, em-➜

ployers pursuing the “high road,” and the public.

Restaurant employers who violate labor and employment laws are also more likely to violate health➜

and saety standards in the workplace.

Violations o employment and health and saety laws place consumers at risk and endanger the➜

public health.

Failure to provide health insurance and paid sick days to restaurant workers can lead many to delay ➜

seeking primary or preventative medical care, ultimately increasing health care risks to workersand consumers, and contributing to increased health care costs.

Poor health and saety conditions in restaurant workplaces, combined with low wages and lack ➜

o employment-based health insurance, increase costs o providing emergency care to uninsuredindividuals at public hospitals, thereby ultimately decreasing the availability o ree health careservices or those in need.

Low wages and lack o job security among restaurant workers lead to increased reliance on un-➜

employment insurance and social assistance programs such as welare and housing and child care

subsidies.



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A. Introduction“Te prolieration o low-wage jobs has an impact on public budgets and the availability o public servic-es. Tose earning minimum wage would qualiy or and would need to rely on a number o government

programs in order to make ends meet.” – Hidden Costs: Te Public Cost-Wage Jobs in San Diego54

Te low road workplace practices described in this report have impacts beyond those aecting members o our com-munities who are employed in the city’s restaurant industry. Predictably, they aect the quality o the ood we eat

when we dine out at an eating establishment in Chicago. In some cases, they can lead to increased risks to publichealth. Tey also have more ar-ranging – and more hidden – eects on the local economy, social saety net, andultimately, the local taxpayer.

Restaurant employers who violate labor and employment laws are also more likely to violate health and saety stan-dards in the workplace. Tese low road employers put the saety o the public at risk by overworking their employees,pushing them to cut corners, requiring them to do jobs they have not been trained or, ailing to provide basic healthand saety training, and creating conditions leading employees to work when they are sick or injured. Te health andsaety o both workers and consumers is compromised as a result.

Workers who do not have employment-based health coverage and cannot otherwise aord insurance delay accessingtreatment, oten leading to the development o more serious medical conditions requiring more costly medical care.Because they receive low wages, they are generally unable to pay or the cost o that care, increasing uncompensatedcosts incurred by public hospitals. Furthermore, when workers are unable to earn enough to support themselvesand their amilies through their jobs, they are orced to rely on public saety net programs to make ends meet. Teresult is a “hidden cost” o the restaurant industry in the orm o indirect public subsidies to employers who do notpay adequate wages.

B. Endangering Public Health“I’ve called, I actually was throwing up, I called my restaurant, I work evenings, and said I was sick.

And they told me to come in anyway, which was really, really unsanitary. And miserable. And oth-

er times when I’ve had colds, I would think that my management would not want me. I’m glad I’mthere working, because otherwise I wouldn’t be making money. I want to go in unless it’s really, real-ly out o the question, but I don’t really think it’s sanitary or a place that serves ood .” – Female, 1.5

years in the industry, Bartender

Our research ndings strongly suggest that low road workplace practices prevalent in the Chicago’s restaurant in-dustry can increase public health risks. For instance, 75.9% o workers we spoke with in the course o our study reported working while sick. Several workers reported needing to work while sick because they could not aord totake the day o. One ront o the house worker explained, “Sometimes I sneeze or I cough into drinks. I I’m sick,I have to work. I am the only person working in the bar.” Ninety-six percent (96.2%) o workers surveyed reportedthat they did not receive paid sick days. During the outbreak o the H1N1 “Swine Flu” epidemic in early 2009, thepresident and surgeon general both urged people staying home to be the best way to minimize the spread o the fu.55

However, since nearly all ood service workers lack paid sick days and earn low wages, staying home is not easible

or them. Tus, a lack o paid sick days and preventative health care contribute to the risk o the widespread illnessamong both restaurant workers and the public they serve.

“Or you’re sick. I ’ve had some places say, well you still need to come in, but what I will say about a couple o those places is that they were really, they did care about us. So i they would ask you to come, but i you came, and you looked like crap, you know, they’d be like, okay. Go home. Which is kind o like,

you’re mad now, because you’ve done all this work. But at least they saw okay, you really are sick. And I think that’s what they need to do, weed out, because some restaurants have been so mean about it.” –Male, 5.5 years in the industry, Server



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“I call in when I’m sick. Over the years I am like hey i I am sick I take a day o. I drink lots o tea. I bundle mysel up so that I don’t get sick. I know i I do end up getting sick there is no way to nancial-ly take care o me.” – Female, 9 years in the industry, Bartender

Emploers wo orce restaurant worers to wor wile sic are contributin to a public ealt callene. Te U.S. Centers orDisease Control and Preention (CDC) in Atlanta estimates tat noroiruses, a amil o patoens associated wit outbreaso oodborne illnesses, are ac tuall more common in restaurants. In 2004, te most recent ear or wic data are aailable, 251reported outbreas o ood borne illnesses across te countr – inolin 10,000 ic tims – were tout to be iral. Accordinto CDC statistics, almost all were classifed as noroirus-related, and 93 were noroirus outbreas tied to restaurants.56

“I an employee stays home sick, it’s not only the best thing or that employee’s health, but also his co-workers and the productivity o the company.” – Commerce Secretary Gary Locke57

Timio, Prep Coo and Sit Superisor

I ae wored in te industr since I was 18, or oer 4 ears now. I started as a casier in a quic sererestaurant and am now a prep coo and sit superisor. In all o te ears tat I ae been in te industrm wae as alwas been alon te lines o minimum wae. I ae wanted a raise and tin tat I desereit because o m wor etic but ae seen a lot o aoritism. Raises are onl in existence, and treatmentis onl air in te industr i ou are close to manaement. In all te time tat I ae been in te industr Iae also neer ad ealt insurance and I ae neer ad paid sic das or acation das. Wen I do eelill I ae to decide ow sic I am and I ae to wonder, is it wort bein penalized or not comin in. I wecall in sic te sometimes reprimand us, te cane our sits, te da we tae o usuall becomesour permanent o da so we basicall ae to be prepared to rearrane our lies i we call in sic. Wen

I don’t come in to wor it is literall because te illness as otten so bad tat I am puin and runnin a i eer, oterwiseI ae to sow up. I eel lie we are let wit no coice because I want to et paid and I do not want to ae to cane m liebecause manaers want to punis me or bein sic. Tere is no wa or me to tell a mont in adance tat I am oin to besic, but tat is wat te expect and i we cannot predict our illness we suer te consequences

C. WORKPLACE PRACTICES AND CONSUMER RISK wenty-our (23.9%) percent o workers surveyed had done something as a result o time pressure that might haveput the health and saety o a customer at risk. Employers pursuing a low road business strategy place enormouspressure on workers, and oten cut corners on health and saety training, leading to workplace practices that endan-ger employee and ood saety, and consequently public health. As demonstrated by Figure 4, workers who reportedemployment law violations at their place o work were also much more likely to report workplace practices such asailure to provide health and saety training, being required to work when the restaurant is understaed or perormseveral jobs at once, and being asked to perorm a job or which they are not trained. In act, workers who experi-enced employment law violations were twice as likely as workers who experienced no employment law violations tobe orced to do something under time pressure that put the consumers’ saety at risk. Tis combination o workplace

conditions could have harmul eects on the health and saety o customers. Workers who reported that they haddone something as a result o time pressure that might have harmed the health and saety o the customer were morelikely to experience overtime violations (37%) and working “o the clock” without pay (39%) than the general survey population, 32.6% o which reported overtime violations, and 28.5% o which reported working “o the clock.”



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No labor violations

Any labor violations

Worker had to cut corners because

of time pressures that might have harmed

the health or safety of customers

Worker had to do a job for

which worker wasn't trained

Worker had to work when

restaurant was understaffed

Worker did not receive health

and safety training from employer

36.7%

28.8%

82.4%

80.1%

57%

46.8%

28.4%

20.5%

Percent of restaurant workers

FIGURE 4:Linkage Between Labor Law Violations andWorkplace Practices that Put Consumer Health at Risk


Paying workers wages below the ederal poverty line hurts not just workers and their amilies, but everyone – romemployers who pay higher unemployment insurance premiums to the taxpayer who pays more or, or receives ewer,social benets. When workers have trouble making ends meet, they have no choice but to utilize ood banks, hous-ing and child care subsidies, tax rebates or low-income people, and other social benets. As a result, more publicresources must be devoted to these programs – or, more likely in the current economic climate, there are ewer publicresources available to all o those in need.

Accordin to te autors o Wages, Health Benefts, and Workers’ Health, ier-wae worers are more liel tan teir lower-paid counterparts to ae ealt insurance and ealt-related benefts, suc as paid sic leae, and to use preentatie care.58

Low-wae worers, meanwile, are muc more liel to oreo needed ealt care because o cost and to report problemspain medical bills.

HEALTH CARE COSTS

“Insurance, benets I mean I know it is expensive and I know this industry hurts a lot and it takesmoney to make money in this industry but I mean I ’m ortunate enough that I had money saved up and

I can aord my own insurance at this time but when my money is gone, you know. Knock on wood I’mhealthy but God orbid something happens.” – Male, 4 years in the industry, Cook



Chapter VI

52

Our survey data indicates that the lowest paid workers in the restaurant industry are much less likely to have healthinsurance. Seventy-seven percent (77.3%) o those without health insurance were earning low and poverty-level

wages. As a result, low-wage workers are less likely to be able to access primary or preventative care or themselvesor their amilies. Data rom other studies suggests that low-wage workers are much more likely to orego neededhealth care because o the costs involved, and to report problems paying medical bills.59

Additionally, workplace injuries among restaurant workers are endemic. Data rom this and other studies suggeststhat restaurant workers oten access emergency room services or a range o work related injuries such as burns,scalds, and cuts.

When medical care is required, restaurant workers without health insurance are orced to seek treatment in emer-gency rooms at public hospitals, and are oten unable to pay or the medical services they need. Eighty percent(80.3%) o workers going to the emergency room did not have health insurance and were not able to pay or their

visit. When these realities are compounded by the act that low-wage workers are also less likely to receive paid sick days, it is clear why restaurant workers oten eel compelled to work while sick, increasing the risk o worseninghealth conditions and increased public health hazards.

Previous studies have noted that where health care nancing relies on employer sponsored health insurance, the

public suers as a result o “ree riders” - employers who opt out o the system by not providing aordable healthinsurance to their workers, and pass the costs o their workers’ health care onto the public.60 Ultimately, it is otheremployers, workers, and the public at large who pay or these low road practices espoused by employers.

SOCIAL PROGRAMS

Our survey data also revealed that low-wage restaurant workers are, at times, orced to access social programs such as welare benets and housing and chi ldcare subsidies in order to supplement low wages. wenty-our percent (23.7%)o all workers surveyed reported accessing social programs at some point to supplement their wages. Fity-sevenpercent (57.2%) o those who have accessed social assistance reported being recipients o Medicaid.

Ironically, o the respondents who reported receiving public assistance o some kind, 44.4% o these workers accessed

ood stamps through the ederal ly unded Supplemental Nutrition Assistance Program (SNAP). At the peak o therecession, the number o Americans receiving ood stamps reached 35 million in June 2009, the highest numbersince the program began in 1962, with an average monthly benet o $133.12 per person. 61

Numerous studies have suggested that employers paying low wages rely on social programs to sustain their workersrather than paying better wages.62 By creating conditions that orce workers to participate in social programs ratherthan providing essential benets, employers are, in eect, receiving an indirect public subsidy or engaging in poor,and sometimes illegal, workplace practices. Such practices also have the eect o undermining other employers whodo provide benets, thereby creating disincentives to those who might otherwise take the high road to protabil-ity.63 Existing literature concludes that this can lead to a downward cycle or wages and benets across the industry,ultimately resulting in worsening conditions or workers, consumers, and the public.64

Clearly, urther study is needed to determine the ull impact o the prevalence o low-wage jobs in the restaurant

industry on social programs in Chicago. What is clear rom existing data is that ailure to address low wages andthe lack o health coverage or thousands o workers in the industry leads to increased costs to workers, employerspursuing the high road, and, inevitably, the public.

Te kaiser Famil Foundation reports tat in ederal fscal ear 2008, a majorit o amilies usin Medicaid in Illinois (54.1%)included a ull time worer.65 It is clear tat ealt insurance in te priate maret is not an option or tese worers and teiramilies due to teir low incomes and te i cost o ealt insurance tat impacts bot emploers and te emploees. As aresult Medicaid flls te ap proidin essential access to ealt coerae or tese emploees and teir amilies.66



C h A P T E R vIIConclusions & Public PolicyRecommendations



Chapter VII

54

C h A P T E R vII

Conclusions & Public Policy Recommendations

B y weaving together industry and government data, existing academic literature on the restaurant industry, andthe voices o restaurant workers and employers, we are able to obtain a clearer and more comprehensive picture o the Chicago restaurant industry. Te restaurant industry holds enormous promise as a source o income and jobs tothe region. Its particular importance as a locally tied, sustainable industry providing employment to workers with-out ormal training, those seeking entry level positions, and immigrant workers whose experience is not recognizedby other employers, is clear.

However, our research conrms that, in practice, the majority o restaurant employers are unable or unwilling totake the high road to protable and sustainable businesses, creating an industry o predominantly “bad” – low-wage,long hour, dangerous and dead end jobs or most o the industry ’s workers. Additionally, the persistence o low roadpractices has the eect o compromising the health and saety o both workers and customers alike, orcing the city’staxpayers to subsidize restaurant employers through social programs.

Nevertheless, one o the major ndings o our research is that it is possible to run a successul restaurant business while paying workers living wages, aording standard workplace benets such as health care and paid sick and va-cation days, ensuring adequate levels o stang, providing necessary training, and creating career advancement op-portunities. While commitment to doing so on the part o employers is a necessary ingredient to achieve this goal,additional public policy measures are also needed to help restaurant employers ulll the potential o the industry to providing good, locally based jobs. Government and regulatory agencies should nd ways to support and rewardemployers who take the high road, in order to acilitate a truly successul Chicagoland restaurant industry.

Based on the results o our research, Te Chicagoland Restaurant Industry Coalition makes the ollowing specic recom-mendations:

1. Level the playing feld by providing paid sick days and increasing the tipped minimum wage. For thebenet o not only workers but also consumers and employers, policymakers should level the playing eld

by requiring all employers to provide paid sick days to their employers. Policymakers should also raise theminimum wage or tipped workers to be closer to the minimum wage or all other workers. As describedin our report, the lack o paid sick days among ood service workers can result in public health problemsor the entire region. Similarly, the tipped minimum wage o $2.65 is simply not enough or amilies tolive on, orcing many workers to rely on public assistance. Te lack o a level playing eld on both o theseissues ultimately hurts workers, consumers, and responsible employers.

2. Incentivize high road practices. Policymakers should consider initiatives and incentives that will assistand encourage employers to pay living wages and go above and beyond the law. Such initiatives couldinclude rent and property tax incentives or employers who implement exceptional workplace practices,thereby enabling them to reduce xed costs and invest more in workers. Tey could also take the orm o subsidies to employment-based health insurance or support o collective health insurance provision acrossthe industry. Given the high health care and public assistance costs associated with current practices,

limited public expenditures in these areas could result in substantial savings to the taxpayer overall. Weurge decision-makers to explore and implement such initiatives or the benet o all residents in theChicago region.

3. Promote opportunity, penalize discrimination. Policy options ensuring greater career mobility or workers o color should be explored, and racial discrimination in the industry addressed. Our researchillustrates the impacts o the occupational segregation within the restaurant industry. It is clear romour ndings that discrimination based on race and immigration status acts in concert with occupationalsegregation to keep immigrant workers o color rom higher-paying and more sustainable positions inthe restaurant industry. Policy makers should explore initiatives that encourage internal promotion anddiscourage discrimination on the basis o race and immigration status in the restaurant industry. Tesecould include subsidizing training programs that help workers o color advance to living-wage positions.



Chapter VII

55

4. Labor, employment and health and saety standards should be strictly enorced. Workers sueringrom egregious violations o labor and health and saety codes must be protected. Not only do ederal,state, and municipal agencies have a responsibility to ensure that these laws are respected; they also havea responsibility to individual workers whose lives are oten threatened by illegal workplace practices.

Tey also have a responsibility to protect the public rom the unsanitary conditions and public health

risks associated with illegal workplace practices, and to protect law-abiding employers rom unaircompetition rom those that do not comply. Local legislative bodies should consider policies thatprotect all stakeholders by considering a restaurant’s compliance with basic employment laws whengranting government licenses, such as liquor and other business licenses, that are intended by statuteor responsible business owners. Additionally, public resources need to be spent in order to enablegovernment agencies to eectively carry out this mission. Elected ocials should resources to theseagencies, and thoroughly oversee their activities.

5. Promote model employer practices. Model employers’ practices should be publicized. Te vast majority o employers we interviewed agreed in theory that high road workplace practices were better or boththeir workers and their businesses, decreasing turnover and improving customer service. However, they appeared unable to implement them in practice, citing external pressures and actors impacting theirbottom line. Dissemination o model business practices such as those cited in this report could go a long

way toward helping the vast majority o well-intentioned restaurant employers to not only do the rightthing, but also increase their protability, and thereore tax revenues rom the industry.

6. A llow workers the right to organize. Governments, employers, and non-governmental social sectororganizations should ensure that relevant initiatives oster and support organizing among restaurant

workers and publicize the public benets o unionization in this and other industries. Additionally,creative collective organizing eorts among restaurant workers which oster better wages and workingconditions, enable restaurant workers to access health care insurance and other benets, and acilitateadvancement, investment and ownership in the industry should be supported through research, unding,and policy initiatives. Finally, development and dissemination o “know your rights” training or restaurant

workers is clearly necessary.

7. Support urther industry research. Further study and dialogue is essential. While the results o ourresearch shed much needed light on the realities underlying existing statistical data, they also identiy

signicant gaps in inormation currently available. Tere is a particular call or more detailed inormationregarding occupational segregation and discrimination and eective remedies to occupational segregation.Additional potential areas or urther study identied by our research include: the actors infuencingemployers’ workplace practices and the needs that must be addressed in order to improve them, and theimpacts on health care and public assistance costs occasioned by industry practices. Data and policy initiatives in these areas should be explored with the ull participation o restaurant workers, employers,and decision-makers in order to ensure eective and sustainable solutions.

“how do we get America on te ‘ig road?’ Te answer, I believe, lies in partnersips – between unions and employers,between industr roups and communit roups, between worers and academic and political leaders, between oundationsand oernment aencies and scools and collees.” – Jon J. Sweene, ,ormer President AFL-CIO and President o te AFL-CIO Worin or America Institute’s Board o Directors67



Appendix and Endnotes

56

APPENDIX

Survey Demographics

Te survey was administered by sta, members, and volunteers rom the Restaurant Opportunities Center o Chi-cago (Chi-ROC) – a community based organization with signicant contacts among restaurant workers and accessto workplaces in the industry. A total o 582 surveys were conducted with workers, ace-to-ace in the vicinity o restaurants during breaks or at the end o shits, and inside restaurants.

TABLE 21: Characteristics o Chicagoland Restaurant Industry Coalition Survey Sample

Percent o Sample

Percent o Sample

Race Position

hispanic/Latino 34.5% Front o te house 40.8%

Wite 28.1% Bac o te house 30.2%

Blac 18.4% Mixed Front and Bac o te house 29.1%Mixed 7.9% Place o Birth

Asian 6.8% U.S. Born 63.1%

Middle Eastern 7.9% Forein Born 36.9%

Sex Restaurant Segment

Male 53.1% Fanc expensie table clot restaurant 27.3%

Female 46.9% Famil stle (cain/rancise and non-rancise) 26.7%

Age Fast ood or quic serice restaurant 46%

Under 25 43.7%

26 to 35 32.4%

36 to 45 10.6%

46 to 55 12.3%

Oer 55 .9% Sample Size (number) 582


NOTES ON SAMPLE:

Stratied random sampling methods were chosen to ensure that our sample was as representative as possible. Weused industry and Census data related to demographics with regard to race, gender, age, and county to select a samplethat is refective o the industry as a whole. Like all methods, our sampling methodology has strengths and limita-

tions, which may have aected the results. Even though stratied sampling was used to identiy subgroups withinthe target population, because workers were contacted on the streets and in communities in which restaurant work-ers reside, our sample was not strictly random. One o the greatest strengths o our outreach methodology, however,is the inclusion o populations typically underrepresented in the census. In addition, in-person surveys lead to highquestion-specic response rates. Using data rom the United States Bureau o Labor Statistics, we were able to weightthe sample to match the distribution o “back o the house” and “ront o the house” sta in “ull-service” establish-ments and “limited-services”eating places in Cook County’s restaurant industry.




57

ENDNOTES

Note: All URL’s last visited January 8, 2010.

1 See the National Restaurant Association’s Restaurant Perormance Index (July 2009). Available at: http://restaurant.org/pressroom/pressrelease.cm?ID=1838. Since 2004, employment o ood service workers, particularly “Food Counter Workers” has annually been projected to increase aster than the average or all occupationsover 10-year projection periods. See “Employment and Outlook” section at http://www.michigan.gov/careers/0,1607,7-170-46398-111478--,00.html#Employment.

2 See able 4. Data rom U.S. Bureau o the Census, Public Use Micro Sample rom US Census (2000) and AmericanCommunity Survey (2008).

3 See able 1. Data available rom U.S. Department o Labor, Bureau o Labor Statistics. Current Employment Statistics.Accessed 1 December 2009 or July 2009. Available at http://www.bls.gov/ces/.

4 Te City o Chicago. Chicago Ofce o ourism 2008 Statistical Inormation. Accessed 1 October 2009. Availableat http://www.explorechicago.org/etc/medialib/explore_chicago/tourism/pds_press_releases/chicago_oce_

o.Par.60218.File.dat/Statistics_2008.pd.5 U.S. Department o Labor, Bureau o Labor Statistics. Quarterly Census o Employment and Wages. Accessed 1December 2009. Available at http://www.bls.gov/cew.

6 U.S. Department o Commerce, Bureau o Economic Analysis, Regional Economic Accounts. Gross Domestic Product by Metropolitan Area. Accessed 15 December 2009. Available at http://www.bea.gov/regional/gdpmetro/action.cm.

7 In 2008, QCEW estimated 171,902 employed in ood services and drinking places. U.S. Department o Labor,Bureau o Labor Statistics. Quarterly Census o Employment and Wages. Accessed 1 December 2009. Available at http://

www.bls.gov/cew.

8 Te “Leisure and Hospitality” supersector includes 1) arts, entertainment, and recreation, 2) ood services anddrinking places, and 3) hotels and other accommodations. See able 1 or ood services and drinking places as a

subsector under “Leisure and Hospitality.” Data available rom: www.bls.gov/ces.9 See able 1.

10 U.S. Department o Labor, Bureau o Labor Statistics. Current Employment Statistics. Accessed 1 December 2009.Available at: www.bls.gov/ces. ime series analysis rom 1990 to 2008 in Figure 1 refects this inormation as well.

11 U.S. Department o Labor, Bureau o Labor Statistics. Current Employment Statistics. Accessed 1 December 2009.Available at: www.bls.gov/ces.

12 Jennier Ratttcli. “Illinois Manuacturing Jobs Down 2.1% Over Past Year.” January 16, 2009. Accessed 1December 2009. Available at http://www.manuacturersnews.com/news/release.asp?ID=157.

13 Tis report is ocused on the rst two o these sectors. Within these sectors, we have identied three general sub-segments o the restaurant industry which are presently untracked by government data and which were importantin guiding our study and understanding the varying practices and strategies used by individual businesses. Tey areurther outlined in Chapter III: Workers’ Perspectives.

14 U.S. Department o Labor, Bureau o Labor Statistics, Occupational Employment Statistics. Accessed 12 January 2010or Chicago-Naperville-Joliet, IL Metropolitan Division (2008). Available at http://www.bls.gov/oes.

15 In 2008, QCEW 171,902 employed in ood services and drinking places. See U.S. Department o Labor, Bureau o Labor Statistics. Quarterly Census o Employment and Wages. Accessed 1 December 2009. Available at http://www.bls.gov/cew.

16 Sharon L. Lohr, Sampling: Design and Analysis. Pacic Grove, CA: Duxbury Press, 1999.




58

17 Elazar J. Pedhazur and Liora P. Schmelkin, Measurement design and analysis: An integrated approach. New York:Psychology Press, 1991.

18 Ater the data were weighted, the percentage o the sample in each segment was as ollows: ne dining 27.3%, amily 26.7%, and quick service 46%. See Appendix or other characteristics o the survey sample.

19 Te survey sample included workers already employed in the industry, not trainees or workers rom other industries who wished to work in the industry. Furthermore, all workers surveyed were employed at the time the survey wasconducted.

20 Steinar Kvale. Interviews: An Introduction to Qualitative Research Interviewing . Detroit: Sage Publications, 1996.

21 “Campus Living Wage Resources: What’s a Living Wage?,” Living Wage Action Coalition. Accessed June 1, 2009.Available at: http://www.livingwageaction.org/resources_lw.htm.

22 U.S. Department o Labor, Employment Standards Administration Wage and Hour Division. Minimum Wage Lawsin the States, 2009. Available at http://www.dol.gov/whd/minwage/america.htm.

23 U.S. Department o Labor. Fair Labor Standards Act and Amendments. Available at: http://www.dol.gov/elaws.

24 Susan B. Coutin, Nation o Emigrants. Ithaca, NY: Cornell University Press, 2007, p. 179.

25 Nola Sarkisian-Miller, “Many new immigrants nd that the restaurant industry represents their best chance atemployment,” Los Angeles Business Journal , 20 December 1999.

26 ACCRA Cost o Living Index: Comparable Data or 303 Urban Areas, Te Council or Community andEconomic Research, February 2008. Accessed 1 November 2009. Available at http://www.gastongazette.com/attachments/1203624730-costofiving.pd.

27 Chicago metro area reers to the Chicago-Naperville-Joliet, IL Metropolitan Division.

28 Out o Reach 2009, National Low Income Housing Coalition. Accessed October 20, 2009. Available at: http://www.nlihc.org/oor/oor2009/.

29

Michael Lynn, “urnover’s Relationship with Sales, ips and Service Across Restaurants in a Chain.” International Journal o Hospitality Management 21: 443-447; Julia Lane, “Te Low-Wage Labor Market: Challenges andOpportunities or Economic Sel-Suciency – Te Role o Job urnover in the Low-Wage Labor Market.” Accessed10 December 2009. Available at: http://aspe.hhs.gov/HSP/lwlm99/lane.htm.

30 Internal Revenue Service. ips on ips: A Guide on to ip Income Reporting . Accessed 12 January 2010. Available at www.irs.gov/pub/irs-pd/p3148.pd.

31 In addition to increasing the state minimum wage, Public Act 94-105 gives the Illinois Depart o Labor strongerauthor to enorce the minimum wage, overtime and wage payment laws. See http://www.ilga.gov/legislation/publicacts/ulltext.asp?Name=094-1072&GA=094 or more inormation.

32 U.S. Department o Labor. Fair Labor Standards Act and Amendments. Available at: http://www.dol.gov/elaws.

33

Ibid . See also Rajesh D. Nayek and Paul K. Sonn, “Restoring the Minimum Wage or America’s ipped Workers,”National Employment Law Project, August 2009. Available at http://www.nelp.org.

34 See OSHA regulations regarding enorcement o health and saety standards. Available at: http://www.osha.gov/pls/publications/publication.html.

35 State o Illinois. Illinois Workers’ Compensation Act . Accessed 1 December 2009. Available at www.state.il.us/Agency/IIC/act.pd.

36 U.S. Department o Labor, Bureau o Labor Statistics. Quarterly Census o Employment and Wages. Accessed 1December 2009. Available at http://www.bls.gov/cew.

37 U.S. Department o Labor, Bureau o Labor Statistics. Current Employment Statistics. Accessed 1 December 2009.




59

Available at: www.bls.gov/ces.

38 Annika Stensson and Maureen Ryan, “Restaurant Industry Outlook Improved Somewhat in July as RestaurantPerormance Index Posted First Gain in Tree Months,” 31 August 2009. Accessed 1 September 2009. Available athttp://www.restaurant.org/pressroom/pressrelease.cm?ID=1838.

39 U.S. Department o Labor, Bureau o Labor Statistics. Current Employment Statistics. Accessed 1 December 2009.Available at http://www.bls.gov/ces/.

40 Jonathan A. Parker, “Te Consumption Risk o the Stock Market.” Brookings Papers on Economic Activity, 2001,279-348.

41 “Alcohol Sales Climb During Recession,” Join ogether From Te National Center on Addiction and SubstanceAbuse at Columbia University. Accessed 10 December 2009. Available at: http://www.jointogether.org/news/headlines/inthenews/2002/alcohol-sales-climb-during.html.

42 Annika Stensoon and Sue Hensley, “Consumer Demand or Ways to Fit Quality Meals into Hectic Schedules, ShapeRestaurant rends in 2008, According to National Restaurant Association,” National Restaurant Association, 12December 2007. Available at http://www.restaurant.org/pressroom/pressrelease.cm?ID=1537.

43 Lauren R. Harrison, “It gets easier being green or Chicago diners,” Chicago Breaking News Center , 26 August 2009.Accessed 1 December 2009. Available at http://www.chicagobreakingnews.com/2009/08/it-gets-easier-being-green-or-chicago-diners.html.

44 Holly Hill, “Food Miles: Background and Marketing,” National Sustainable Agriculture Inormation Service , 2008.Available at attra.ncat.org/attra-pub/PDF/oodmiles.pd. See also Danielle Murray, “Oil and Food: A RisingSecurity Challenge,” Earth Policy Institute, 2005. Available at www.earthpolicy.org/.

45 J. Bruce racey and imothy R. Hinkin, “Te costs o employee turnover: when the devil is in the details,” Te Center or Hospitality Research, 2006, Report 6, No. 15.

46 Fred Minnick, “Litigation woes dey reorm: lawsuits that snare businesses in costly, distracting battles continue toemerge despite the industry’s eorts to clear up legal quagmires,” Nations Restaurant News, 8 January 2008.

47 High Road Partnerships Report , AFL-CIO Working or America Institute. Accessed 10 January 2009. Available at:http://www.workingoramerica.org/documents/HighRoadReport/highroadreport.hym.

48 Rachel King, “urnover is the New Enemy at One o America’s Oldest Restaurant Chains,” Workoce ManagementOnline, April 2004. Available at http://www.workorce.com/section/06/eature/23/68/40/. See also imothy Hinkinand J. Bruce racey, “Te cost o turnover: Putting a price on the learning curve,” Cornell Hotel and

49 J. Bruce racey and imothy R. Hinkin, “Te costs o employee turnover: when the devil is in the details,” TeCenter or Hospitality Research, 2006, Report 6, No. 15.

50 Te Great Service Divide, Occupational Segregation & Inequality in the New York City Restaurant Industry , RestaurantOpportunity Center o New York, 2009.

51 U.S. Congress, itle VII o the Civil Rights Act o 1964 . Accessed 12 January 2010. Available at http://www.eeoc.gov/

laws/statutes/titlevii.cm.52 Sexual harassment is a orm o sex discrimination that violates itle VII o the Civil Rights Act o 1964. For more

inormation, see the U.S. Equal Employment Opportunity Commission, Laws, Regulations and Guidance . Availableat http://www.eeoc.gov/laws/types/sexual_harassment.cm.

53 NLRB claried that a worker’s immigration status is only relevant ater the employer is ound liable. See Issue Brie:Workplace Rights o Undocumented Workers Ater the Supreme Court’s Homan Plastic Ruling , National Immigration Law Center. Accessed 18 December 2009. Available at http://www.nilc.org/immsemplymnt/IWR_Material/Attorney/Issue_Brie_Workplace_Rights_post_Homan_3-06.pd.

54 Hidden Costs: Te Public Cost o Low-Wage Jobs in San Diego. San Diego: Center on Policy Initiatives, March 2004.




60

55 Robert Gibbs, Secretary Janet Napolitano, John Brennan and Dr. Richard Besser, “Press Brieng on SwineInfuenza,” Te White House Oce o the Press Secretary, 26 April 2009. “HHS Secretary Kathleen Sebelius,Sesame Workshop, and the Ad Council Launch National Campaign to Protect Families rom the H1N1 Virusand Stay Healthy,” U.S. Department o Health & Human Services, 22 May 2009. Accessed 10 December 2009.Available at http://www.hhs.gov/news/press/2009pres/05/20090522a.html.

56 Centers or Disease Control and Prevention, Norovirus: echnical Fact Sheet, National Center or Immunizationand Respiratory Diseases, Division o Viral Diseases. Accessed 18 December 2009. Available at: http://www.cdc.gov/ncidod/dvrd/revb/gastro/norovirus-actsheet.htm. Norovirus Treat Spurs New Focus on Sanitation, Sick-Leave Policies, Germ Central. Accessed 18 December 2009. Available at: http://www.germcentral.com/industries-supermarkets-norovirus.html.

57 Gary Locke, Secretary Kathleen Sebelius, and Secretary Janet Napolitano, “Federal Guidelines Encourage Employersto Plan Now or Upcoming Infuenza Season,” Department o Commerce, Oce o Public Aairs, 19 August 2009.

58 Sara R. Collins, Karen Davis, Michelle M. Doty, and Alice Ho. Wages, Health Benets, and Workers’ Health. New York: Te Commonwealth Fund, October 2004.

59 Ibid.

60 C. Jerey Waddoups, Employer Sponsored Health Insurance and Uncompensated Care: An Updated Study o the University Medical Center in Clark County, Center or Community and Labor Research, July 2001.

61 Roberta Rampton and Chuck Abbott, “Food stamp list soars past 35 million:USDA,” Reuters, 3 September 2009.Available at http://www.reuters.com/article/domesticNews/idUSRE5825O20090903.

62 Annette Bernhardt, Ruth Milkman, Nik Teodore, Douglas Heckathorn, Mirabai Auer, James DeFilippis, AnaLuz González, Victor Narro, Jason Perelshteyn, Diana Polson, Michael Spiller, National Employment Law Project,UCLA Institute or Research on Labor and Employment, and UIC Center or Urban Economic Development.Broken Laws, Unprotected Workers: Violations o Employment and Labor Laws in America’s Cities, 2009. Accessed 12

January 2009. Available at nelp.3cdn.net/1797b93dd1ccd9e7d_sdm6bc50n.pd.

63 Ibid. Te impact o such practices on other industries has been well-documented. See Arindajit Dube and Ken Jacobs,Hidden Cost o Wal-Mart Jobs, Use o Saety Net Programs by Wal-Mart Workers in Caliornia, Brieng Paper Series,

Berkeley, CA: Center or Labor Research and Education, University o Caliornia, 2 August 2004; Hidden Costs: Te Public Cost o Low-Wage Jobs in San Diego, Center on Policy Initiatives; Carol Zabin, Arindrajit Dube, Ph.D., Ken

Jacobs, Te Hidden Public Cost o Low-Wage Jobs in Caliornia. See also Annette Bernhardt and Heather Boushey,Conronting the Gloves O Economy: America’s Broken Labor Standards and How to Fix them, July 2009. Available athttp://nelp.3cdn.net/016d12cb9c05e6aa4_bvm6i2w2o.pd.

64 Ibid.

65 State Health Facts: Illinois at a Glance. Available at http://www.statehealthacts.org/proleind. jsp?ind=155&cat=3&rgn=15.

66 Ibid .

67 High Road Partnerships Report , AFL-CIO Working or America Institute.



Chicagoland Restaurant Industry Coalition partners include:

Arise ChicagoBurgess Law OfcesChicago Workers’ CollaborativeUIC-Center or Urban Economic Development (CUED)Grassroots CollaborativeDiana M. Lin, Northwestern UniversitySargent Shriver National Center on Poverty LawTed Smukler, DePaul UniversityUE Western RegionUniversity o Chicago Human Rights ProgramWomen EmployedWorking Hands Legal Clinic

The Coalition would like to thank the many students, interns, restaurant owners, and restaurant workers whodevoted many hours to conducting surveys, interviews, and generally assisting with this project. In particular,we would like to thank the ollowing Brooklyn College students or their assistance in inputting and analyzingsurvey data: Laura Khan, Alex Barnett, Piotr Pac, Juan Toro, Jerey Ribako, and Stephanie Scott.

The Restaurant Opportunities Center o Chicago77 Washington Street, Suite 1400Chicago, IL 60602Phone 312-629-2892


behind the kitchen door: pervasive the hidden costs of taking the low road in chicagoland’s...

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