Mayor Brandon Johnson vetoed on March 25 a City Council-approved measure that would have frozen scheduled increases to the subminimum wage for tipped workers in Chicago. The decision came after the council voted 30-18 in favor of keeping the city’s tipped minimum wage at $12.62 per hour, with tips paid on top, rather than allowing planned raises.
The issue has been central to debates over worker pay and restaurant industry challenges in Chicago. While supporters of freezing the wage say it is necessary for business stability, opponents argue it would harm workers who rely on incremental raises.
At a press conference where he signed the formal veto, Johnson said, “Families are struggling under the weight of rising costs, rent, groceries, child care — and wages have not kept up with these rising costs.” He continued: “At a time when people are fighting just to stay afloat, you had individuals who claim to stand up for working people as Democrats take money out of the pockets of working people. This is the opposite of what we need in leadership in this moment.”
The Illinois Restaurant Association immediately criticized Johnson’s move. Sam Toia, president of the association, said: “Today’s veto is completely misguided. It will eliminate jobs, reduce take-home pay for restaurant workers, and cause irreparable damage to the vibrant restaurant industry in each of Chicago’s 77 communities. We need to freeze the tip credit and give our restaurants and their employees a fighting chance.” Jessica Perjes, owner of Tacotlan in Hermosa neighborhood also voiced concerns about increased labor costs leading her to consider automation and reduced staff hours: “With rising labor costs I’m considering switching to QR-code ordering just to afford operating. That means fewer service jobs and less hospitality. Eliminating the tip credit like this won’t increase our servers’ earnings — it will reduce opportunities,” she said.
Alderman Gilbert Villegas (36th), who supported pausing wage hikes last week based on survey data from about 200 full-service restaurants indicating widespread menu price increases and staffing cuts since previous minimum wage changes took effect, urged compromise between city officials and businesses moving forward.
Meanwhile Alderman Jessie Fuentes (26th), an original sponsor of One Fair Wage which phases out subminimum wages by 2028 so all workers earn at least Chicago’s standard minimum wage ($16.60/hour), argued that affordability should not come “at the cost” of workforce stability: “We can talk about affordability, and it should not come at the cost of our workforce…who make sure that we are…the epicenter of culinary [industry] in this country,” Fuentes said.
Unless City Council overrides Johnson’s veto with four additional votes beyond last week’s tally—a total needed being thirty-four—the next scheduled raise for tipped workers will go into effect this July.
