Waiting for the Minimum: US State Wage Laws, Firm Strategy, and Chain-Restaurant Job Quality

Abstract

The US approach to employment regulation has created conditions in which ‘high road’ employee management practices can be costly for employers, while limited regulation gives firms ample freedom to pursue ‘low road’ strategies. Within this context, US firms face increasing domestic and global pressures to cut labor costs of all types, particularly businesses operating in the retail service industry with many low-skilled, hourly jobs. Yet as recent organization- and job-level studies document, not all such jobs are created equal. This article considers potentially different business strategies applied to the same job, that of restaurant waiter, within the distinct public policy contexts of two US states. The authors analyze practices related to waitstaff wages, benefits, and staffing and scheduling reported by managers at 16 sites of two national restaurant chains positioned in different lower-end segments of the full-service restaurant industry; and in suburban Seattle and Chicago, reflecting divergent state minimum-wage policy approaches. Findings reveal variation in employer practices across sites, often patterned by chain and state.