(KARE) The small Oasis Caf? near downtown Stillwater, Minnesota has found itself in the center of a large media storm after passing on a 35-cent fee to every customer's meal tab, a move to offset Minnesota's recent minimum wage hike.
Owner Craig Beemer enacted the fee after Minnesota's new minimum wage law went into effect August 1st.
"He is going to lose over $10,000 a year paying servers higher wages and that goes for every small business. Businesses trying to make it are really struggling," said Dan Herbert, an Oasis Caf? cook and server who has worked at the restaurant more than a decade.
The 75-cent minimum wage hike was first the state has seen in a decade. Herbert said while angry critics have bombarded the restaurant's Facebook page and triggered national media, the measure has also brought in more business. Customers like Solviga Kisselburg came in Thursday for lunch to specifically to support the business.
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"It's transparent and some people don't like the transparency. Where is the money going to come from? It was forced on them. It's Economics 101 unless you get an influx of business," said Kisselburg.
Customer Cory Cichocki said he is a sous chef at another Stillwater restaurant that is making changes too.
"We are charging for chips and salsa when we used to give it for free, and we are getting down on our food costs and labor costs. That's how we cope with it," said Cichocki.
Governor Mark Dayton told MPR News that restaurants have the right to pass on such a minimum wage fee but he calls the decision tacky and disappointing.
"There aren't any laws against the 35-cent charge," contested Herbert.
Herbert added what critics don't realize is while the restaurant's servers made minimum wage, their tips put them past $20 an hour. He said Beemer has long paid the majority of Oasis Cafe employees far higher than minimum wage, treating them as family.
"Even our dishwashers are making $10 or more an hour. Some of us are making more than twice minimum wage and you don't see that in a small business," said Herbert.
The Minnesota Restaurant Association surveyed its members in 2013 when the legislature considered passing the hike. More than 90 percent of members surveyed said they would increase menu prices, and more than 76 percent responding said they would reduce employee hours.
The Minnesota Restaurant Association lost its proposal to a system to give non-tipped employees a higher wage, while tipped employees who earned at least $12 an hour with tips remained at $7.25 an hour.
Oasis Café is the only Minnesota restaurant to add a minimum wage fee so far to offset paying servers $8 an hour instead of the federal rate of $7.25 an hour.