PHOENIX β€” The Arizona Restaurant Association’s bid to convince voters to let them pay their workers less is so misleading, it should not be allowed on the ballot, according to an attorney for foes.

James Barton is telling the Arizona Supreme Court it should block Proposition 138 from going to voters. The key, he said, is it’s being sold as the β€œTipped Workers Protection Act,’’ the title proposed by restaurant owners and incorporated by the state lawmakers who agreed to put it on the ballot for them.

Only thing is, said Barton, if it’s approved, restaurants could pay their tipped workers less than they do now.

β€œThe court has the power to intercede on the people’s behalf when a fraud on the electorate is being perpetrated,’’ Barton said in new legal filings.

He made the same arguments before, only to be rebuffed by Maricopa County Superior Court Judge Peter Thompson, who ruled there is nothing inherently misleading about the measure. The judge said it could be construed as protecting tipped workers, because providing financial relief to restaurants could allow them to keep more of them on the job.

But Barton urged the justices to focus not on some economic theory but instead on what the measure actually would do.

Under current law, the minimum wage for workers is $14.35 an hour, a figure that increases annually to account for inflation. But employers are permitted to pay their tipped workers as little as $11.35 β€” $3 an hour less β€” as long as their total pay, with tips, hits the minimum.

Prop. 138 would increase the tips credit to 25% of the minimum wage. So, at the current $14.35 an hour, it would reduce the cost to the restaurant to $10.76.

Steve Chucri, president of the Arizona Restaurant Association, said no one will take home less than they do now. He pointed out that the 25% allowance for owners would be available only if a worker brings in tips equal to at least $5.59 an hour, bringing them up to $2 an hour above the minimum, or $16.35.

But what that also means, Barton said, is if the worker brings in less than the $5.59 in tips, they will get the current $11.35 β€” leaving the worker no better off than now.

Barton said he is not arguing that the title of Tipped Workers Protection Act implies there is some sort of promise to increase the minimum wage.

β€œBut it implies or promises that it will provide protection to tipped workers,’’ he said, something he said it does not do.

The challenge by Barton is being brought by Raise the Wage AZ. That is the group that collected signatures asking voters to raise the minimum wage by $1 an hour this coming January and another $1 in January 2026.

It also would have phased out the $3-an-hour tip credit.

The Arizona Restaurant Association sued. And proponents of what would have been Proposition 212 conceded they probably did not have enough valid signatures. That ended that fight.

But the restaurants went on the offensive, convincing their GOP allies in the Legislature to put Prop. 138 on the ballot, the one with the 25% tip credit. That led to Raise the Wage filing its own lawsuit over what Barton says is its misleading title.

Barton lost the first round earlier this month when Thompson threw out the case, at least partly based on what, in fact, is the β€œtitle.”

The judge said the official title actually is β€œAmending Article XVIII by adding Section 11, Constitution of Arizona.’’

The Legislature also added an official descriptive title: Permits employer to pay up to 25% less than the minimum hourly wage for employees whose compensation includes tips or gratuities from patrons, but only if the employer can establish that the employee ultimately received the minimum wage plus $2 for every hour worked.

Barton countered that lawmakers, at the behest of the Restaurant Association, added wording to the measure, saying β€œThis act may be cited as the β€˜Tipped Workers Protection Act.’ β€˜β€™ He said that while lawmakers have the right to create unofficial titles, β€œit cannot be done in a deceptive manner.’’

That still leaves the economic argument by restaurants that Barton and Raise the Wage AZ will have to face.

The Arizona Restaurant Association, in seeking to keep Prop. 138 on the ballot, argued there is a way of reading it to support their contention that decreasing what they have to pay tipped workers actually would be good for those workers β€” that lower labor costs would create what the industry called an β€œeconomically sustainable minimum wage requirement for employers.’’ It says that will β€œprevent elimination of tipped workers’ jobs because of additional, statutory-imposed business costs.’’

Thompson said that was enough of an argument to allow the issue to go to voters.

β€œThe political views of whether the goal of tipped worker protection is best accomplished by adopting or rejecting the proposed amendment should not be conflated with rejection of the proposed amendment before it even appears on the ballot,’’ the judge wrote.

The Supreme Court is likely to decide this coming week whether the measure remains on the ballot.

Restaurant servers and other workers depend a lot on tips. With the way things are right now, many people are tightening their purses, especially those from younger generations. PennyGem’s Johana Restrepo has more.


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Howard Fischer is a veteran journalist who has been reporting since 1970 and covering state politics and the Legislature since 1982. Follow him on X, formerly known as Twitter, and Threads at @azcapmedia or email azcapmedia@gmail.com.