Medici House owner explains why minimum wage forced him to shut down

EAST AURORA (N.Y.)- A restaurant in East Aurora closed its doors after the owner said he couldn’t afford to pay a higher minimum wage. Medici House and the adjoining restaurant, Theas, were shut down on Saturday.

“It’s a little bit of a shock,” said Mark Stancampiano, a former dishwasher. “My problem is I have three kids, two handicapped kids, so it’s tough all the way around.”

Stancampiano is one of about 20 employees laid off after the restaurants closed.

“Going to have to take a hard look at everything now, have to cut back,” said Stancampiano. “It’s a sad day all the way around no doubt about it. I really feel for the people that do not have a second job to fall back on, this was really helping to pay the bills for my family.”

Owner John Rooney told News 4 a wage hike for tipped workers added $100,000 in costs to his budget so he had to make cuts.

“This is the biggest punch that we’ve ever had to deal with,” said Rooney.

As of Jan. 1, 2016, all tipped workers in New York State have to make $7.50 per hour, plus tips. It’s an increase for Rooney who was paying his employees the industry standard of $5.00 per hour, plus tips.

The State also put a $9.00 minimum wage in place for all workers but Rooney told News 4 his other employees already make more than that.

Rooney said he tried cutting shifts and using cheaper food suppliers but he couldn’t change the bottom line. He told News 4 if he had raised the prices on the menu, he would’ve lost business.

“No one would’ve understood if you said to someone in July, my sandwich is seven dollars now because in the winter we’re going to be forced to increase our wages,” explained Rooney.

After 14 years in business he decided to close Medici House and Theas.

“We could’ve carried on for months after this but debt would’ve piled up and we would’ve lost everything, literally everything,” said Rooney.

A Wage Board approved the hike a year ago at the recommendation of Governor Andrew Cuomo.

“I believe a rising tide raises all boats and if business is doing well, God bless business, but labor has to go up along with business,” said Governor Cuomo.

Governor Cuomo’s office said the hike was necessary because tipped workers in New York State are twice as likely as other employees to experience poverty and experience triple the poverty rates of other workers.

Business owners like Rooney think the wage hike is doing more harm than good.

“The raw reality is it’s going to put people out of business,” said Rooney.

He will continue to run his third restaurant, Yelling Goat, in Lancaster.

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