One winner in all this - NYC government! Now they can charge sales tax on the “tips”.
As has been mentioned often when the subject of tipping comes up, there can be many issues with a meal that have nothing to do with whether waitstaff provided good service, such as really long waits for a reserved table, food that comes out mediocre or improperly prepared, etc.
Bruce
Same here. I appreciate in Japan, Australia, and New Zealand and I had really good service in all of those places with no tipping. Their employees make a living wage which is more than I can say for the US service business.
Great point - in a city like Chicago that means “leakage” caused by the change in approach that neither benefits the customer nor the staff of almost 10% on the 20% or essentially increasing the costs of dining out by 2% without anyone benefiting - but since I suspect a lot of people calculate the tip after tax (though properly proper to back it out, most don’t) maybe it doesn’t matter to the customer - however, the leakage properly hurts the staff because their tip is lower.
As prices go up probably by more than 20% to increase back of the house staff, the taxable nature of it will hit the customer even more and the leakage to tax will be even greater. I wonder if they can still characterize it as gratuity but still bake it into the menu pricing - such as saying that the pricing on the menu includes a 20% gratuity (not sure they could say more than that but at least the leakage wouldn’t be on the entire 20-25% increase).
Sorry, bad word choice. I think you get my drift, however.
If the goal were truly to pay the kitchen staff more money, couldn’t you just pay the kitchen staff a higher wage than you currently are? Does it really have anything to do with whether you bake tips into the menu prices or not? Is there any guarantee that raising prices and eliminating tips means that kitchen staff get paid any more than they were before? I’m not sure the connection between one thing and the other.
I am with you. I think it sucks. As a former waiter I liked to earn my money. Working for tips makes you better every day. As a consumer, again, I like to reward greatness, including, occasionally extra for other staff members. I also like the idea of better service for good consistent tipping- not overtipping.
But does that have anything to do with tipping versus not tipping? If, say, Outback Steakhouse raises prices 20% and says no tipping is allowed, is there any reason to think the wait staff and kitchen staff will end up making any more money than they do now? In fact, with that making the de facto tipping portion subject to sales tax, as well as eliminating the portion of cash tips that goes unreported (as presumably happens to some degree in restaurants and bars these days), might they end up with less money?
Those two things (eliminating tipping, and bar and restaurant employees getting paid a higher wage) are often conflated in these discussions, but I would like to hear someone explain why that is so. Thanks in advance for any explanation.
In Japan, Australia, and New Zealand it does mean the rest of the staff, including kitchen and dishwasher, cleanup staff al make more. Since it has been there for a long time, who would know if this makes less money for the waitstaff. If the goal of tipping is somehow to reward or punish for service, that would be eliminated in those countries but the service is still very good. I don’t think eliminating tipping would cause them to make less money. The customer would have to pay more because now the amount that would go to tipping would also include more sales tax. Seems that we are talking about different things. I worked as a waiter, busboy, prep cook, line cook, and maitre de in several restaurants and we had to have tipping because the restaurant paid next to nothing. The restaurant basically got away with nearly free servers. And even in restaurants with excellent service, you felt like you were at the mercy of “kindness of strangers”. Some customers who got excellent service still left little to no tip. And the restaurant policies that pool tips and split them reward service bad or good. How does that reward good service by and individual?
Here is my question. Let’s say pay for your meal at a “no tipping” restaurant with a credit card. When you sign the credit card chit (I’m not sure what it’s really called.), is the “Total Amount” already filled in, or is there a line to add a “Gratuity?”
My guess is that even if no tipping does spread, some, if not many, restaurants will still have that “Gratuity” line on the chits. My second guess is that many people will then fill in an additional amount.
We have the answer.
There will, of course, always be a line to add for ‘gratuity’ if you’d like. That’s the way I’ve always seen it here in the US when restaurants have adopted this policy. Perhaps you do not see it overseas - tis the custom and culture.
Great questions raised above. We are assuming that the back of the house staff will be better compensated - to you think the company will ‘show’ that this is happening? No, I think their intentions are good - just not sure the follow up will happen from top to bottom.
And yes, the market will tell us whether this is a good move or not. IF they raise prices over 20%, which is what will most likely happen, will regular customers notice?
The most important aspect in this equation to me is the wait staff - they are front and center in terms of how you ‘view’ a restaurant in addition to quality and presentation of food. If they feel ‘slighted’ by this, this may show in the service they offer - or lack thereof. Just curious . . .
Cheers.
Yes, you are right — all the prices (including wine) are simply 20% higher. I didn’t mean to imply there was a forced 20% tip, but that the idea of gratuity is still in place, including a tip line on the bill.
That’s fantastic.
Not many, I imagine. It would feel very weird to me.
Everybody else seems to be down on John’s questions. But I’m with him. I’ve worked in restaurants before. I think waiters work for tips. I think the fear of a bad tip is also motivating (the post-dinner signalling is less important). And I often received particularly good tips after I worked hard to fix problems with food, ambience, and/or service.
While I’m sympathetic to the “man up and say something” school of thought, I’ve heard enough horror stories and personally witnessed some pretty obnoxious results to think twice about voicing all but the most gentle complaints in most restaurants. If you think spitting in the soup is as bad as it gets, you don’t have the imagination possessed by many restaurant employees. I’d be even more worried if tips were removed from the equation.
30-35% increase to cover the tipping. Seems high.
http://www.msn.com/en-us/foodanddrink/restaurantsandnews/danny-meyer-will-topple-tipping-once-and-for-all/ar-AAfrEFs?li=AAa0dzB
The cost of each dish will go up 30 to 35 percent (to account for what Meyer calls a “labor of wrong”)
In the 1987, I earned about $300 a day, after tax, in tips waiting tables lunch and dinner in midtown Manhattan. Pre-tax, that’s about $40 an hour. My guess is good waiters in New York make more than that today. No way Danny Meyer will pay his wait staff that much. So the good wait staff at his restaurants will leave for other jobs.
I do like the idea of kitchen staff getting paid more. That discrepancy has always been way too big. Of course, you have to trust the restaurant owner to pass the money along.
As a diner, I’m indifferent. The European system seems to work fine.
Not necessarily - waiters are usually subject to a lower minimum wage, with a presumption that tips make up the difference. So not sure how this helps that, unless the disparity is somehow reduced now.
And here is the flipside: San Francisco Restaurants and Food News - SFGATE
Note, however, that CA may be a little different because I believe (correct me if I’m wrong) that CA law requires restaurants to pay servers minimum wage before tips, whereas that’s not the case in many or most other states.
For those of you in Seattle, Lion Head, which is Jerry Traunfeld’s (of Poppy, earlier Herb Farm) new Sichuan restaurant also has eliminated tipping. On the credit card slip there is no line to add a tip. I dont know what happens if you want to leave cash. The items are of course a bit more expensive than normal. I dont know the behind the scenes economics (i.e. how much is added into the food given there is no tipping, nor how much more the service staff gets).