Some Restaurants Backpedal On That Whole "no-Tipping" Plan
When celebrated New York restaurateur Danny Meyer announced in 2015 that his hospitality group would end tipping at its restaurants, the news sent waves through the restaurant world from coast to coast. Many heralded the "hospitality included" move as progressive and necessary; Bizarre Foods host Andrew Zimmern called it "a jobs issue" and "a social justice issue." Some thought a tickets-based system—operating on the same idea as buying tickets to see a concert—would help both no-show diners and even out the pay disparity between cooks and service staff. But many more in the industry expressed skepticism that this model represented a viable, long-term policy for the industry. Three years later, there's evidence those critics may have been right.
The Wall Street Journal reports on a number of NYC restaurants that had instituted no-tipping policies (instead choosing to raise menu prices)... and then reversed course back to tipping. The pressure came partially from customers who were turned off by higher prices; staff at a restaurant called Agern say they've seen an increase in walk-ins (and take-home pay) since Agern returned to tipping and lowered its menu prices. But the pressure has also come from restaurant staff; Eater reported earlier this year that Danny Meyer's restaurants lost 30 to 40 percent of veteran servers, bartenders, and hosts when they eliminated tipping.
It's not just NYC restaurants rethinking their approach. Joe's Crab Shack first tested a no-tipping policy at 18 restaurants, then walked that back to four when the pilot location lost around 8-10 percent of customers. At least four San Francisco restaurants also quickly reinstated tipping, "citing a loss of quality servers." Ditto for restaurants from Portland, Maine to Portland, Oregon.
The pressure is two-fold: customers and restaurant staff both need to be on board with the no-tipping model. Less than half of diners surveyed by Zagat this year support raising menu prices to include gratuity (22 percent say they "hate it"). Staff too can feel that a no-tipping policy robs them of extra money they could be taking home on busy nights or when big-spending regulars come in for dinner: "[Tipping is] more motivational," one NYC restaurant owner told the WSJ. "When they had no tipping, the staff... complained about not being rewarded during busy times."