Doing Away with the Tip

Here's a piece of news from Money that is a bit old but that I wanted to get your input on. The details:

Now, one New York eatery is...[taking] the discretionary tip out of the hands of the diner.

Effective September first, Per Se, one of the most highly rated Manhattan restaurants, is instituting a 20 percent service charge to all checks in lieu of a tip. The service charge will then be used by the restaurant to help pay all hourly employees -- kitchen staff, waiters, and busboys -- a flat hourly wage.

Certainly, it will mean less control for those doing the eating, at least if you're the sort who uses the tip to reward or punish waiters for their service.

A poll by the entertainment guide Zagat Survey backed up Cury's claim. It showed that 70 percent of restaurant patrons surveyed in 2004 would rather determine the tip themselves than have the gratuity included in the bill.

Wow! Who knew there were so many issues associated with tipping? The key fact that stands out to me (as a consumer) is "70 percent of restaurant patrons surveyed in 2004 would rather determine the tip themselves than have the gratuity included in the bill." They're moving in the exact opposite direction. It doesn't seem like it's a good business move to me.

What do you think?

Comments

[Donald Chen]

I agree with you. Restaurant owner should absort the cost for his staff. Tips are customers' appreciation for good services.

[tdfb]

I agree completely with the 70%. I tip according to two factors, the quality of the food and the quality of the service. I go as high as 20% (perhaps a little more if I'm rounding) and conversely as low as a big fat goose-egg!

I have enountered a few restaurants that automatically incorporate the tip into the bill. I never go back.

To make it completely fair (which we know will never happen), the restaurants should adjust the pay rates of each group. Servers down, cooks up and whomever else they need to adjust. Then the tips should be evenly split among ALL employees. That way they win or lose as a team, not individuals.

[Michael Blackburn]

A) "As high as 20%" ? You are indeed a fountain of generosity. 20% on the pre-tax price is actually the *correct* tip for professional service. In most places, the waiter makes no money besides what's left on the table. You should always tip, regardless of service. You're actually exacerbating the problem if you goose-egg (you're confirming the waiter's suspicion that he doesn't make any money, so why try). If there's a problem with the service, you should talk to the manager. If there's an extreme problem with the service, you should let him know you will not return to the restaurant. I guarantee that will have a much larger impact on a bad waiter's income than missing out on your $1.85 change-from-a-twenty tip.

B) In most restaurants, it is customary for the waitstaff to share tips with the busboys and kitchen staff. Some locations enforce it, taking a portion of the waiter's tips for this purpose. I was always aware of the discrepency between front-of-house and back-of-house pay, and when it was discretionary, I tipped out generously. It just so happens that MY tables got attentive back-service and quality turn-arounds on special orders. I reaped the benefit in increased tips, which led to better tip-outs and on & on.

C) Remember that 50% or more of a large ($100+/seat) bill in a restaurant isn't from the kitchen; it's from the bar.

D) True chefs make profit-sharing, a much more valuable benefit than a cut of the tips.

I'm not actually on either side of this argument. I don't know if I'd want to work there as a waiter, but I wouldn't have a problem with it as a patron. While I've seen the benefit to the virtuous cycle in B), I also realize that the work in the kitchen is as-or-more important as the front-of-house work. I tried to make sure the back-of-house staff got a fair shake, but I know I'm the execption, rather than the rule.

[Karen]

You may have heard of 'Waiter Rant', a popular blog that details the life of a waiter working in NYC (www.waiterrant.net). He also reviewed this article awhile back, and was against the idea. His feeling was that if tip is included, owners would find a way to steal part of the gratuity from the wait staff.