Author Topic: No-Tipping Policy In Restaurant  (Read 6644 times)

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Millionaire Maria

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Re: No-Tipping Policy In Restaurant
« Reply #15 on: June 17, 2014, 02:45:04 AM »
There's a new restaurant not too far from me that intends to do this, as well.

As much as I applaud the idea, I think that they could have trouble recruiting staff.  Here, wait-staff must be paid the provincial minimum wage.  And in high-end restaurants, especially those in tourist areas (such as the one I'm referring to), the waiters can make a very nice living even after portioning tips out to support staff.

They will have trouble recruiting if they are offering significantly less than minimum wages plus tips. If they are offering close to that, they won't.

I think they may have more problems with patrons, since their menu prices will have to be higher than other restaurants, to pay that salary. Some people will have no problem seeing that they won't have to add 15% or 20% on top of the price, others will feel it is too expensive, since they will still be mentally add a tip, from habit.


In many instances, they'd have to pay something like $ 25/hour to match what servers currently get at a restaurant like this, including tips. That's more than twice minimum wage here.  Let me emphasise that I'm talking about a high-end restaurant here; I'm certainly not asserting that servers at a family-type chain make this much.

As a customer, I don't like tipping in general and would be happy to pay a bit more on the menu price.  But many wait staff, especially very good ones, quite possibly wouldn't get the wages they currently enjoy.

A great many servers should be getting twice the minimum wage, because their hard work reflects that. We are talking about a supply and demand economy here. If the high end restaurants don't want to change to reflect the new model, they will feel the economic sting when their well trained staff flock to different restaurants. I don't understand why people think that changing the paradigm in the restaurant industry will cause mass chaos, when it appears to be working well elsewhere. Good lawyers work at prestigious law firms, mediocre ones work at regular law firms. If someone wants an amazing lawyer, they go to a prestigious law firm. And then they pay for it. If someone is making a low budget movie, they usually use amateur actors and pay them appropriate wages. Nobody gets bent out of shape because Angelina Jolie didn't appear in Sharknado and no restaurant owner, or patron, should be getting upset that well trained and highly skilled service industry people would choose to work for higher paying restaurants. 
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lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #16 on: June 17, 2014, 09:36:51 AM »
I think it sounds like a good idea. Whether or not it will spread is a different story.

The $10 is the part that makes it sticky. Because how that will compare to the 20% of sales, will totally depend on the food prices in the restaurant. If it's a high end place where dishes fall in the $30-$45 range, the 20% is easily going to top the $10. And for a restaurant where $10 might be on par with the 20%, is the restaurant going to raise the $10 base wage whenever they raise menu prices?


lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #17 on: June 17, 2014, 09:40:47 AM »
$10 or 20 percent of hourly food sales - makes me wonder if waitstaff might be tempted to hurry one table along in order to seat the next family and sell them more food.

If this were an issue, it would already be one as servers are already dependent on selling a lot of food to make their money. Whether that comes from tips based on amount sold or wages based on amount sold wouldn't make any difference. It's still based on amount sold.

Not to say that it isn't already an issue. It may very well be and probably is in certain establishments. But I don't think this change would exacerbate the situation.

Onyx_TKD

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Re: No-Tipping Policy In Restaurant
« Reply #18 on: June 17, 2014, 11:58:39 AM »
I think it sounds like a good idea. Whether or not it will spread is a different story.

The $10 is the part that makes it sticky. Because how that will compare to the 20% of sales, will totally depend on the food prices in the restaurant. If it's a high end place where dishes fall in the $30-$45 range, the 20% is easily going to top the $10. And for a restaurant where $10 might be on par with the 20%, is the restaurant going to raise the $10 base wage whenever they raise menu prices?

Why is it "sticky" and why would they need to adjust the base wage based on food prices? ??? From the article (bolding mine):
Quote
Here’s how it works: servers are paid $10 an hour OR 20% of their individual food sales during their shifts–whichever amount is higher.
The servers get whichever pay system works out to more money for them. If food prices are high and business is good, they'll get paid 20% of their sales. If business is bad or food is really cheap, they'll get $10 an hour. Either way, their pay will be equal to or greater than a guaranteed 20% tip. The base wage only becomes relevant in situations where they wouldn't have been making more than $10 per hour in tips anyway (unless they're in an area where almost everyone consistently tips more than 20%, which I doubt), so raising it along with the menu prices seems like a minor issue--the higher the menu prices, the more likely that they'll be paid the 20% instead of the base wage.

lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #19 on: June 17, 2014, 12:25:10 PM »
It's sticky because as time goes on, the $10 will approach, in worth, the $2.13 (or whatever base now is) of today.

So, either the base of $10 has meaning or it doesn't. It's meant to be a minimum, so the servers will be guaranteed at least $10 per hour, whether or not the restaurant is busy, whether or not a server gets some low-ordering tables, etc. But as the $10 becomes worth less over time, it will just become like today's minimum wage which was set so many years ago.

So if the 20% is always going to come into play, then why bother invoking any minimum? But if there is actually a need to invoke a minimum, then that minimum needs to keep up with inflation.


Goosey

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Re: No-Tipping Policy In Restaurant
« Reply #20 on: June 17, 2014, 12:28:03 PM »
So, wages shouldn't improve now because inflation will eventually catch up?

wolfie

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Re: No-Tipping Policy In Restaurant
« Reply #21 on: June 17, 2014, 12:30:05 PM »
It's sticky because as time goes on, the $10 will approach, in worth, the $2.13 (or whatever base now is) of today.

So, either the base of $10 has meaning or it doesn't. It's meant to be a minimum, so the servers will be guaranteed at least $10 per hour, whether or not the restaurant is busy, whether or not a server gets some low-ordering tables, etc. But as the $10 becomes worth less over time, it will just become like today's minimum wage which was set so many years ago.

So if the 20% is always going to come into play, then why bother invoking any minimum? But if there is actually a need to invoke a minimum, then that minimum needs to keep up with inflation.

Because you might have a day where most of your tables camp with just tomato soup and water and 20% of that is not going to be $10 and hour. But I see the "when prices are raised will their wages be raised" as the same as those of us who aren't waiters. Just because my company made a lot of money this year doesn't mean I will get a raise. Minimum wage hasn't changed for years. I would assume this restaurant will keep their fingers on the pulse of the business and raise that minimum if they need to.

lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #22 on: June 17, 2014, 12:34:35 PM »
So, wages shouldn't improve now because inflation will eventually catch up?

No, the exact opposite. Wages should not stagnate because if they do, inflation will catch up.
The $10 needs to improve over time. That's all I'm saying.
And I've seen the opposite happen. $10 minimum sounds good now, but if it never changes, it's not very good at all.

Goosey

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Re: No-Tipping Policy In Restaurant
« Reply #23 on: June 17, 2014, 12:36:40 PM »
So, wages shouldn't improve now because inflation will eventually catch up?

No, the exact opposite. Wages should not stagnate because if they do, inflation will catch up.
The $10 needs to improve over time. That's all I'm saying.
And I've seen the opposite happen. $10 minimum sounds good now, but if it never changes, it's not very good at all.

Ah, okay I think I get what you're saying. I think I was reading that you were saying that it shouldn't be done because $10 will eventually be nothing. But, what you're saying is that $10 is good for now, but market wages should be met?

lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #24 on: June 17, 2014, 12:37:43 PM »
It's sticky because as time goes on, the $10 will approach, in worth, the $2.13 (or whatever base now is) of today.

So, either the base of $10 has meaning or it doesn't. It's meant to be a minimum, so the servers will be guaranteed at least $10 per hour, whether or not the restaurant is busy, whether or not a server gets some low-ordering tables, etc. But as the $10 becomes worth less over time, it will just become like today's minimum wage which was set so many years ago.

So if the 20% is always going to come into play, then why bother invoking any minimum? But if there is actually a need to invoke a minimum, then that minimum needs to keep up with inflation.

Because you might have a day where most of your tables camp with just tomato soup and water and 20% of that is not going to be $10 and hour. But I see the "when prices are raised will their wages be raised" as the same as those of us who aren't waiters. Just because my company made a lot of money this year doesn't mean I will get a raise. Minimum wage hasn't changed for years. I would assume this restaurant will keep their fingers on the pulse of the business and raise that minimum if they need to.

An assumption, yes. If they do, great! If they don't, well, all I'm saying is that they need to. I won't assume they will, though, based on experience. And you've voiced one of the main reasons why I won't assume they will: "Minimum wage hasn't changed for years."

lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #25 on: June 17, 2014, 12:39:36 PM »
So, wages shouldn't improve now because inflation will eventually catch up?

No, the exact opposite. Wages should not stagnate because if they do, inflation will catch up.
The $10 needs to improve over time. That's all I'm saying.
And I've seen the opposite happen. $10 minimum sounds good now, but if it never changes, it's not very good at all.

Ah, okay I think I get what you're saying. I think I was reading that you were saying that it shouldn't be done because $10 will eventually be nothing. But, what you're saying is that $10 is good for now, but market wages should be met?

Right.
And in addition, I'm saying, I would be surprised if they do actually continually improve the $10 to meet market wages. Not saying it won't happen. Just saying it doesn't usually happen unless it somehow gets legislated.

Goosey

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Re: No-Tipping Policy In Restaurant
« Reply #26 on: June 17, 2014, 12:42:11 PM »
So, wages shouldn't improve now because inflation will eventually catch up?

No, the exact opposite. Wages should not stagnate because if they do, inflation will catch up.
The $10 needs to improve over time. That's all I'm saying.
And I've seen the opposite happen. $10 minimum sounds good now, but if it never changes, it's not very good at all.

Ah, okay I think I get what you're saying. I think I was reading that you were saying that it shouldn't be done because $10 will eventually be nothing. But, what you're saying is that $10 is good for now, but market wages should be met?

Right.
And in addition, I'm saying, I would be surprised if they do actually continually improve the $10 to meet market wages. Not saying it won't happen. Just saying it doesn't usually happen unless it somehow gets legislated.

Well, simply by offering this $10 or 20% wage standard, this restaurant is showing that they are willing to move beyond the status quo to the benefit of their employees.

lowspark

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Re: No-Tipping Policy In Restaurant
« Reply #27 on: June 17, 2014, 12:49:59 PM »
Oh, I agree!

My original post was meant to point out that while $10 might be the right minimum for that restaurant for today, it won't be tomorrow.

But in addition to that, it wouldn't be the right minimum, even today, for every restaurant. Some restaurants, it might be too high and they'll just hit that $10 every time, which would be great for the servers but might break the budget for the restaurant. In some places, it's going to be too low and they'll never hit that $10, even on a bad day. And maybe in some places 20% might be too low if their regular clientele normally tips higher than that.

My point is that it sounds like a great idea and those particular numbers might work for that particular eatery.
But if it were going to be something implemented across the board for a lot of restaurants, those two numbers might need to be tailored for each place and adjusted periodically.

lady_disdain

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Re: No-Tipping Policy In Restaurant
« Reply #28 on: June 17, 2014, 12:50:25 PM »
So, wages shouldn't improve now because inflation will eventually catch up?

No, the exact opposite. Wages should not stagnate because if they do, inflation will catch up.
The $10 needs to improve over time. That's all I'm saying.
And I've seen the opposite happen. $10 minimum sounds good now, but if it never changes, it's not very good at all.

But that is true of anyone who receives a salary - the waiter, the bank teller, the secretary, etc.

wolfie

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Re: No-Tipping Policy In Restaurant
« Reply #29 on: June 17, 2014, 12:53:02 PM »
Oh, I agree!

My original post was meant to point out that while $10 might be the right minimum for that restaurant for today, it won't be tomorrow.

But in addition to that, it wouldn't be the right minimum, even today, for every restaurant. Some restaurants, it might be too high and they'll just hit that $10 every time, which would be great for the servers but might break the budget for the restaurant. In some places, it's going to be too low and they'll never hit that $10, even on a bad day. And maybe in some places 20% might be too low if their regular clientele normally tips higher than that.

My point is that it sounds like a great idea and those particular numbers might work for that particular eatery.
But if it were going to be something implemented across the board for a lot of restaurants, those two numbers might need to be tailored for each place and adjusted periodically.

How is that different from any other industry?