“No Tip” Trend

bar-872161_640Have you ever found yourself pondering over your bill once you reach the gratuity line on your receipt at the end of a meal out? How much to tip can be confusing for the customers and stressful on the wait staff. The customers ponder over what the appropriate amount to leave the server is and the servers stress over whether they will get a decent tip. Depending on what state you are in there is quite a significant difference between federal minimum wage and server’s minimum wage. Recently a new trend has started sweeping through the nation: restaurants including a “service charge” into the menu price and eliminating tipping all together. These restaurants are not common but slowly more and more are popping up.

Many servers have to tip out the kitchen, host/hostess, busser, or other positions with their tips they receive based on a percentage of either their sales or percentage of their tips depending on the restaurant. Many servers earn far less than a standard minimum wage as their hourly pay but then make up the additional money through tips. However, if their shift is slow they can easily earn less than the current federal minimum wage of $7.25, according to Business 2 Community. There is some concern that taking away tips from the servers will demotivate them from doing the same quality of service, although most industries do not receive tips and are still expected to do the same quality of job for their hourly wage. On the other hand, offering a livable hourly wage might make it easier for servers to budget if they know exactly what will be their walk away pay at the end of their shift before it even starts.

There are many angles to look at with this trend and many different opinions that are held. Many consumers will likely not be happy if menu prices are raised a possible 15 to 20 percent to make up the hourly wage so the restaurant can pay their wait staff a decent wage. Others may be happy to be done with the stress of figuring out the appropriate gratuity at the end of a meal. Some restaurant industry veterans disagree with the idea of customer-dependent salary. They believe that instead of every table being a mini HR department that the servers’ performance should be evaluated and rewarded solely by the restaurant’s manager, according to The Washington Post.

Time Inc. Network posted that the first chain to try no tipping is Joe’s Crab Shack at 18 of their 131 locations. Joe’s Crab Shack has raised their prices between 12-15 percent to make up the difference between, for example, a $2.25 per hour wage to the new $14 per hour. Restaurants that have been adopting the no tipping policy have either added a service charge or added a percentage to their menu price.

As more no tip restaurants open and as more current restaurants change their policies customers can decide where to spend their money. For now it is uncertain if this trend will catch on with all restaurants and become the new standard. There might be some restaurants near you that may be changing their tipping policy, or maybe you already adapted the new no tipping policy at your establishment. Will Americans adopt the same no-tipping policy as many other countries around the world?  Only time will tell. Stay tuned or maybe check out a restaurant that has adopted the new no tipping trend!

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