15 Percent? 20 Percent? It Doesn’t Matter, Because Tipping Culture Is Fundamentally Broken

Leaving a tip isn't only payment for services, it is a mark of social and economic superiority -- which is why workers in the US resisted the system in the 19th century.
Haley Hamilton
September 5, 2017
https://melmagazine.com/15-percent-20-percent-it-doesnt-matter-because-tipping-culture-is-fundamentally-broken-465c092ba855

 

“Are you sure?” I nervously ask the bartender at Huertas, a tapas-style restaurant in Manhattan’s East Village.

He nods.

Still, I’m full of guilt.

“This feels wrong,” I tell him.

“No, really, it’s okay,” he reassures me. “We like doing it like this.”

“Okay, I mean, if you’re sure…”

And with that, I put back into my wallet all of the change he’s handed me — three dollars and change — from the wrinkled $10 bill I’d given him a few minutes earlier for a glass of wine.

No tip necessary.

By his request.

I feel like I’m stealing as I walk out the front door.

I’ve been bartending for seven years, and I wish horrible things upon people who scoop up all of their change from the bar and walk away without leaving a tip. Because as everyone who’s ever worked in a non-chain restaurant will tell you, bartending (and serving) isn’t menial labor: It’s a craft that requires a deep knowledge of foods and spirits, diplomacy under fire and long hours of physical labor. Yet it’s a job often performed for a sub-minimum wage that’s supplemented by tips that, you hope, break down to an hourly average that’s worth your time. So for me, deliberately not tipping your bartender is a sin worthy of its own circle in Hell.

Or it was.

Huertas did away with tipping two years ago, following the lead of Danny Meyer, the restaurateur behind Manhattan staples like Gramercy Tavern and Union Square Cafe and CEO of Union Square Hospitality Group, a restaurant management group. Meyer first launched tipless dining, what he calls Hospitality Included, at The Modern, the Museum of Modern Art’s Michelin-starred eatery, in November 2015. Ten more of his establishments quickly followed suit, and his other four restaurants are slated to offer Hospitality Included by early 2018.

And while Meyer is a pioneer of non-tipped dining — he first sent out a memo to his staff and business partners condemning tipping in 1994 — Jay Porter, owner of The Linkery in San Diego, was the guy who originally implemented the practice. From 2006 to 2013, The Linkery operated a no-tipping model, including an 18 percent service charge that was divided among servers and kitchen staff.

It was a practical move as much as a moral one: All of the frustrations Porter and his staff were running into — servers fighting over lucrative weekend shifts and kitchen staff fuming about bartenders making two to three times what they were because of tips — boiled down to money. “I felt there had to be a better way,” he told The New York Times Magazine in 2008. “No other profession works like this, and I don’t see why the restaurant business should either.”

In the years since, the places and spaces from which tipping is disappearing are vastly different — from Meyer’s NYC empire to Porter’s signature San Diego establishment to a tiny cafe in Somerville, Massachusetts. But the rationale for eliminating the tip line on credit card receipts and stamping menus with gratuity-free icons and slogans is the same: Tipping hurts people who work in restaurants.

For starters, as Porter told The New York Times, it allows for a giant wage gap — a difference of sometimes $50,000 a year — between the people working in the front of the house and the cooks, dishwashers and non-salaried employees in the kitchen. But maybe even worse, it’s largely the reason why the restaurant industry is the nation’s single largest source of sexual harassment claims. Most of my fellow servers and bartenders and I put up with comments that make our skin crawl (“I’m not leaving here without your number”) and the “accidental” brushing of our asses, because how much a person tips is usually directly related to how much they’ve gotten their way.

Still, when I bring up the idea of not tipping with some of my fellow bartenders, there’s resistance. Like, fuck you, resistance. Which makes sense: No one will do what we do for $15 an hour — and that’s if the federal minimum wage requirement is increased from $7.25. (On most nights, I average $25 to $30 an hour, and if I didn’t, I’d find another job.)

But there’s no denying that tip culture feeds both the sense of entitlement of many of the people who frequent bars and the greed of large restaurant corporations. And while I’ve worked for some of the most honest, intelligent, talented and dedicated people I could ever hope to meet, I’ve also worked for people who run their business like a factory, where owners view staff like machinery: If it makes noise or wears out, get a new one.

These are the people who will tell you it’s a privilege to work for them, and if you have a problem with 80-hour work weeks, get out. These are the people who will answer your complaints about a drunk guy groping you as you walk past his table with, “Well, you wore those shorts.” And these are the people who’d never be in the restaurant industry if they were responsible for more than half their staff’s wages.

The practice of tipping dates as far back as the 15th century and Tudor England. On visits to the manors and castles of their friends, the upper-classes and landed gentry were expected to leave coins for the household servants who, due to the increased occupancy of their masters’ homes, were performing more work than their standard wages covered. By the early 20th century, tips were so ingrained in upper-class British culture that a trip to a friend’s mansion meant bringing nearly $100 in cash for the servants.

Thus, a tip wasn’t only paid for services, it was a mark of social and economic superiority, which is why, when the custom crossed the Atlantic in the 1800s, it was originally shot down as un-American. “Tipping, and the aristocratic idea it exemplifies, is what we left Europe to escape. It is a cancer in the breast of democracy,” William R. Scott wrote in The Itching Palm in 1916.

Laws against tipping cropped up in Washington, South Carolina, Mississippi, Arkansas and Iowa in in the early 1900s. None of them, however, lasted more than 10 years; they were overturned or struck down as unconstitutional. Individual establishments, hotel groups and travel associations also tried to do away with tipping, but their efforts were mostly futile because doing away with tips meant employers had to pay higher wages.

Tipping was still a contentious matter when the federal minimum wage (25 cents an hour at the time) was established in 1938 — despite the dismay of First Lady Eleanor Roosevelt, who called tipping “a result of an insufficient living wage.” “If tips must be relied on for part of the income for waiters,” she told The New York Times (per Kerry Segrave’s book Tipping: An American Social History of Gratuities), “then I think they might better be included in the bill and the total pooled and distributed among employees on payday” (which is exactly what Porter did at The Linkery 80 years later).

In 1942, the Supreme Court sided with employers, ruling that under the Fair Labor Standards Act, they were required to pay the established minimum wage, but that tips received from patrons or customers could be included in wages, allowing the hourly wage paid to workers to plummet as long as tips kept coming in.

Today, the federal minimum wage for employees who take home at least $30 a month in tips is $2.13 an hour, while the federal minimum for non-tipped employees is $7.25. If an employee’s tips don’t average to the federal minimum wage for non-tipped workers ($7.25), the employer must make up the difference. (Unless you live in Alaska, Oregon, California, Washington, Nevada, Montana or Minnesota, which require the same minimum wage to be paid regardless of whether an employee takes tips or not.) But noncompliance is a huge issue; an employee basically has to bring it up, which, again, puts their standing at risk — most notably, in the shifts they’re assigned to work (i.e., the ones that bring in the most tips).

This leaves the burden of paying for the expertise and performance of servers and bartenders on the dining public. Or put even more simply: “The restaurant owner has made it the customer’s responsibility to pay its employees,” says Sharon Block, executive director of the The Labor and Worklife Program at Harvard Law School.

Which, when you think about it, is fucked up. Shouldn’t the people whose business I’m helping be successful be responsible for paying me? Not to mention, how can I be rewarded for a stellar job performance if my wages come from people culturally obligated to leave extra money on the table? And what happens when it’s a slow day?

Unfortunately, the answer to the last question is easy: I’m essentially working for free.

When Josh Lewin and Katrina Jazayeri decided to open a brick-and-mortar restaurant, Juliet, after the success of their Bread & Salt pop-up in Boston’s South End, they knew they weren’t going to allow tipping. “We suspected compensation was at the bottom of a lot of issues in the industry — harassment, turnover, wage abuse,” Jazayeri explains. “We said we’re not going to participate in that.”

And so, they run Juliet on what’s called an “Open Book Strategy,” a profit-sharing model based on prioritizing staff participation not just as employees, but in the business of the restaurant itself, teaching each employee about overhead, profit margins, rent, labor costs, etc. Under an Open Book Strategy, staff members are paid both hourly and a percentage of profits.

Profits, though, can take time to develop. In Juliet’s case, it was 14 months before revenue outpaced costs. “We’re greatly appreciative of our staff for being so open and patient with us,” Lewin told his staff when announcing the cut of Juliet’s first round of profit-sharing checks in April. “There wasn’t a model to compare this to when we opened.”

“Front-of-house took a hit financially,” says Katie Rosengren, Juliet’s operation manager. “I make less money than I probably could, and less than I have, but I don’t necessarily look at it in those terms. For me at least, the benefits of this job outweigh the financial differences.”

Profit-sharing also fixes maybe the worst aspect of the current restaurant pay system: the differences in earnings between the front and back of the house. “There’s a canyon’s worth of difference [in income],” says Noah Clickstein, a server at Juliet. “I would walk away with three times what the back-of-house was making. And the lack of unity and culture drove people away. That’s why I love being here.”

“I don’t know what keeps cooks from taking off their aprons halfway through the night and just walking out,” says Brendan Murray, former chef de cuisine at Duckfat, one of the standout restaurants in the foodie haven of Portland, Maine. “My mom was a waitress, and she wouldn’t have been able to provide for our family as a cook. It’s an impossible feature of our industry.”

In fact, the only way an experienced line cook can afford to live in Boston, Manhattan or San Francisco is because of the overtime that comes with grueling 80-hour work weeks.

Ashley Campbell, Meyer’s chief financial officer, told Eater in October 2015that one of the goals of Hospitality Included was to “stabilize the back of the house, so we can give the gift of a regular schedule. I know that our back-of-house team members really do want to work over 40 hours, but they don’t want to work 70 hours either.”

Now, the sad truth: For all the benefits of gratuity-free restaurants listed here, it’s a model that, realistically, still might not work.

It could, for starters, limit the number of people who try to open a restaurant of their own. It also could put existing establishments in tourism-heavy regions and small towns out-of-business. “In places like Maine, outside of Portland, you’re almost immediately in a rural, poverty-stricken area,” explains Murray, who got his start at a restaurant in one such place. “If you have a business, you skate by paying minimum and sub-minimum wage — and even then you hope you make your money in the summer to stay alive.”

But most of all, it might drastically alter the labor pool for bartenders and servers.

For instance, Imbibe Magazine recently published a feature about the key role restaurants play in supporting immigrants in their pursuit of the American Dream. Because many positions primarily rely on work ethic and the ability to learn on the job (as opposed to fluent English or a college degree), a gig as a dishwasher, prep cook or bar-back is often the first step toward a life in the U.S.

What’s more: “There’s ample opportunity to move up the ranks in most bars and restaurants, including my own. It’s a meritocracy,” Jim Meehan, founder of Manhattan’s favorite speakeasy, PDT, told Imbibe.

The same can be said for Americans who are new to the workforce. I interviewed every regional winner of this year’s Speed Rack competition, nearly all of whom listed server or hostess as their first job.

It certainly was for me. At 17, I started working in a shitty barbecue joint as a hostess/cashier/drive-thru person. A year later — or more or less the moment I was old enough to serve booze in the U.S. — a server called in sick, and I got a section of tables for the night. I didn’t suck at it. So I kept waiting tables there until I went off to college.

I’m not sure these opportunities would be there — for either teenagers or immigrants — if the pay scale shifted and restaurants and bars had to pay their employees more. The barrier to entry just might be too high for business owners to take a chance on someone with no experience.

I believe, though, that’s the worst-case scenario. And that the benefits are too great to ignore. These models and their increased wages could mean that more restaurants aren’t open 365 days a year—meaning staff would get to spend time with their families during holidays; work weeks wouldn’t consist of every waking hour; there would be no agonizing over giving up a Saturday-night shift if you wanted to attend an event. Staffing would be more efficient, too, cutting hours for floor staff when it was slow instead of keeping people standing around for $3 an hour to wait for a rush that will likely never come.

In an industry that exists to create and augment the experiences of others, I don’t think it’s too much to ask that staff be fully included in that philosophy.

Haley Hamilton is a Boston-based freelance writer who covers restaurant culture, social innovation and her adventures in crushing anxiety. She last compiled a gentleman’s guide to settling a bar tab.

September 20, 2017