If you happen to have a late-November reservation at the Modern, Danny Meyer’s two-Michelin-star restaurant in New York’s Museum of Modern Art, here’s some good news: When the bill comes, you’ll no longer have to do any fuzzy math on a full stomach and a few glasses of champagne. Meyer, head of the Union Square Hospitality Group, announced Wednesday that he is eliminating tipping at his fullservice restaurants, beginning late next month.
Unfortunately, there’s some bad news, too: Meyer’s initiative, which he is calling Hospitality Included, will raise prices 20 to 35 percent. So that $138 tasting menu could soon cost about $170.
The new policy will be rolled out at all of Meyer’s restaurants in the next year; Shake Shack, his fast-food chain — and his only D.C. presence — will not be affected by the change. But as the restaurant industry begins to rethink the way its employees are compensated, the no-gratuity business model — which has already been implemented in two local restaurants — may catch hold in Washington.
Though Meyer certainly isn’t the first restaurateur to eliminate tipping — restaurants such as New York’s Dirt Candy and Chez Panisse in Berkeley, Calif., have already instituted service charges instead — his 13 restaurants will set a high-profile example for others in the industry struggling to retain an often low-paid staff.
That’s because the reasons for eliminating tipping go beyond just sparing diners an arithmetic problem when they’re a little tipsy. Tipping is an unequal system by which servers can make more than three times what highly trained cooks preparing the food earn, even though a waiter’s base minimum wage is less. That’s one of the primary reasons Meyer says he is doing away with the practice.
“We believe hospitality is a team sport, and that it takes an entire team to provide you with the experiences you have come to expect from us,” Mayer wrote in a statement. “Unfortunately, many of our colleagues — our cooks, reservationists, and dishwashers to name a few — aren’t able to share in our guests’ generosity.”
He put it in starker terms to the Web site Eater: “I hate those Saturday nights where the whole dining room is high-fiving because they just set a record, and they’re counting their shekels, and the kitchen just says, ‘Well boy, did we sweat tonight,’ ” Meyer said.
To be fair, tipping can also be unjust to servers, whose livelihoods depend on the whims of hard-to-please guests. For every $10,000 windfall, there’s a night where a waiter gets a foreign tourist unfamiliar with American tipping customs who leaves nothing. Which in turn can lead to servers fighting over tables they see as big spenders and stereotyping minorities and international guests, whom they perceive to be poor tippers.
You may think that tipping motivates good service, but in fact, the correlation is murky. Michael Lynn, a Cornell University professor of consumer behavior and marketing who studies tipping, has found that the amount of a tip isn’t what motivates waiters — it’s the number of tables they can serve in a given night. But when Lynn compared Miami restaurants with a conventional tipping system with eateries that have a flat service charge, he found that diners considered their service to be better at the tipping establishments. Apparently, the suggestion of a link between tipping and service is enough to influence both diners’ and servers’ perceptions.
There are already restaurants in Washington experimenting with the no-tip model. Sally’s Middle Name, an H Street NE restaurant that opened this summer, adds an 18 percent service charge that is split evenly among all employees (excluding owners) working a shift. Servers there make a base wage of $10.50 per hour, compared with the District’s minimum tipped wage of $2.77 per hour.
There has been some grumbling about the system on Yelp, and in a review, Washington Post restaurant critic Tom Sietsema writes that “Sally’s employs a few waiters who seem more intent on hanging out, or pushing diners to order more food, than on considering what diners might actually want or need.” But co-owner Aphra Adkins said that no one has expressed any disappointment to her.
Adkins hopes that Meyer’s decision will have a ripple effect in the industry.
“I think it definitely shows that it’s on everybody’s mind to make sure that everyone who’s working for them, and everyone in the community, is being treated fairly and making the money they deserve,” she said.
The biggest difference between Sally’s Middle Name and the Modern is that Meyer has eschewed a service charge, building the cost of labor into his menu prices. It’s a risky move that could turn off diners. And it could deter servers, too: Many servers at high-end restaurants prefer tips because they can make much more money. Plus, there’s the transparency of tips: Tipped wages are legally protected, and though servers may choose to pool their tips with busboys and other front-of-house staff, that money can’t be touched by owners or cooks. Meyer says he’s working on a transparent system that will keep his servers’ wages the same, or better, but many longtime servers in the industry fear the loss of that protection against wage theft.
That’s part of the reason Adkins went with the service charge: “That 18 percent is kind of our way of saying, ‘We’re being open and honest with you,’ ” she said. “It’s not going into our pocket.” Another D.C. brewpub, the Public Option, has built tips into its prices — but it has been open for only a week and isn’t yet serving food. The owners are so far the only employees.
Saru Jayaraman, co-director of Restaurant Opportunities Centers United, a group that advocates for better wages for restaurant workers, applauded Meyer’s decision in a statement, saying it “sets a powerful example for New York restaurants and beyond.”
“Dignity and profitability are not mutually-exclusive ideas at America’s restaurants,” said Jayaraman’s statement. “Eliminating the two-tiered wage system is essential to ensuring a fair and just future for the nation’s 11 million restaurant workers.”
Whether diners will find it fair remains to be seen. And if not? They’ll always have Shake Shack.