The idea of eliminating tipping at restaurants made headlines this week, but locals in the industry aren't sure that would work well.
"I could never see it happening in the industry because [tipping] is such a common thing in the U.S.," said Mike Monen, who—along with this wife, Taylor—owns restaurants Community Pie, Urban Stack, Taco Mamacita, and Milk and Honey.
This week, Jay Porter, owner of now-closed San Diego restaurant Linkery, wrote for Slate.com that "eliminating tips makes it easier to provide good service."
Instead of the tip system, Porter adopted an 18 percent service charge. That charge is a little less than the average customer typically tipped, according to the article.
Porter and his crew refused to accept any payment beyond the service charge, and if someone left money on the table, the team donated it to a charity.
"We made this change because we wanted to distribute the 'tip' revenue to our cooks as well as our servers, making our pay more equitable," Porter wrote. "Servers and cooks typically made similar base wages—and minimum wage was the same for both jobs—but servers kept all the tips, which could often mean they were taking home three times what the cooks made, or more."
At the time, it was illegal to distribute any tip money to cooks in California, although recent court rulings have loosened that a bit, according to the Slate article.
Chattanooga server Stephen Pollard, who works at a restaurant in the Hamilton Place area, said his place of work tried eliminating tips and implementing an 18 percent service charge. It didn't work.
Customers complained about not being able to take control over the money they left, he said via email.
The restaurant seemed to lose business, and customers felt insulted by the move, he said.
Eventually, leaders eliminated that system.
"As for whether tipping should be eliminated, I would say the service charge is a better route, but I made, on average, more money under that system, so I'm obviously biased," Pollard said. "But realistically, if tipping is out the window, it's either service charges or the restaurants will jack up prices so they don't lose profit while paying servers fair wages."
But Porter had a different experience. The food improved at Linkery, probably because the cooks were getting more money and didn't feel taken for granted, Porter wrote.
And business picked up, and the servers were making more money than they had under the tip system after a couple of months, he said.
"The quality of our service also improved," Porter wrote in the article. "In my observation, however, that wasn't mainly because the servers were making more money (although that helped, too). Instead, our service improved principally because eliminating tips makes it easier to provide good service."
The conventional wisdom is that the better the service, the better the tip.
But a Cornell University study found that customers don't vary tips much based on good or bad service.
And Monen agreed with that.
"I would never not tip," he said. "I don't find myself leaving less because it was poor service."
He has two different tip levels—the standard amount he gives no matter what and a bigger percentage for great service.
"I do find myself rewarding great service but not punishing for mediocre [service]," he said.
If that's the case for most other customers, then there isn't much incentive to provide better service.
But Pollard said the bigger issue is that people are being more frugal, especially after the recent recession.
Ten percent is the new 20 percent, he said.
"People are not as generous as society thinks," he said.
He's been serving for nearly two years but has talked to people who have worked at many restaurants for years, he said.
"Evidently, receiving $20 tips was quite regular a few years ago," he said. "Now, you're probably not going to get a $20 tip unless the bill is over $100, and sometimes not even then. That being said, there are still plenty of generous customers out there. Last night, for instance, a party of three tipped me $32 on a $67 check: a 47 percent tip."
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