Hopefully we can keep this from getting political.

Joe's Crab Shack Is the First Major Chain to Drop Tipping | News OK (http://newsok.com/article/5459659)

I think this is a start of an interesting trend. As a consumer, great. I like the idea of not having to feel obligated to tip even with lousy service. However, as a waiter I'd be kind of bummed. Even 20 years ago I was making more than $14 an hour as a waiter.

I'm curious if this trend will continue. I'd especially like to see this implemented at places were people don't consistently tip, yet they still pay waitstaff the tip earner wage (Sonic, etc). I know it's a real problem in cities with large amounts of European tourists, who aren't used to tipping.

I could see a lot of wait staff going to other places. Lots of people like making tips. Should be interesting.

Saying that it doesn't make me all the sudden want to go to Joe's Crab Shack. I do not really enjoy the food.

I agree with jerry about how this might get interesting. I'm not sure what they make now but my daughter used to work for Joe's and it was a crap shoot on getting tips and keeping track of them. I'm sure she would have preferred a straight hourly wage. My biggest question is the quality of service since they don't have to rely on tips.

I'll be fascinated to see where this, and where restaurant service in general goes over the next 5 to 10 years.

What people make varies widely from restaurant to restaurant, but servers in OKC are generally all making a floor of $10/hour. The median is probably closer to $15/hour with the average a few dollars higher than that. So for some it may represent a pay cut and for some it may not. The issue will be for those in better positions at nicer restaurants. Most servers working at nicer restaurants around town have a floor of $20/hour, a median of probably $25/hour, and an average of over $30/hour. Most all of those servers are getting paid $2.13/hour currently.

If the market trend leans toward a change in customer behavior that more or less forces the hands of restaurants to move to a wage based system, upscale dining servers will likely be hurt. There are more than a few making $35 - $45/hour and there's simply no way that is going to be achieved through standard wages paid by the restaurant. There are many upscale servers who retain their positions longer because the money is too good to pass up. A move toward wage-based pay would likely signal the end of many servers tenure in the industry because it may no longer be worth it. This would certainly cause a dip in quality of service at the nicest of establishments.

At the end of the day, we won't find out until this is actually implemented throughout many chains. But based on the service I've received in Europe and Argentina, I would expect to see some noticeable changes in dining in our culture. This could be a good thing, or it could be a frustrating thing. I'd personally love for our dining times to expand by about 30% to 50%. So dinners that normally take 45 minutes taking an hour. Hour long dinners taking an hour and a half. This will certainly be a step in that direction by necessity since restaurants will cut down on front of house staff leading to increased average service times.

I agree with jerry about how this might get interesting. I'm not sure what they make now but my daughter used to work for Joe's and it was a crap shoot on getting tips and keeping track of them. I'm sure she would have preferred a straight hourly wage. My biggest question is the quality of service since they don't have to rely on tips.


To be sure, I don't think quality of service from any given server will change. It will either be the same or better under a wage-based system than a tip-based system.

Rather, I think the bigger risk is the quality of the server. Good servers make more money in the industry than they would working a desk job at some random company, and they have an obscene amount more flexibility than those same people. There are certain advantages a 9-5 can't offer that a restaurant industry job can, and so there are people with high aptitudes staying in restaurants because they can make the money they want and live the lifestyle that fits them better. But if the market unwittingly puts a cap on that earning potential, you're going to lose some of those people with high aptitudes, simply because it's no longer worth their time.

Intriguing, indeed.

I've read a few supposed European responses to this and they advised against it (of course, I'm sure we could find plenty applauding it). The main reason being:

In America, the staff tries to make your time spent and money spent worth it as they chase tips. Simply put: service is better because they have something work towards with tips.
Without tips, service is compromised because the staff knows they're getting paid, regardless.
Additionally, the food and drink costs increase, in this case by 15%.

Over the course of a meal for a family, that total increase may be more than what you usually tip (even if you tip "generously"), making the total cost of the meal more expensive. I'd be curious to see the math.

Are there many nicer dining establishments turning tables in under an hour?

Unless there is a reason to hurry, such as a more rapid bite before/after court due to another court/appointment, eating alone at a casual sit down spot typically closes in on or exceeds an hour.

I don't recall the last dinner out my lovely and I had that would have run less than 90+ minutes, lower scale or higher. Generally 120+ if we are dining with another couple or some of the family.

However, we are quite prone to dine outside the typical popular time slots as I am never going to be confused as someone who is a fan of crowded places. That may be why we don't tend to have anyone trying to swoosh us up and out.

And if I have great service, a no tip sign isn't going to mean much to me.
I'm still old school enough where tipping is a sign of respect for the effort expended, not simply an expected obligation to the shopkeep for me to help meet their payroll needs.

...Most all of those servers are getting paid $2.13/hour currently.

Just want to make sure it's clear - if they get paid below minimum wage and the difference isn't made up by tips, the employer has to make up the difference between what they made and minimum wage, they do not just make $2.13/hour if they get no tips. Tons of people don't know the employer has to make up the difference between what they make per hour and minimum wage if what they made is less than minimum wage.

Just want to make sure it's clear - if they get paid below minimum wage and the difference isn't made up by tips, the employer has to make up the difference between what they made and minimum wage, they do not just make $2.13/hour if they get no tips. Tons of people don't know the employer has to make up the difference between what they make per hour and minimum wage if what they made is less than minimum wage.

The trouble is, some places don't make up the difference and the employees are afraid to file complaints. I know a few personally.

Intriguing, indeed.

I've read a few supposed European responses to this and they advised against it (of course, I'm sure we could find plenty applauding it). The main reason being:

In America, the staff tries to make your time spent and money spent worth it as they chase tips. Simply put: service is better because they have something work towards with tips.
Without tips, service is compromised because the staff knows they're getting paid, regardless.
Additionally, the food and drink costs increase, in this case by 15%.

Over the course of a meal for a family, that total increase may be more than what you usually tip (even if you tip "generously"), making the total cost of the meal more expensive. I'd be curious to see the math.

The only potential "hidden cost" for the guest is that they would have to pay tax on the new subtotal. You don't have to pay tax to tip someone (but if you tip on the post-tax total, it's essentially a moot point).

If a menu item is $10, the guest in Oklahoma pays $10.84 + Tip. So the grand-totals would be as follows:

w/ 10% tip - $11.92
w/ 15% tip - $12.47
w/ 20% tip - $13.01

In a scenario where menu prices are raised 15% but no tip occurs, the price for the Oklahoman would be $11.50 + tax = $12.46

So in terms of money, governments both municipal and state/federal will all likely see tax receipts grow from the hospitality industry. The guest will likely save a bit of money, and servers will likely lose out the most. Back of House (kitchen) staff will likely make more money. Restaurants may or may not make more money…They will have to start paying for staff that servers subsidize in most restaurants (Bus, Host, Bartender)

It would save me at the bar, I know. I tend to drop a dollar as a tip every time I get a beer (if I'm paying cash). So my tipping often runs 35-50%.

Just want to make sure it's clear - if they get paid below minimum wage and the difference isn't made up by tips, the employer has to make up the difference between what they made and minimum wage, they do not just make $2.13/hour if they get no tips. Tons of people don't know the employer has to make up the difference between what they make per hour and minimum wage if what they made is less than minimum wage.

That's not at all my point. None of the servers I'm talking about in that passage have any realistic shot of making so little money (minimum wage).

The point is that there are servers out there making $30/hour in tips and more. Their employers are paying them $2.13/hour. Nobody in their right mind thinks that a restaurant is going to be able to go from paying a sever $2.13/hour to $30/hour by a measly 15% increase in menu prices.

Regarding the law, the employer only has to meet those standards on a pay-period basis. If you log 5 hours in a shift and make $20, but over the pay period you log 50 hours and make $400, the restaurant owes you nothing for your crappy shift(s).

It would save me at the bar, I know. I tend to drop a dollar as a tip every time I get a beer (if I'm paying cash). So my tipping often runs 35-50%.

So you're buying $2/$3 beers?

So you're buying $2/$3 beers?

Too good for PBR?

Exactly!

Also Coop (cans). Skinny Slim's has them at happy hour for $3 a can, and I work right by the Edmond one, so tend to go their after work most days.

Hopefully we continue to see the domino effect. Employers should be responsible for paying their employees. I would much rather spend more on menu prices than play games with my server and the others at the table.

And to tack on the comments above about bars and beer. The profit margin is already insane on most alcohol, especially canned/bottled beer that requires essentially zero skills to serve. Tipping $1 per trip to the bar is not only padding the owner's pockets nicely by buying the beer, but you are also now tipping very graciously to all of the staff.

And to tack on the comments above about bars and beer. The profit margin is already insane on most alcohol, especially canned/bottled beer that requires essentially zero skills to serve. Tipping $1 per trip to the bar is not only padding the owner's pockets nicely by buying the beer, but you are also now tipping very graciously to all of the staff.

Oh yeah, I know that. I just find it hard not to tip with each transaction. If I'm running a tab, I'll do a percentage calculation on the total, which ends up being considerably less, so I prefer to do so when possible. But if a bar is especially busy, I'll pay as I go.

I just came back from Spain, and I didn't find the service any different than here if you take in account Spain's customs. The waiters all were attentive to my table's needs, they all seemed to care about their jobs and side duties as well. The only thing which is customary in Spain is you do have to ask for your check when you are ready to pay the bill, other than that there isn't much difference, and you can tip the waiter 1-2 Euros if you fell the service was good. Food and drinks seemed to be cheaper than here in America, especially wine and coffee. I ate breakfast for under 2 Euros at this little bar, it was toasted demi-baguette topped with shredded tomato, olive oil, and sea salt, and an espresso. Wine was usually 2-5 euros a glass as well. Some of the fancier restaurants of course you would pay more, but generally even in the touristy areas it was about the same if not a bit cheaper.

When we were in Paris (no tips allowed), the service was *way* beyond any service we've had at any but the best/priciest restaurants here in the USA, and we ate at places that ranged from cheap to expensive.

What I find interesting about this is that Joe's is really just the most publicized chain to go to a no-tip policy. There are smaller chains that did this long ago - McAlister's Deli a sizable one that comes to mind rather immediately.

I have zero problem with this if the business thinks its a smart decision for them. It's a bit less than optimal for the consumer, who now no longer has the option of rewarding superb service unless they choose to pay "off the record" above what is now built into the menu price. As someone else earlier noted, tipping isn't going to stop.

The response of the consumer won't be known for a time, because almost certainly the restaurant owners won't uniformly bump prices across their menu. Some items will go up more than others, and the net effect on demand will only be known after the new menus have been implemented a while. Psychologically, higher menu item prices may instinctively cause people to order less, at least for a time, even if they know they don't need to consider a tip into the bill when the meal is concluded.

The only remaining issue for me is whether the mathematics works out. I'm no business or restaurant expert, but from what I understand the cost of a menu item at an average restaurant gets divvied up roughly into thirds: one-third food cost, one-third labor, one-third overhead. If average hourly labor is going up from $8 to $15/hour, that's an 88% increase in labor cost, but a 15% bump in menu prices means a $15 item that contributes $5 to labor now contributes $5.75. I don't see how you cover that 88% increase in labor costs with only a 15% increase in menu prices.

I realize the real-world pricing model isn't that simplistic, and I realize a lot of places aren't paying $8, and they're not all going to $15/hour. But that general model shows to my naive eyes that this first step is far from the end of the road on how these price/wage changes work out.

When we were in Paris (no tips allowed), the service was *way* beyond any service we've had at any but the best/priciest restaurants here in the USA, and we ate at places that ranged from cheap to expensive.

Do you think the culture of never having tipping has effected this behavior though? Changing from tipping being the norm to no tipping could have different results maybe?

Just saw this episode of Adam Ruins Everything dealing with the idea of tipping. I thought it was an interesting take on the subject.
a3QanmsNX-A

This might be the libertarian in me, but I don't like the idea of a restaurant owner telling me I can't tip their employees for good service, even if the tipping is no longer out of obligation. Having a "no tip" policy essentially does that. I bagged groceries at Albertsons in high school, which had a "no tip" policy--we were specifically told not to accept tips, and people would actually get in trouble; if one of the parking lot surveillance cameras caught someone doing so, they would be reprimanded.


Additionally, the food and drink costs increase, in this case by 15%.

Over the course of a meal for a family, that total increase may be more than what you usually tip (even if you tip "generously"), making the total cost of the meal more expensive.
If meal prices are only increasing by about 15%, but that increase is more than what you usually tip, you are not a generous tipper. That's the thing about percentages--they stay the same and it's amount of the tip itself that proportionately increases when applied to increasing bills.

The only remaining issue for me is whether the mathematics works out. I'm no business or restaurant expert, but from what I understand the cost of a menu item at an average restaurant gets divvied up roughly into thirds: one-third food cost, one-third labor, one-third overhead. If average hourly labor is going up from $8 to $15/hour, that's an 88% increase in labor cost, but a 15% bump in menu prices means a $15 item that contributes $5 to labor now contributes $5.75. I don't see how you cover that 88% increase in labor costs with only a 15% increase in menu prices.

Because the waiter isn't serving just one $5 item an hour. They're hopefully working multiple tables, with multiple folks per table, and at lunch turning them at least once in an hour. So lets say you are working 3/4 tables, with an average of 3 folks each (some two tops, some 4 tops). Turn them once during the hour, you're talking 18-24 people, spending say $10 each. A 10% increase in prices, if necessary, is $18-24 additional dollars. Dinner you'll have less turns per hour, but the average ticket will be higher, especially if you sell alcohol, so you may be looking at no turn per hour, but at average ticket of $20, so it works out the same. It could potentially work out well for everyone but the waiter. The customer is paying a little more, but less than they might tip. The restaurant is now paying an additional $13 an hour, but is actually making more than that per hour over what they were making. For the waiter, the single advantage is consistency in pay. But now everything they make gets taxed (yeah, I know, technically they were supposed to pay taxes on all their tips but lets be honest).

It's also a lifestyle change for the wait staff. Most wait staff I know have gotten used to daily income. When I have seen them switch to jobs that pay weekly or bi weekly, I see them have budgeting issues.

The big thing that would be a bonus as a waiter for me, from personal experience, is that late night, comes in right before closing group, that hangs out for two hours, and then leaves a small tip. It would bug me less having to stay late if I knew I was guaranteed $15 an hour for staying late for a single table.

I think it has all to do with that, the fact that America keeps the tipping legal (letting owners not pay their employees), is the reason it keeps happening.

You do your job well because you don't want to be fired. The incentive should not be an optional gratuity from random strangers who come in through the door. Restaurant owners should be ashamed of the entire system.

If you are paying servers $12+ an hour and they suck, they will be fired. Just like anyone else doing any other job ever. Honestly I think the tipping system in America is embarrassing, and people getting mad at tourists from other countries not knowing how to tip, should focus that energy towards changing the system here.

Do you think the culture of never having tipping has effected this behavior though? Changing from tipping being the norm to no tipping could have different results maybe?

Yes, absolutely, I suspect that since "no tipping" has been the norm in Europe for decades, it's been ingrained in everybody's daily life. If "no tipping" starts now, it will take a couple of generations for things to get like Europe.

It's kind of like single-payer health insurance - since Europe has had it for decades, it works there, but if we tried to implement it here and get rid of our current system, it would take decades for us to get it working right (if it ever could be done, but that's a whole other thread).

The tipping thing seems to me to be split between 2 factions - low/mid-range restaurants and high-end. I'd imagine low/mid places would be better for a no-tipping policy than high-end. A server at Ludivine probably makes an insane amount of money per hour w/tips, and has more incentive to be good just because of the environment, and has probably spent time in the low/mid restaurants before going to Ludivine. A server at Joe's Crab Shack might be glad to get a stable wage since the tips they make aren't as much or consistent as at places like Ludivine, but not really sure how it will all work out (I've worked in restaurants before, but never as a server, my personality wouldn't be a good match :) ).

When we ate at Antoine's, Tujague's, Arnaud's, etc. in NOLA, *tons* of the wait staff there were lifers, been with the restaurant for decades, but those places are higher-end and therefore tips are more $$$ there. Some cities/countries/restaurants do have a "server" culture where people like the job, like the pay, and will do it forever, and other places/restaurants see a server as an interchangeable position that anybody can hold, if someone leaves, just hire someone else, plug-and-play, as it were.... Lots of factors at play here.

Do you think the culture of never having tipping has effected this behavior though? Changing from tipping being the norm to no tipping could have different results maybe?

In college towns the no tip behavior is not uncommon.

Because the waiter isn't serving just one $5 item an hour. They're hopefully working multiple tables, with multiple folks per table, and at lunch turning them at least once in an hour. So lets say you are working 3/4 tables, with an average of 3 folks each (some two tops, some 4 tops). Turn them once during the hour, you're talking 18-24 people, spending say $10 each. A 10% increase in prices, if necessary, is $18-24 additional dollars. Dinner you'll have less turns per hour, but the average ticket will be higher, especially if you sell alcohol, so you may be looking at no turn per hour, but at average ticket of $20, so it works out the same. It could potentially work out well for everyone but the waiter. The customer is paying a little more, but less than they might tip. The restaurant is now paying an additional $13 an hour, but is actually making more than that per hour over what they were making. For the waiter, the single advantage is consistency in pay. But now everything they make gets taxed (yeah, I know, technically they were supposed to pay taxes on all their tips but lets be honest).

This sounds good in theory, but it's far from reality and here are the reasons why:

1. In a majority of restaurants, host and bus staff (and bar staff as well, but they do make their own tips) all get paid under minimum wage (usually more than $2.13) and the restaurant makes up the difference by charging the servers 3% to 5% of their sales to make up for the difference. So if a server sells $1000, they are "tipping-out" $30 to $50 to other staff.

2. Staff doesn't immediately come in and start waiting on guests and immediately leave when the last guest leaves. Most places have servers coming in at least 30 minutes before open, not getting their first table for 30 minutes to an hour after that, and staying for at least 30 minutes after the last table leaves. A typical dinner shift might look like this:

4:00 - Server Clocks in
4:30 - Restaurant opens
5:00 - +1 Table
6:00 - +1 Table
6:30 - +1 Table
7:00 - +2 Tables
7:30 - +2 Tables
8:00 - +2 Tables
8:30 - +1 Table
9:30 - Tables gone
10:30 - Server clocks-out

6.5 hours @ $13/hour increase is $84.5 and consider other staff as well, we'll say $100 of increased labor.

10 Tables would need to cover as much as $100 in labor costs. So if the PPA of the restaurant has been $20/person @ 3 covers per table, That's $600 in sales. That represents a need for 16.7% price increase to cover the increased labor. There will be busier nights than described above, and there will be slower nights.

Unquestionably the long-term effect of this is less front of house staff per guest in the restaurant. That means slower service times – not necessarily inattentive service, but if instead of putting an order in so the kitchen can start it, the server has to grab drinks for 3 tables, that means the guest can't get in and out to make it to their movie, or get back to the baby-sitter.

Yes, absolutely, I suspect that since "no tipping" has been the norm in Europe for decades, it's been ingrained in everybody's daily life. If "no tipping" starts now, it will take a couple of generations for things to get like Europe.

Generally, you are probably right about "Europe", but you do tip in Great Britain and the Republic of Ireland (Northern Ireland is part of Great Britain). You don't tip in pubs/bars, but you do in restaurants. You also tip in Amsterdam.
C. T.

I never waited tables where I ran less than 3-4 tables. And that was at a very upscale place. The Mexican restaurant I wanted at, I'd be running 5/6 tops minimum.

The exact math may have variables, but the point is, it should work out without a significant price increase.

On a side note, I've never worked at a place where I had to stay after the last table left. Once my area was empty, I was out of there. That's why we hated the late night hangers (which is one area where the company will lose out unless they're buying drinks).

Generally, you are probably right about "Europe", but you do tip in Great Britain and the Republic of Ireland (Northern Ireland is part of Great Britain). You don't tip in pubs/bars, but you do in restaurants. You also tip in Amsterdam.
C. T.

What if the pub serves grub?

I know a bartender in Edmond pretty well and I asked her last week about a raise to $15.00 per hour and no tips and she said she couldn't afford the cut in pay. She currently makes $3.15 plus tips.
C. T.

I know a bartender in Edmond pretty well and I asked her last week about a raise to $15.00 per hour and no tips and she said she couldn't afford the cut in pay. She currently makes $3.15 plus tips.
C. T.

I have a close friend who is a bartender, at a place that does coin beer night. She left a full time office management job where she made $15 an hour to return to bartending. She works about 15 hours a week and makes the same money she made in the office management job. The big night is the coin beer night, since every time someone gets a beer, they tend to tip a dollar. She typically makes about $400 in that 6 hour shift.

Because the waiter isn't serving just one $5 item an hour. They're hopefully working multiple tables, with multiple folks per table, and at lunch turning them at least once in an hour. So lets say you are working 3/4 tables, with an average of 3 folks each (some two tops, some 4 tops). Turn them once during the hour, you're talking 18-24 people, spending say $10 each. A 10% increase in prices, if necessary, is $18-24 additional dollars. Dinner you'll have less turns per hour, but the average ticket will be higher, especially if you sell alcohol, so you may be looking at no turn per hour, but at average ticket of $20, so it works out the same. It could potentially work out well for everyone but the waiter. The customer is paying a little more, but less than they might tip. The restaurant is now paying an additional $13 an hour, but is actually making more than that per hour over what they were making. For the waiter, the single advantage is consistency in pay. But now everything they make gets taxed (yeah, I know, technically they were supposed to pay taxes on all their tips but lets be honest).



A percentage increase is a percentage increase no matter the hourly density. If we assume that sales (quantity demanded) doesn't change (which I think is a false assumption, but we'll set that aside) you're selling the same number of dinners you sold before, so the hourly density is irrelevant. The gross revenue goes up by whatever percentage you've increased prices.

What if the pub serves grub?

JerryWall,
Makes no difference, no tips. I should have mentioned that in my comment.
C. T.

A percentage increase is a percentage increase no matter the hourly density. If we assume that sales (quantity demanded) doesn't change (which I think is a false assumption, but we'll set that aside) you're selling the same number of dinners you sold before, so the hourly density is irrelevant. The gross revenue goes up by whatever percentage you've increased prices.

I don't get what you're saying here (or if you're disagreeing). I agree the gross revenue goes up by whatever percentage you've increased prices. But you questioned how one $15 item would cover the increased labor costs. My answer was that it wouldn't. But your total sales for that hour should. If a waiter isn't serving at least $100 an hour, you've got too many on the floor. Even when I was a shift manager at McDonald's (20+ years ago) we had a rule of one person per $50 in sales.

JerryWall,
Makes no difference, no tips. I should have mentioned that in my comment.
C. T.

Just curious. I think I'd be totally confused.

I don't get what you're saying here (or if you're disagreeing). I agree the gross revenue goes up by whatever percentage you've increased prices. But you questioned how one $15 item would cover the increased labor costs. My answer was that it wouldn't. But your total sales for that hour should. If a waiter isn't serving at least $100 an hour, you've got too many on the floor. Even when I was a shift manager at McDonald's (20+ years ago) we had a rule of one person per $50 in sales.

I'm just saying that I disagree on the idea that how many you sell an hour makes any difference before and after a price change. All that matters at the end of the day is the total. That's the amount I can put in the bank. Assuming no change in demand despite a price increase, if I sell 100 dinners start to finish, it doesn't matter when I sold them, or if I sold 20 at 5pm or 40 at 6pm.

Put a different way, if I sell the same number on Thursday when the price was $10 as I do on Friday when I increased the price by 10% to $11, my gross revenue is only up 10% no matter how many I might have sold in a given hour. That 10% revenue increase has to cover that 70-80% increase in labor costs (from $7-8/hr to $14-15). Maybe it does/will. On the surface, to my non-business/non-restaurant brain, it seems unlikely.

Just curious. I think I'd be totally confused.

JerryWall,
I forgot to mention, it is perfectly acceptable to buy the bartender a drink after having a few drinks yourself. So I guess that's sort of a tip, but say I had five pints, that's about £15 so his tip would be £3 and that's 20 percent, but it's not something you do every time you visit the pub. Also, you go to the bar to order your food and the chef/cook brings it to you at the bar or to your table. You are still getting your own drinks at the bar, there is no real wait staff. By the way, what's confusing?
C. T.

JerryWall,
I forgot to mention, it is perfectly acceptable to buy the bartender a drink after having a few drinks yourself. So I guess that's sort of a tip, but say I had five pints, that's about £15 so his tip would be £3 and that's 20 percent, but it's not something you do every time you visit the pub. Also, you go to the bar to order your food and the chef/cook brings it to you at the bar or to your table. You are still getting your own drinks at the bar, there is no real wait staff. By the way, what's confusing?
C. T.

If I was traveling around, multiple countries, and in some places you tip, some you don't, some you tip at restaurants but not bars. I'd have to have a cheat sheet with me to keep track. :)

I'm just saying that I disagree on the idea that how many you sell an hour makes any difference before and after a price change. All that matters at the end of the day is the total. That's the amount I can put in the bank. Assuming no change in demand despite a price increase, if I sell 100 dinners start to finish, it doesn't matter when I sold them, or if I sold 20 at 5pm or 40 at 6pm.

Put a different way, if I sell the same number on Thursday when the price was $10 as I do on Friday when I increased the price by 10% to $11, my gross revenue is only up 10% no matter how many I might have sold in a given hour. That 10% revenue increase has to cover that 70-80% increase in labor costs (from $7-8/hr to $14-15). Maybe it does/will. On the surface, to my non-business/non-restaurant brain, it seems unlikely.

It may not work for every business, but Joes Crab Shack surely has done the math and have figured out how to make it work for them, at least. According to one article, Joes is going to increase menu prices by 12-15%. I heard of other places that just do a 15-20% service charge on the ticket, with no tipping, and pay good wages to the staff. GIRARD (http://www.girardongirard.com/#menutop) as an example. And they give full health benefits, paid sick days, and vacations (something most wait staff don't get).

I never waited tables where I ran less than 3-4 tables. And that was at a very upscale place. The Mexican restaurant I wanted at, I'd be running 5/6 tops minimum.

The exact math may have variables, but the point is, it should work out without a significant price increase.

On a side note, I've never worked at a place where I had to stay after the last table left. Once my area was empty, I was out of there. That's why we hated the late night hangers (which is one area where the company will lose out unless they're buying drinks).

How long has it been since you've been in the business?

I've never worked a restaurant where a server didn't have closing duties to do (which could potentially be done while the last table is in, but sometimes it doesn't work out like that). Plus you have to run your check out, plus you have to wait around for 3 or 4 people who are ahead of you. Leaving within 5 minutes of the last table leaving has been less than 20% of my shifts over the last 10 years. Much more common to leave around 20 minutes, 30 minutes later.

And that's to say nothing of the reality that servers will milk the clock if they're wage-based. I'm sure it won't be any more than another job, but it will happen, especially given the demographics of your average entry-level server.

And you can have a 10 table section, but if the restaurant doesn't have the people coming in, you're not going to be waiting on that many. The point is, as a server, you're not bringing money into the restaurant during 100% of your shift, and you would also no longer be subsidizing other staff.

It has been a while. We didn't have closing duties when I waited, but certainly things could have changed. As for milking the clock? Sure, but I think those people won't last long. More and more restaurants are switching to this model, so it must be working for some of them. Joes will be the first nation wide test. We'll see.

It has been a while. We didn't have closing duties when I waited, but certainly things could have changed. As for milking the clock? Sure, but I think those people won't last long. More and more restaurants are switching to this model, so it must be working for some of them. Joes will be the first nation wide test. We'll see.

The model is obviously tenable as restaurants domestic and international do well without the tipping policy.

The question isn't whether or not it will work. The question is what has to be given up in order for this new situation to work. The advantages seem pretty straight forward. But I do wonder if people are acknowledging the potential disadvantages, especially because the average customer is likely to save money in the new system.

Agreed, which was actually part of the point of my initial post. I think carhops at Sonic would be happier, but not a waiter at the Petroleum Club.

I know servers/bartenders at a few places who make $75K and more annually. That's $36/hr. Neither they nor their employers could handle the pay cut. You think there is a server shortage now? Just wait.

Oh, and if I get the same rate no matter what, please schedule me ONLY Mon-Fri 9-5, and I'll be taking lunch from noon to one. What? You want me to work high-volume times FOR THE SAME MONEY??!? Pass. I'll go work somewhere less busy. They're all hiring, because they can't get anyone now that wages are fixed (and still low relative to other businesses).

Wait...what did you say? You want me to suggestively sell to gently raise your per-ticket? BWAHAHAHAHA!!! Yeah, Youre right...I used to do that, back when I higher ticket meant my wage was correspondingly elevated, but eff THAT. Heck, I'll probably sell 'em on the cheap stuff and talk them into water to drink, because you had the nerve earlier to ask me to clean something. That's not even my job!

I know servers/bartenders at a few places who make $75K and more annually. That's $36/hr. Neither they nor their employers could handle the pay cut. You think there is a server shortage now? Just wait.

Oh, and if I get the same rate no matter what, please schedule me ONLY Mon-Fri 9-5, and I'll be taking lunch from noon to one. What? You want me to work high-volume times FOR THE SAME MONEY??!? Pass. I'll go work somewhere less busy. They're all hiring, because they can't get anyone now that wages are fixed (and still low relative to other businesses).

Wait...what did you say? You want me to suggestively sell to gently raise your per-ticket? BWAHAHAHAHA!!! Yeah, Youre right...I used to do that, back when I higher ticket meant my wage was correspondingly elevated, but eff THAT. Heck, I'll probably sell 'em on the cheap stuff and talk them into water to drink, because you had the nerve earlier to ask me to clean something. That's not even my job!

::hugs you::

#thingsithinkbutneversay

I know servers/bartenders at a few places who make $75K and more annually. That's $36/hr. Neither they nor their employers could handle the pay cut. You think there is a server shortage now? Just wait.

Oh, and if I get the same rate no matter what, please schedule me ONLY Mon-Fri 9-5, and I'll be taking lunch from noon to one. What? You want me to work high-volume times FOR THE SAME MONEY??!? Pass. I'll go work somewhere less busy. They're all hiring, because they can't get anyone now that wages are fixed (and still low relative to other businesses).

Wait...what did you say? You want me to suggestively sell to gently raise your per-ticket? BWAHAHAHAHA!!! Yeah, Youre right...I used to do that, back when I higher ticket meant my wage was correspondingly elevated, but eff THAT. Heck, I'll probably sell 'em on the cheap stuff and talk them into water to drink, because you had the nerve earlier to ask me to clean something. That's not even my job!

Then the servers will probably just have to find another place that allows tipping, in another city or state, or change jobs. Happens all the time to millions of people when their jobs change - energy employees, newspaper copy editors, mainframe systems administrators, gas lamplighters, horseshoers, etc.

It's. Never. Going. To. Happen.

It's. Never. Going. To. Happen.

what do you mean? Industry wide tip elimination?

It would push the good servers out of the industry and encourage the bad waiters to stay around in the industry.

^^^^^^
Exactly. If Chili's and Joe's Crab Shack, et al. want to do it, fine. But if I'm dropping decent coin on a steak or other quality meal I'd prefer to tip well and receive attentive, knowledgeable service from someone who is highly incentivized to provide it, instead of a disinterested order-taker who's making an OK-but-not great living and wishing they were doing something else.

I know many, many people - servers, owners and patrons - who feel this way.

So none of you think that the higher-end places would pay more (maybe not as much as the servers are currently making per hour with tips) to keep better servers if tipping started to go away? How do they retain good waitstaff in most of Europe where you don't tip, I wonder - higher menu prices to pay servers higher wages or something else I can't think of?

So none of you think that the higher-end places would pay more (maybe not as much as the servers are currently making per hour with tips) to keep better servers if tipping started to go away? How do they retain good waitstaff in most of Europe where you don't tip, I wonder - higher menu prices to pay servers higher wages or something else I can't think of?

Exactly. Places like Chili's would probably pay something like $10-$15 to start but Vast would pay $30+. It would be the same as working for a company as an entry level position and then based on experience and qualifications you would build a growing resume to finally be able to work at Vast. You are not going to work there as your first job, at least not as a waiter. The level of service, experience, and professionalism between the two are night and day, and the amount of tips you make shouldn't determine how well you do your job, it should be staying employed, I don't expect tips at my current job to go out of my way and provide excellent customer service, it is feeling a since of pride and wanting that paycheck.

But even then, some servers at Vast probably make more than $30 an hour.

These are, more or less, the various types of servers in the OKC high-end restaurant scene, how much they make, how much they work, and what percentage of the server-staff they occupy:

Server 1. Very well-established server with many long-standing call parties.
---Makes $70k+/year. Works ~35 hours per week, ~48 weeks/year. Effectively $42+/hour. 10% to 20% of server-staff.

Server 2. Tenured and established server with some call parties.
---Makes $52.5k. Works ~30 hours per week, ~46 weeks/year. Effectively $38/hour. 25% to 35% of a staff.

Server 3. Tenured server, working part-time.
---Makes $25k to $40k/year. Works ~18 to ~24 hours a week, ~44 to ~46 weeks/year. ~$30/hour to $35/hour. 50% to 60% of staff.

Server 4. New server, working full-time
---Makes $40k to $45/year. Works ~30 hours per week. 46-48 weeks/year. ~$25/hour to $32/hour. 5% to 10% of staff.

========

So, the problem with the wage-based is that there is really is no chance restaurants are going to pay Server 1s $35/hour to work only 35 hours in a week and not have any real responsibility except to wait tables. It's just not gonna happen, especially going from $2.13/hour and no vacation pay to a high wage and 4-weeks plus of paid vacation. (On top of the fact that employers will know servers are still getting money under the table, because rich people simply won't play by the rules). Server 4s, however, would be flocking like crazy from their previous $25/hour casual dining gigs that now only pay $15/hour. These types of servers usually take months and months and lots of training to figure out how to effectively serve at a high-level, regardless of how good they were at their previous gig.

For Servers 2 and 3, who work 3 quarters of an average work week or less, make over the median household hourly rate, and make up the vast majority of servers in the restaurant, it won't be worth it any longer. It's Servers 2 and 3 that you will lose in droves if upscale dining were to turn wage based. Why? Because all the flexibility and/or upside is gone. In a wage based system, it quickly becomes about working your way up the ladder, which is exactly what most servers are trying to avoid. (In fact, a large number of servers in upscale restaurants literally laugh at the idea of entering management…it's generally seen as a step down and is almost always a big pay-cut). Most of these people are educated and/or intelligent individuals who for one reason or another are not in the corporate world, but they absolutely could be if they wanted to, and for the right price they would. That right price takes a sharp decrease if the restaurant move to a wage, because instead of having a shot at $55k - $60k/year with relatively little effort and responsibility, you now have a manager breathing down your neck because you're a significant labor cost and the amount of work it will take you to move up and get a better wage becomes incredibly taxing and political.

At that point, Servers 2 and 3 enter the corporate world where the upside in pay is much higher and in a field that is more stable in both the short and long run. In fact, a lot of Servers 2 and 3 are either in transition or delaying a jump into the corporate world.

Exactly. Places like Chili's would probably pay something like $10-$15 to start but Vast would pay $30+. It would be the same as working for a company as an entry level position and then based on experience and qualifications you would build a growing resume to finally be able to work at Vast. You are not going to work there as your first job, at least not as a waiter. The level of service, experience, and professionalism between the two are night and day, and the amount of tips you make shouldn't determine how well you do your job, it should be staying employed, I don't expect tips at my current job to go out of my way and provide excellent customer service, it is feeling a since of pride and wanting that paycheck.

But right now, Chili's and Vast pay their servers the same amount of money. The extrapolation isn't exactly the same as Chili's probably runs more servers and is probably working on a lower margin, but I don't think Vast paying 66% of a staff 200% more of a wage is likely to work as well on the math side of it.

All the math hurts my head. Two things to consider also which has partially been mentioned. The wait staff generally has to tip out the the bartender, host, and busser which is generally 2-3% of sales. I am assuming they won't do this if straight hourly. The other consideration is I didn't know one server that actually reported all of the tips he received during his/her shift for tax purposes whereas with straight hourly, they will be taking all of the correct taxes out. Most of the servers I knew reported the credit card tips(traceable) and a small percentage of the cash tips.

All the math hurts my head. Two things to consider also which has partially been mentioned. The wait staff generally has to tip out the the bartender, host, and busser which is generally 2-3% of sales. I am assuming they won't do this if straight hourly. The other consideration is I didn't know one server that actually reported all of the tips he received during his/her shift for tax purposes whereas with straight hourly, they will be taking all of the correct taxes out. Most of the servers I knew reported the credit card tips(traceable) and a small percentage of the cash tips.

You're right, and the benefit of tax free income is a major perk to the restaurant industry. The government has long looked the other way on this, and switching to flat wages will take away that benefit and further erode the quality of server who will stick around.

Even average servers who make $15 an hour in cash tips won't stick around long for $15 of taxable income and take home $9

You're right, and the benefit of tax free income is a major perk to the restaurant industry. The government has long looked the other way on this, and switching to flat wages will take away that benefit and further erode the quality of server who will stick around.

Even average servers who make $15 an hour in cash tips won't stick around long for $15 of taxable income and take home $9

Are you saying tips are not taxed?