Tipping is this fair ?

[Jon81uk]

1. The waiters at these restaurants do not individually decide to call attention to this....it is policy....and if it were not, every waiter would go home with about five cents in their pocket at the end of the night. Foreign tourists do NOT tip. As a matter of fact, after 9PM, every table is charged with an automatic tip, regardless of size. And believe me, if not, every waiter would go home with nothing whatsoever.

Well the other option is the restaurant could pay a decent wage to start with and therefore staff wouldn't need to rely on tips. Or the restaurant makes it clear on the menu that a flat 12.5% or 15% is added to all checks unless a manager is called over.

 

[Hockey89]

Well the other option is the restaurant could pay a decent wage to start with and therefore staff wouldn't need to rely on tips. Or the restaurant makes it clear on the menu that a flat 12.5% or 15% is added to all checks unless a manager is called over.

Yeah, they can and the price of meals will increase 15-35%. so be careful what you wish for... Do you know what the margins are on a typical restaurant? Not per se but a normal place? Not much at all... If they increased the pay it has to come from somewhere or they will be out of biz. Seattle is already getting hammered because of this... I could post article after article....

 

[Jon81uk]

Yeah, they can and the price of meals will increase 15-35%. so be careful what you wish for... Do you know what the margins are on a typical restaurant? Not per se but a normal place? Not much at all... If they increased the pay it has to come from somewhere or they will be out of biz. Seattle is already getting hammered because of this... I could post article after article....

Well a 15-20% increase in the cost of the meal is the normal tip cost anyway.

And it seems to work in the UK pretty well. Over here there is not often an obligation to tip, but most people give 10% if the service is great.

 

[s8film40]

Well the other option is the restaurant could pay a decent wage to start with and therefore staff wouldn't need to rely on tips. Or the restaurant makes it clear on the menu that a flat 12.5% or 15% is added to all checks unless a manager is called over.

Well a 15-20% increase in the cost of the meal is the normal tip cost anyway.

And it seems to work in the UK pretty well. Over here there is not often an obligation to tip, but most people give 10% if the service is great.

There really isn't much of a demand for restaurants charging more for food and not requiring a tip here. It's a great idea, but most people wouldn't initially understand whats going on and in the highly competitive restaurant business people would look at the menu prices and just move on to a different resturaunt. Different countries just have different customs. How well do you think it would go over if I moved to the UK and opened a resturaunt charged less for food, paid my employee's $5 an hour and expected them to make up the difference in tips?

 

[Jon81uk]

There really isn't much of a demand for restaurants charging more for food and not requiring a tip here. It's a great idea, but most people wouldn't initially understand whats going on and in the highly competitive restaurant business people would look at the menu prices and just move on to a different resturaunt. Different countries just have different customs. How well do you think it would go over if I moved to the UK and opened a resturaunt charged less for food, paid my employee's $5 an hour and expected them to make up the difference in tips?

Over here the minimum wage is £6.50 ($9.30) and increases to £7.20 ($10.32) in April. So couldn't do that plan anyway, its also illegal for any restaurant to use tips to make ensure wages are at the minimum, tips must be paid on top of minimum wage. However in London a service charge is getting more common, mainly in places that are very expensive to start with.
Whereas in Florida minimum wage is $8.05 or $5.03 for tipped positions, so Brits are earning more in general.

 

[Lucky]

http://money.cnn.com/2015/10/14/pf/no-tipping-union-square-hospitality-group-restaurants/index.html

 

[s8film40]

Over here the minimum wage is £6.50 ($9.30) and increases to £7.20 ($10.32) in April. So couldn't do that plan anyway, its also illegal for any restaurant to use tips to make ensure wages are at the minimum, tips must be paid on top of minimum wage. However in London a service charge is getting more common, mainly in places that are very expensive to start with.
Whereas in Florida minimum wage is $8.05 or $5.03 for tipped positions, so Brits are earning more in general.

So in other words US customs wouldn't be tolerated in the UK. That's what I thought, and my point is people shouldn't expect their countries customs to be acceptable here.

 

[jaklgreen]

Well a 15-20% increase in the cost of the meal is the normal tip cost anyway.

And it seems to work in the UK pretty well. Over here there is not often an obligation to tip, but most people give 10% if the service is great.

Actually it would cost the consumer more if the cost of the food went up by 20% instead of just tipping 20%. You will be taxed on that extra amount, and in my city there is another "food tax" of another 2% on top of the city tax for restaurants. So it is much cheaper just to tip that money then be charged for it, especially at higher end more expensive restaurants. I don't understand the mentality of not tipping. You don't want to tip but would be fine with paying the extra 20% if they just added it in there? Why don't you just consider the tip that extra fee and tip instead of making a big deal out of it. Now you do not even have to do math to figure out what the tip should be since most places print it on the receipt. Plus the minimum wage for servers in my state is $2.13.

 

[Jon81uk]

http://money.cnn.com/2015/10/14/pf/no-tipping-union-square-hospitality-group-restaurants/index.html

I read this a very long time ago as well http://jayporter.com/dispatches/observations-from-a-tipless-restaurant-part-1-overview/

 

[Lucky]

Servers' wages are just one of many costs in operating a restaurant. There's no reason to think menu prices would all go up by X% just because servers' wages go up by X%.

 

[jaklgreen]

Servers' wages are just one of many costs in operating a restaurant. There's no reason to think menu prices would all go up by X% just because servers' wages go up by X%.

Yes they would. The owner is not going to take the hit on that. I work in a restaurant(fast casual that does not get tipped) and when minimum wage goes up then so do the prices, every time. In my state the minimum wage for a tipped server is $2.13 and min wage is now $9/hour. You don't think that if all of a sudden a restaurant had to pay their employees and extra $7/hour that they would not pass that along by raising prices.

 

[Lucky]

Yes they would. The owner is not going to take the hit on that. I work in a restaurant(fast casual that does not get tipped) and when minimum wage goes up then so do the prices, every time. In my state the minimum wage for a tipped server is $2.13 and min wage is now $9/hour. You don't think that if all of a sudden a restaurant had to pay their employees and extra $7/hour that they would not pass that along by raising prices.

You said in your previous post that menu prices would go up by 20%. If so, profits would go way up because servers' wages are just one cost of operating a restaurant. Or do you think rent, energy, food suppliers etc. would all somehow go up by 20% too?

 

[jaklgreen]

You said in your previous post that menu prices would go up by 20%. If so, profits would go way up because servers' wages are just one cost of operating a restaurant. Or do you think rent, energy, food suppliers etc. would all somehow go up by 20% too?

Your thinking rationally as a consumer not as a business owner. They will take that opportunity to raise prices 20% saying it is to cover the "tips" if tipping was done away with. Because it sounds reasonable to the public. Most people have not worked in a restaurant and would not know the percentage of labor compared to food cost, over head etc. They just know that they tipped a certain percentage and now that amount is just automatically added and most would be ok with that. I don't doubt for 1 second that most business owners would increase prices or have a service charge of 15-20% added if tipping was done away with and they had to pay minimum wage to tipped servers. Especially in a state like I live in where the gap is so big between tipped and regular min wage.

 

[s8film40]

You said in your previous post that menu prices would go up by 20%. If so, profits would go way up because servers' wages are just one cost of operating a restaurant. Or do you think rent, energy, food suppliers etc. would all somehow go up by 20% too?

I'm not sure I'm following your logic. If you normally pay your server 20%, and we're assuming the restaurant and the server will still make the same money but you don't raise the prices by 20% this means your paying less than you did before. So where is the extra money coming from to pay the server?

 

[Lucky]

I'm not sure I'm following your logic. If you normally pay your server 20%, and we're assuming the restaurant and the server will still make the same money but you don't raise the prices by 20% this means your paying less than you did before. So where is the extra money coming from to pay the server?

If only one of your (many) costs goes up by 20% you don't need to raise revenues by 20% to be back at whatever your profit margin was.

 

[s8film40]

If only one of your (many) costs goes up by 20% you don't need to raise revenues by 20% to be back at whatever your profit margin was.

But your cost that is going up is calculated at 20% of your revenue. I think you need to check your math. Apparently the magic equation your using creates money out of thin air.

 

[jaklgreen]

If only one of your (many) costs goes up by 20% you don't need to raise revenues by 20% to be back at whatever your profit margin was.

The restaurants costs will not go up to 20%. It all depends on how much business they get and how much staff they have on hand. In my state where it would go from $2.13 to $9/hour that would mean an increase of about 322% in labor. Chances are there would be fewer staff on hand because they will not want to pay that much more in labor. You have to look at the whole picture. It would be around the same amount of money for the consumer to pay out but it is a big increase to the employer in states where the gap is so big. In theory getting rid of tipping is a good one but there would have to be some major overhauls in laws and regulations in order for that to happen in this country. I would hate to see people loose their jobs because it costs too much to keep them on staff. And you know the owners is not going to take less of a profit to keep people.

 

[Lucky]

But your cost that is going up is calculated at 20% of your revenue.

I thought you meant servers' wages paid by the employer would go up by 20%. That clarification helps. In that case, most of it would get passed on in higher prices to customers.

The restaurants experimenting with no tipping don't seem to be necessarily aiming for completely preserving servers' current incomes. One goal seems to be to equalize wages more relative to their non-tipped employees. And a lot of servers wouldn't mind making a little less if it eliminated the uncertainty of the tipping system, where sometimes you work hard to serve a customer and get nothing.

 

[HRHPrincessAriel]

Two things.

1. The waiters at these restaurants do not individually decide to call attention to this....it is policy....and if it were not, every waiter would go home with about five cents in their pocket at the end of the night. Foreign tourists do NOT tip. As a matter of fact, after 9PM, every table is charged with an automatic tip, regardless of size. And believe me, if not, every waiter would go home with nothing whatsoever.

2. BBQ in New York - You could do worse - this place had been around for many years and offers very good food at low prices - http://www.dallasbbq.com/ (In full disclosure - I was a waiter there in my 20's, but I otherwise have nothing to do with them, except for being an occasional customer).

I'm still scratching my head at something called Dallas BBQ does have brisket! I'm also thinking if I've ever been to any BBQ place here in TX that has hot dogs ;-)

 

[s8film40]

I thought you meant servers' wages paid by the employer would go up by 20%. That clarification helps. In that case, most of it would get passed on in higher prices to customers.

The restaurants experimenting with no tipping don't seem to be necessarily aiming for completely preserving servers' current incomes. One goal seems to be to equalize wages more relative to their non-tipped employees. And a lot of servers wouldn't mind making a little less if it eliminated the uncertainty of the tipping system, where sometimes you work hard to serve a customer and get nothing.

Yeah, I'm assuming the servers don't want to get paid less. In a competitive market the restaurants experimenting with paying their servers less are just going to end up with the people who couldn't get a job at the other restaurants.