No-Tipping Restaurants Offer Food for Thought to Budget Travelers

Tip and receipt on table in restaurant
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There is a growing trend in the United States toward no-tipping restaurants.

What if more restaurants end the practice of tipping? The idea is not as far-fetched as many budget travelers might think. 

The American practice has developed over generations in ways that, from an ethical standpoint, are increasingly questioned.

Many restaurants pay their wait staff and bussers (table cleaners) less than minimum wage, and it's completely legal to do so.

The idea is that if workers are going to receive tips, the resulting income should be their primary compensation.

The restaurant offers these workers a platform to earn those tips. The small hourly wage is more of a supplement. Gratuities are added automatically only for larger parties (perhaps groups of six or more).Workers have signed up for this deal through the generations.

But this U.S. model has its faults. Diners are not required to tip, and there are nights when revenue from gratuities is lacking. Cooks and back-end restaurant workers don't receive tip revenue. These conditions can create a rather grumpy, even disenchanted staff. It sends a message that service, rather than food quality, is the main attraction.

The system also invites tax fraud. More than a few wait staff members are tempted to simply report the base hourly income on their w-2 forms and then under-report the gratuities.

Since many tips are paid in cash, there is opportunity for deception. 

 

The European Model

 

Most of Europe follows a different system. Staff is paid a higher wage, and that added cost is built into the prices on the menu. Diners are free to round up the check total to the next Euro or Pound, but they don't usually leave a larger amount unless the service was absolutely exceptional.

This model puts the onus on management to pay a responsible wage, and it makes the staff far less reliant on diner generosity. It also takes away a diner's opportunity to express appreciation or disdain.

Some diners contend this approach tends to decrease the incentive for servers to excel. But the other side of that argument focuses on the benefits of a uniform payroll.

Restaurant owners in the United States are beginning to pay attention to this no-tipping approach.

 

U.S. Business is Rethinking Restaurant Gratuities

 

NY Eater reports that a New York-based company decided to eliminate tipping in all 16 of its restaurants. Its owner is quoted in the story as saying "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.’"

The Washington Post quotes a restaurant owner who says he increased menu prices by 15 - 20 percent and then discouraged tipping so he could be the person responsible for assessing good service rather than his patrons. If diners choose to tip anyway, the money is given to a charity of the staff's choosing. His thought is that diners won't pay more than they did in the days of a total-plus-tip, even though the menu prices were lower.

A restaurant in Pittsburgh announces at the top of its menu that "We do not accept gratuity. Our kitchen and front of house teams are paid a salary. Our prices reflect this."

Zagat, the company that has built its reputation on reviewing restaurants, now provides information on no-tipping restaurants. One such story is titled 11 No-Tip Eateries in San Francisco.

 

Why Should Budget Travelers Care?

 

As this trend takes hold, it could have an impact on how you control budget travel dining costs. You'll need to weigh your interest in paying less for the food you order with your concern for the people who are preparing it and serving it. As you seek to avoid making common food mistakes during travel, you'll need to be certain your comparison shopping for restaurant experiences takes no-tipping policies under consideration.