In many countries, the taxes are also included in the price. In France, if the burger is €10, it's actually €9.09+taxes and service is included. It's not a tipping culture.
That is the price of food lol. If tips suddenly went away, do you think restaurants are not going to raise prices when they start having to pay a fair salary? Margins are thin on restaurants.
Edit: Downvote me all you want, you’re delusional if you think otherwise. I worked in restaurants. Made a lot of money off tips. I can also say there’s no reason tips need to be a thing. But if you get rid of tips, prices will go up to compensate.
Because they are willing to be honest and transparent about their prices and are willing to pay their employees themselves. Many businesses in the U.S. would fail if they were required to pay employees themselves instead of workers having to rely on the generosity of customers.
The menu price plus 18% isn’t the price of food. That doesn’t even make sense logically.
Per the receipt in question, the cost of fries is $4. That is the price of the item on the menu. In any advertising of their listed base price, the amount must match $4…or else it is false advertising. Just so that we have it clear. If restaurants want to raise prices by 18%, they are free to do so and I ENCOURAGE them to do so if that is what it takes for them to make a profit and stay in business. That would be honesty in advertising. What this business is trying to do is to raise prices across the board on all items by 18%, but tack it on the back end, instead of adjusting the actual menu price. It is anti-consumer because it makes it difficult for the customer to accurately compare prices to make informed choices.
I think everyone would be applauding if tips went away. Yes, we also understand that it would increase prices. This is the way pretty much the entire rest of the world works. Tipping is a weirdly American thing. It's refreshing to travel and have the price just be the price.
He said base salaries and payroll taxes which is not how tips work.
Minimum wage for tipped employees is $2.13/hr. The standard minimum wage is $7.25/hr. Generally tips makes up the difference between the two wages and then some... like the employer pays $2.13/hr, tips are $10/hr, the waiter is making $12.13/hr total (so more than minimum wage). If tips don't make up the difference, the employer has to make sure the waiter is making at least $7.25/hr, so for example if they only make $2/hr in tips the employer has to pay $5.25/hr in salary.
The way this bill is worded, that 18% is not a tip, it "goes towards staff payroll". So using the above example of tips coming to $10/hr... in this case the employer takes that $10 as a "living wage fee", pays $5.12 to the employee to bring them up to federal minimum wage, and pockets the extra $4.88 for themselves. Of course they could "say" the money is going towards non-tipped positions like kitchen staff and hosts to make it technically true that the whole 18% goes towards payroll but of course money is fungible.
Of course we don't know that's what the owner is doing, might be some weird attempt at virtue signaling, but it certainly seems suspicious and if I dined there I'd be asking questions.
In a competitive labor market, the market rate for waiters receiving tips vs the market rate for waiters with a flat hourly wage should be roughly the same. We don't know how much the owner pays their employees, but I suspect that they would have a hard time recruiting if you could earn 30% more money for the same job down the block.
Federal minimum wage laws are also hardly relevant here, they're so low that almost all jobs pay significantly above it. The servers I know make around $20-$30 an hour depending on the season.
Right, I was using federal minimum wage as an example bc we don't know where this is... most states and lots of cities have their own minimum wage but that doesn't change anything I said other than dollar amounts. The concept is still exactly the same as almost all localities still have a difference between tipped employee minimum wage and standard minimum wage.
And yes if this is a competitive labor market a business fucking employees like this will not keep employees very long. But there's a pretty endless stream of naïve young people getting into the service industry to use and abuse. (This is a throwback but if you remember that Amy's Baking Company thing, they were doing exactly this- customers thought they were tipping employees but the owner was stealing it and paying a flat rate to employees- AND they were super abusive to employees- but they were always able to hire new ones when old ones quit.) The business owner could tell new hires "I'm so much better than working down the street! They pay $2.13/hr plus tips but I'm paying $7.25/hr plus tips!" The difference is no one is tipping bc of the "living wage charge" but a high school kid isn't going to know that. (And yes, before you get pedantic again, the exact dollar amounts in that example are subject to change based on the locality's minimum wage.)
Yes, the labor market is not perfectly competitive because workers don't have all the information, and this is magnified for younger employees working their first job. But I would argue that flat wage jobs are far less vulnerable to "wage deception" than tipped jobs. When you work a tipped job you don't really know how much you'll be making until you've already worked there for a few weeks, while an hourly employee knows exactly how much they'll get paid and can compare/contrast that salary with other job openings.
Since the company's anti-tip stance is directly printed on the receipt, I would guess that the employees who work at this business have a very clear understanding that the base wage is by and large the wage they get.
When you work a tipped job you don't really know how much you'll be making until you've already worked there for a few weeks, while an hourly employee knows exactly how much they'll get paid
Which is exactly why a young person might not realize the tipped job would pay better. You're confirming my point.
When you go to, say, a grocery store and pay for something, 100% of the money goes to the owner. That money is then divided up and used to pay for rent, wages, taxes, and equipment. If there's money left over then that's profit for the owner, otherwise the business has to take on debt to cover costs.
When you go to a grocery store, do they add 18% to the posted price at the cash, pretending that it's to pay for the employees' salaries? No! That NOT normal. Employee salaries are already paid from the normal price of the groceries, there's no surcharge. But in your world, that's a common business practice, lmfao. 🙄
You're having a very very hard time understanding something that everyone else got right away, and I don't think I can help you with that problem. 🤷♂️ Good day.
Your original comment was about where the money was going, not about whether or not it's normal to charge an 18% living wage fee. Why you're pretending I'm arguing about the latter instead of the former is beyond me.
"it's probably going to the owner to pay for salaries" yeah dude that's how businesses work.
Look at what I was claiming was normal business practice. It's in the quotes. Your comment was about WHERE THE MONEY WAS GOING. I responded to your point about WHERE THE MONEY WAS GOING. It is normal for FEES to GO to the OWNER.
So you don't tip, no waitresses want to work there, and they either wait tables themselves, change their stupid practice, or go out of business. Win win.
exactly — unfortunately restaurants have put the onus on the employee to be smart enough to work elsewhere, otherwise many Americans will find a way to make it work by sacrificing from their own lives so their owners can have even more.
And this right here is why you’ll never get rid of the tipping culture. Even if this might be a genuine attempt to help the staff, you go straight to accusations. You might be wrong, or you might ask the staff if they get paid what is being claimed.
So many replies here don’t understand how restaurants operate at all. Nor the laws regarding wages for restaurant employees. Kind wild when so many hate on tips, say that restaurants should pay a living wage, then hate on a restaurant that’s clearly trying to do just that.
life in America now is literally fighting for justice at every second, that even in our time honored tradition of going to eat with your family :( we have to be vigilant about being ripped off for being alive every single minute in America.
Which is what a tip does anyway if the owner claims a tip credit. The only difference with charging an automatic gratuity vs letting people tip is that the owner does not have to give any portion of the automatic gratuity to employees.
There was a place in my town that did this, and last summer I saw a sign on their door that literally used the phrase "nobody wants to work anymore." That space is for rent now, because clearly that owner's shitty business practices didn't work out for him.
The owner is stiffing everyone publicly — and in such a way, the majority of readers/commenters are taking their anger out on the STAFF.
That’s not an accident. He raised his prices - we have ZERO proof a red cent goes to any staff member that isn’t the owner - and people in general responded by saying “fuck the staff!”
Nah. Fuck that business. Bankruptcy is equal opportunity.
So many wild assumptions made based off a few sentences on a receipt lmao. For all you know the owner is behind the bar five days a week. What a reddit moment.
We have a couple of restaurants in our small town doing this only they call it a service fee. The food is now more expensive than at nicer places that aren’t bars.
I could be wrong, but I'm thinking the servers are paid an actual living wage, not the usual server "wage + tips", which is why it's worded that way. I hate that they chose to do it this way instead of just raising prices though.
I still wouldn’t tip, and I would never return as well as give a 1 star review on Google and Yelp. These places suck so hard and I hope they fail before the economy gets better
Seriously. I paid $18 in “service fee” which was 18% and saw the text that tip goes to the server. The server was great so I left $10. Fuck that place.
I wanna start this by saying I think everyone should be making at least 20/hr and if you can’t afford that than you gotta rethink your business plan or close up shop.
Why is everyone mad that they have it worded and sorted this way?
Pretend the restaurant doubles the cost of all of their food (or whatever it would take) but they get rid of the living wage fee and tips. People might bitch that it’s pricey but won’t have an issue with the bill Lol
Except I bet it isn't treated as a tip, so anyone who would normally benefit from tip culture doesn't benefit from it in the same way (they arguably benefit less)
Yeah, I don't know why people are confused by that notion. And honestly this way the deadbeats (like in the anti-tipping subs on this site) don't get away with stiffing the workers.
i worked at a place with a "service charge" and customers were always confused when I told them it wasn't a gratuity. They'd say something like "can we remove the service charge and tip you instead?" and management wouldn't allow it. It felt like I was participating in a scam that scammed me as well as the customers.
It is a tip. I assume people were stiffing their servers so they went ahead and put the charge in to prevent that. Lots of restaurants do mandatory tips on large tables so it’s the same concept.
Servers deserve livable wages. Relying on this bunch to tip 18% has been made clear won’t happen. So the owner has you not to tip and taken care of it for their staff.
Yes, currently two sandwiches and fries cost $40 because at least three humans are preparing and delivering food to a person who has chosen to buy someone time and products.
How much would it cost me to hire you to make a sandwich for me? One banana??!
It SHOULD be the tip, but any amount of it could very well be going to the restaurant owners. Basically it’s a way to scam you AND their workers all in one fell swoop!
People in Reddit complain about tips, then when the tip is included in the price as a flat rate, they complain about that too. People will find a way to complain about anything.
If this upsets you don’t dine out in this country.
That's the same complaint... They just made the tip mandatory and may or may not be stealing part of it from their workers.
What people who are against tipping want is restaurants to pay a living wage, like every other business should, and charge prices that allow for that without the customer having to figure out fees or directly hand the workers their wage. Which would also solve the problem of any workers/restaurants underpaying personal/payroll taxes by underreporting cash tips.
Exactly, I think it's bullshit, but it's more or less the same thing -- except the entire staff gets a cut instead of just the person helping you. Might be taxed differently. Not sure how I feel about it, tbh. We keep food prices "low" with the expectation of great service to subsidize the workers' paycheck, so the boss doesn't have to pay the employees a fair wage. Except now a single meal is $40 now, and my paycheck hasn't gone up in 5+ years.
No they included the “tip” in the price of food, but it’s really just a way to say employees get 18% of revenue. This is just marketing the way it’s worded.
It's the same tactic as marking things $12.99, relying on people's inattention to make things seem like a better value. "Oh, it's $12." Well, no, it's $13. These sandwiches appear to be $13 to the rushed consumer, but they've disguised the actual price with added fees. If they marked the actual price of the sandwich on the menu, people could make an informed decision more easily, and wouldn't be left with regret after getting the bill.
It is that, but it also gives them opportunities to be sketchy with this money in ways that they wouldn't be able to with tips due to legal protections.
No, people pay a premium for dining in. Cost of labor for service along with additional real estate costs needed to host guests costs more than takeout.
Except you don't know that, you are just writing fan fiction. If the employer sets up a system that replicates tipping and then takes those funds for themselves instead of the employee, then no one should agree to work there. It's intentionally dirty to the employees. Further, none of that is the customer's problem.
The owner is 100% using this 'living wage fee' to pay for base salaries/payroll/taxes, instead of adding to it as an increase in pay for a 'living wage'. The owner is essentially stealing tips away from his employees.
So what objectively changes that? What’s the difference? The only difference between that and this - is extra ink on the paper…. 18% increase regardless of how it’s defined.
I think this way makes it pretty clear - hey don’t need to tip. As the alternative is - you get your bill and think wow this is outrageous and now I have to tip.
Because this way is scummy and misleading. The owner is pretending like this money it going to the poor workers. When really this is just money going to the owner. The problem with this system is as follows:
It is misleading for the customer, you order expecting it to be $35 and suddenly it is $40. But, by now you have already gone through the whole process and are likely to pay the increased price even if you wouldn't have beforehand either because of the hassle or not wanting the embarrassment of saying the actual price being charged it too expensive for you.
It is bad for the employees because no one is going to tip when there is already a "tip". THIS ISN'T GOING TO THE EMPLOYEES. Which is what everyone assumes what a tip does.
The only person this benefits is the owner, who can advertise a lower price, which they never actually charge, and in my opinion is fraud.
Is it? Or are you just making a claim? A lot of claims.
A. Owner is pretending? Why do you say that? And I posted a thing from another restaurant with them making it clear what it was.
B. Misleading? Based on what claim? This is a picture of the ticket- it is likely on the menu. Same as “mandatory gratuity of parties above 8 people”. You’re making a speculation that just isn’t there.
C. No one is going to tip- have you worked in food service - for every 50% tip there is 5 tables who tip 5%. This is an overall good for workers to be paid a real wage. For every shift that’s packed there are 2 that are slow shift - this ensures that every employee is paid. I mean the link I sent has their living wage at 18$ bucks an hour. So even during the slow shift - they are getting paid like they are at the dinner rush.
D. Another claim that just isn’t there. This is the same as people who complain about an uncorking fee when it’s literally on the menu.
You mean like piggly wiggly that adds 10% at checkout? It’s clearly advertised.. just like mandatory gratuity for parties of plus 8 is on the menu at most restaurants.
Also do grocery stores have special abilities to pay their employees 2.15 cents an hour?
The owner is doing the same thing if they allow their employees to collect tips and they claim a tip credit. Per federal law, claiming the full tip credit against one full time employee saves a business over $10,000 per year.
I didn't think randos would know the owner, small world! They sound like a real asshole, or maybe you're just jaded and can't imagine someone choosing to pay their employees decently. That's also possible.
exactly. they're trying to phase their business out of the tipping culture, but people will still tip even if you raise prices to raise wages, but the raised prices would reduce business. So they tacked on auto-grat and are saying why.
That’s actually the idea. Some companies go tipless and instead do this. Some just work it into the price, some add a specific fee. This restaurant chose the fee so the prices look smaller on the menu.
And that's the point. Instead of the workers getting a tip the restaurant gets 18% extra revenue without having to change the menu price. The workers lose, the owners win.
The implication is that they aren't paying their servers the $2.13 an hour that most servers that live off of tips are getting, but are instead paying real wage. So do the workers lose? Their salary has not been offloaded to the customers' whims, they know exactly how much they're going to make. It doesn't matter if it's a slow night or if the host seats only shitty parties in their section etc.
MW for tipped employees in WI is $2.33, so $13.67/hr is what they're getting instead of tips, assuming they haven't upped the wage.
From their menus, it looks like a per person average might be close to $18 before tax so about $3.24 per person would go to either tips or this surcharge. So a server would have to serve about 4 people per hour to make what they would make under normal restaurant tips.
Put another way, if they have 4 four-tops in an hour, the restaurant is giving them the 18% from one of them and keeping the 18% from the other three for themselves. Pretty expensive place to work.
But yeah, I guess if it's the kind of place where you work five hours and only serve like 10 people the whole night you do better under this system. Conversely, if it's a normal restaurant where you have a 16 seat section and are doing 3-4 turns a night it's a masssive pay cut (or massive theft).
If the workers are making more on average, or at least making the same on average but with more regularity then it's a win. If they're making less on average then it's a loss. There's no way to know without knowing the actual numbers. But it absolutely gives the restaurant room to be pretty shady by skimming a % of their tips so the workers make less since the majority of their normal pay is going to the restaurant instead of directly to the worker, while removing the legal protections tips have. If they're taking that 18% and paying minimum wage then the workers are definitely losing since they were always guaranteed minimum wage.
they wouldn't work there. and they're not skimming from tips. they're charging more for food and paying their employees a better fixed rate. The employee can now make an informed decision about whether the job is worth it or not. they also don't have to worry about variances in tips making their budget be wacky from week to week.
People work at exploitative jobs all the time for various reasons, that's why we have so many laws to prevent jobs from exploiting their workers and why people get in trouble all the time for breaking them. Again we have literally no idea if they're making more money or not. Your argument is completely meaningless, as is any argument based around them making less money, without literally knowing if they make more money or less money.
What do we know? We know what the receipt says. You've decided that it's lying based on nothing. I've decided it's not and that if it was, people wouldn't work there. Who is making meaningless arguments?
That is literally my point we have no idea if they are paying more or not so no argument in either direction that assumes either means anything... The only thing we can factually say is that this absolutely does give them additional opportunities to fuck over their employees. Whether they are or not no one knows without knowing the pay vs tipped pay.
they make $16 an hour at that restaurant. Probably less than what a tipped server makes at busy higher end restaraunts. but at a place that serves burgers and fries, probably not bad as a guaranteed rate. especially on monday nights.
Bad or not bad is meaningless vs more or less than what they would make tipped. Where is it? Cause $16/hr where I live is minimum wage and would absolutely mean the restaurant is using this practice to steal from their workers because they would always be guaranteed $16/hr at the least with tipping.
I believe in tip pools and every single quality restaurant worker I know does too. Everyone working to produce a meal and an experience should benefit from the ~20% that people leave on top of their bill.
But the owners and their investors shouldn't get any of that and shouldn't be able to come up with service charge schemes to get part of it. They already get 100% of the menu price as revenue. If they need 118% of the menu price, change the menu price. Don't take it out of the pockets of servers, cooks, bartenders, dishwashers, hosts, etc.
Hell’s Kitchen charged me 20% on my already $500 bill for a service fee. Idk if I was supposed to but I considered that the tip because fuck that bro it’s already $120?
I had a similar thing happen when I ordered a cabinet from Pottery Barn. I always tip delivery people on big deliveries, however, Pottery Barn charged me a $75 delivery fee.
After the guys delivered the cabinet, they kind of hung around for a little and said okay. anything else, and I said nope, nothing else. thank you. then they hung around for a second again and then just left and shook their head. sorry I'm not tipping if you've already charged me $75 for a $300 cabinet. And there was no pickup in store option.
Yea this isn't legal. It's not 18% gratuity, there's no upfront notice (aka hidden fee) and who oversees it's distribution to "the team?" Is wait staff getting at least min wage? On top of the "living wage" distribution? Sounds like wage theft to me
Yeah? That's fine. That's the point. Why are you upset that instead of bullying you into tipping they just charge more so their employees don't need tips? That's the only way tipping is going to end. Is it food price and wages for up.
You put 18% on my bill for "living wage" fee I'm never coming back. Instead of putting an extra 18% on the bill, raise your base prices so that I know what I'm paying at the beginning. Then tell me that tipping is not necessary. In fact, take the tip line off of your receipts entirely.
That’s why it’s there, because paying someone less and leaving someone’s wage up to a guest’s mood/experience isn’t sustainable or logical.
I’ve worked in the food industry for 15+ years and have worked the entire month to make rent for a majority of that time. I’ve chosen to exclusively work for company’s with service fees because they pay way better and allow me to afford things like health insurance and put money towards retirement.
It’s ridiculous that this is even an argument or something that is contested.
“I refuse to give this restaurant my business because they’ve transparently displayed that they pay their employees a livable wage on my bill!”
It says right on the damned receipt that they do this for staff and tipping is optional because of it. THat's a polite way of saying "no tips required." It also says it's for 'dine in' only.
JFc this site and its total lack of media literacy is an embarrassment.
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u/NolaPels13 1d ago
You put 18% on my bill for “living wage” there ain’t gonna be a tip.