A fancy restaurant in New York City is eliminating tips and opting for a mandatory service charge of 20 percent of the bill. The restaurant has a noble mission. The cooks are struggling at minimum-wage jobs while waiters, also minimum-wage workers, retain all the benefits of the tips. However, I’m not sure that this is the solution to the problem.
It looks like an alternative to raising food prices, but not a good choice. The restaurant, Per Se, seems to be well-reviewed but perhaps raising food prices would create a competitive disavntage within the fierce New York restaurant industry. The idea of a mandatory service charge perhaps gets around the need to charge more for food than comparable restaurants.
I usually tip 20 percent anyway, as most people I know do. If the average customer already tips 20 percent, the restaurant isn’t gaining any money, but the waiters are giving away a portion of their “extra” income to the cooks in the kitchen. There must be a better way where everyone wins and nobody has to make a minimum wage that is far too low.
Also, with a mandatory tip, waiters may not be inclined to provide good service. I, for one, would miss the smiley faces and the letters dotted with hearts the waitresses tend to draw on the bill. Also, how will I feel good about myself while dining if waitresses aren’t flirting with me to coax a higher tip out of me and my positive self image? (It doesn’t work, I still tip about 20 percent unless there is a really obvious reason not to, but don’t tell them that.)
Amuse Bouche seems to agree about the possibility of unmotivated servers due to the demise of the tip.
Updated February 6, 2012 and originally published August 18, 2005. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.