Tipping Tip: Tipping Won't Cure Restaurant Economics
THURSDAY, AUGUST 20, 2020 --
You hear a lot of chatter these days about how we are supposed to tip in the age of Coronavirus.
It is generally the people who decided to become more generous tippers who chatter the loudest. They encourage others, sometimes strenuously, to do the same.
I read one article whose author claimed to have upped her usual 20 or 25 percent restaurant gratuity policy to 50 percent. Outside my favorite garden center just yesterday I overheard one middle-aged man proudly telling another that he had recently begun tipping for takeout orders, "at least until things get sorted out around here with the COVID."
All well and good. How can we not applaud such socially minded acts of generosity and kindness? It's this precise spirit that makes America great, after all.
Service workers deserve gratitude and respect for their labors. That goes double during a pandemic. I mean, they are putting themselves and their families at risk just by punching the clock, aren't they?
God knows they can use all the financial help they can get. Median annual wages for people such as restaurant servers are in the low-$20,000 range. Please. My wife and I own a handful of Amazon shares that are worth more than that.
And so I say keep it up. Tip until it hurts, baby.
As a lifelong and very frequent user of restaurants of all types I have certainly done my part to support the food-and-beverage industry's economy through the years. And my tendency is to tip on the high side, not the low. (Oh, and yes, I am in fact one of those people who practice enhanced tipping during these difficult and trying times.)
But I'd never given a lot of thought to a typical restaurant worker's earning power, at least not in a broad and expansive way. It took this damned pandemic and subsequent economic meltdown to do that.
And, you know, the more I think about how things work the more agitated I get.
To note the painfully obvious, without tips there wouldn't even be a restaurant business. Not in the United States there wouldn't be. Restaurant owners here can pay their workers as little as $2.13 an hour and not be sent to prison for it. That's a federal hourly wage set by the Fair Labor Standards Act, by the way.
I don't know about you, but my parents taught me the meaning of the word "fair" when I was too young to know what an hourly wage was. And, believe me, $2.13 ain't it.
Yes, of course, this hourly rate applies only to workers who are eligible to earn tips above and beyond it. But c'mon! Name me another industry that works this way. And gets away with it.
Basically, we're talking about a fundamentally un-American economic system. Restaurants, a lot of them anyway, don't have to--and aren't required to--pay their workers a fair or even a living wage for their labors. It is their customers who are required to step in and do this. In other words, voluntarily pay in the form of "tips" for essential work.
Just think about that for a minute. Customers--as in you and I--get to decide what the people who work for these businesses are allowed to earn on any given day or week or year.
We're not talking about some backwater industry of scant economic consequence here either. Before the pandemic, there were around a million restaurants in the United States, employing well over 15 million people. This year's pre-pandemic estimates put the restaurant industry's revenues at just under $900 billion. Real numbers, in other words.
And yet from a human resources perspective the backwater tag isn't so far off the mark. Get this. Of the ten lowest-paying jobs in America, seven are restaurant jobs. That's including restaurant workers who are fortunate enough to collect tips from people like you and me.
Inequities in the way these people are compensated and treated are far too varied to analyze in a forum such as this. But suffice to say they are many and legend. Hell, even laws that regulate how tips are paid to certain hourly workers specifically forbid other equally deserving employees from collecting any tips at all.
Danny Meyer is one of the country's most successful restaurant operators. For years he has argued that tipping should be abandoned and that the industry professionalize its policies regarding workers. In 2015 he went so far as to institute a no-tipping policy at his high-end New York restaurants such as Gramercy Tavern and Union Square Cafe.
"The American system of tipping is awkward for all parties involved," Meyer explained at the time. "Restaurant patrons are expected to have the expertise to motivate and properly remunerate service professionals; servers are expected to please up to 1,000 different employers (for most of us, one boss is enough!); and restaurateurs surrender their use of compensation as an appropriate tool to reward merit and promote excellence."
Meyer's no-tipping policy didn't catch on and he finally abandoned it last month when re-opening his restaurants. Still, he vows to continue lobbying for more equitable pay and better professionalism throughout the entire industry.
Good luck with that, Danny.
It is generally the people who decided to become more generous tippers who chatter the loudest. They encourage others, sometimes strenuously, to do the same.
I read one article whose author claimed to have upped her usual 20 or 25 percent restaurant gratuity policy to 50 percent. Outside my favorite garden center just yesterday I overheard one middle-aged man proudly telling another that he had recently begun tipping for takeout orders, "at least until things get sorted out around here with the COVID."
All well and good. How can we not applaud such socially minded acts of generosity and kindness? It's this precise spirit that makes America great, after all.
Service workers deserve gratitude and respect for their labors. That goes double during a pandemic. I mean, they are putting themselves and their families at risk just by punching the clock, aren't they?
God knows they can use all the financial help they can get. Median annual wages for people such as restaurant servers are in the low-$20,000 range. Please. My wife and I own a handful of Amazon shares that are worth more than that.
And so I say keep it up. Tip until it hurts, baby.
As a lifelong and very frequent user of restaurants of all types I have certainly done my part to support the food-and-beverage industry's economy through the years. And my tendency is to tip on the high side, not the low. (Oh, and yes, I am in fact one of those people who practice enhanced tipping during these difficult and trying times.)
But I'd never given a lot of thought to a typical restaurant worker's earning power, at least not in a broad and expansive way. It took this damned pandemic and subsequent economic meltdown to do that.
And, you know, the more I think about how things work the more agitated I get.
To note the painfully obvious, without tips there wouldn't even be a restaurant business. Not in the United States there wouldn't be. Restaurant owners here can pay their workers as little as $2.13 an hour and not be sent to prison for it. That's a federal hourly wage set by the Fair Labor Standards Act, by the way.
I don't know about you, but my parents taught me the meaning of the word "fair" when I was too young to know what an hourly wage was. And, believe me, $2.13 ain't it.
Yes, of course, this hourly rate applies only to workers who are eligible to earn tips above and beyond it. But c'mon! Name me another industry that works this way. And gets away with it.
Basically, we're talking about a fundamentally un-American economic system. Restaurants, a lot of them anyway, don't have to--and aren't required to--pay their workers a fair or even a living wage for their labors. It is their customers who are required to step in and do this. In other words, voluntarily pay in the form of "tips" for essential work.
Just think about that for a minute. Customers--as in you and I--get to decide what the people who work for these businesses are allowed to earn on any given day or week or year.
We're not talking about some backwater industry of scant economic consequence here either. Before the pandemic, there were around a million restaurants in the United States, employing well over 15 million people. This year's pre-pandemic estimates put the restaurant industry's revenues at just under $900 billion. Real numbers, in other words.
And yet from a human resources perspective the backwater tag isn't so far off the mark. Get this. Of the ten lowest-paying jobs in America, seven are restaurant jobs. That's including restaurant workers who are fortunate enough to collect tips from people like you and me.
Inequities in the way these people are compensated and treated are far too varied to analyze in a forum such as this. But suffice to say they are many and legend. Hell, even laws that regulate how tips are paid to certain hourly workers specifically forbid other equally deserving employees from collecting any tips at all.
Danny Meyer is one of the country's most successful restaurant operators. For years he has argued that tipping should be abandoned and that the industry professionalize its policies regarding workers. In 2015 he went so far as to institute a no-tipping policy at his high-end New York restaurants such as Gramercy Tavern and Union Square Cafe.
"The American system of tipping is awkward for all parties involved," Meyer explained at the time. "Restaurant patrons are expected to have the expertise to motivate and properly remunerate service professionals; servers are expected to please up to 1,000 different employers (for most of us, one boss is enough!); and restaurateurs surrender their use of compensation as an appropriate tool to reward merit and promote excellence."
Meyer's no-tipping policy didn't catch on and he finally abandoned it last month when re-opening his restaurants. Still, he vows to continue lobbying for more equitable pay and better professionalism throughout the entire industry.
Good luck with that, Danny.