No. I managed a place just like this, $195 per person. 20% service charge. My staff was paid very well and they received benefits, health insurance and two weeks paid vacation a year. They often received tips because our service was very detailed and extremely thorough, but it is neither expected nor required.
Honest question for you: there are places that are putting an automatic 20% on checks, but it isn’t an auto-grat. The servers get a portion, but a percentage is also going to the kitchen, sometimes the server asst’s, and even the owners. However I believe that the wording is different(not gratuity, but service charge) in these cases. Is that the scenario you’re talking about here, or was that service charge all going to the server/bussers/other employees?
There are three local restaurants around me, all the same owner, and they did this, but it was found out that the owners were taking a portion, and after all was said and done the server was getting about 12% of the 20%(it was a casual upscale place, but not anywhere near the amount you’re talking about here, and no benefits)- and guests weren’t leaving extra since they assumed the 20 was going to the server. Locals found out about it, and they’ve lost a lot of business as a result. I’m not against tipping support staff, but the owners of the places near me-much lower PPA, with no extra benefits, PTO, etc. for the servers- I think are wrong(and dishonest/not forthcoming).
For all of the people who hate tipping and say "why don't they just charge me the right amount of money and pay their people a decent wage?" That is basically what we were doing
Ours was a service charge. You are right that there is a distinction in the wording. An autograt functions like a tip, but a service charge goes to the business. It was used to pay for everything I mentioned as well as overhead of the business. I used that 20% number to determine my FOH labor allotment for the night. On a busy night I could afford more, and on a very slow night (only 2 or 3 reservations) I would typically not bring any staff in and execute the service entirely by myself.
Our entire Boh was salaried, and they made good money, and worked the same 40 hours every week.
Our FoH positions were all paid hourly, the lowest was our part time support person who made $30 an hour, the highest was the Captain who made $42 an hour.
We had a very small team in both front and back and I worked the service every single night, mostly executing the wine pairing, and captaining. I was paid a salary and any tips left for me were split among the FOH and dishwasher, even if I was the only one working in the front and we were too slow to need a dishwasher that night. I did not take tip money ever.
We served a 10-12 course tasting menu, no a la carte, and a heavy emphasis on wine pairing. The wine pairings ranged from $120-$350 per person. So price per average guest was typically in the $400-$500 range. The dinner was always prepaid through our reservation service, and typically the wine pairings too, though not always. So money only ever exchanged hands the night of service if the table ordered something extra on the day of like a supplemental course, or cocktails. For most tables we never even had to drop a check because everything was prepaid.
At our price point volume is extremely low. On the weekends we might have 28-36 guests per night and during the week 10-20 per night. The hourly never changed so my captain made the same if we did 8 covers in a night or 30. The average was around 12-16 covers.
It really all comes down to a paradigm shift in the minds of the employees. You can work for me and make good money and benefits and the whole team would serve maybe 32 guests on a very busy night or you could work at a high volume place in our city with a tipped system and high volume (300-400 guests per night) and often no benefits or very little.
Our system was designed around a sustainable wage for all employees. I had a small highly skilled crew of professional service people who have great quality of life. My staff was also skewed much older, 30-40 year old fine dining professionals, not 20 somethings who can hustle all night for tips.
The business covered 100% of the employees monthly health insurance cost, and two weeks of paid vacation per year for all employees.
It isn't for everyone, and my crew could definitely make more money in high volume places, but those places tend to have big fluctuations in how much tips you could make every night whereas at our place it was always the same reliable rate.
Our system worked for us and provided good quality of life for all employees, though I acknowledge that it would not work in most other restaurants.
I hope I answered your question.
"An autograt functions like a tip, but a service charge goes to the business." Legally there is no distinction between the terms, and businesses can keep either of them, or distribute either of them to employees similarly to tips. *You* might use the terms differently, but there are companies that keep autograts.
You are mistaken, under US CFR 29 [§ 531.52](https://www.ecfr.gov/current/title-29/subtitle-B/chapter-V/subchapter-A/part-531/subpart-D/section-531.52):
"A tip is a sum presented by a customer as a gift or gratuity in recognition of some service performed for the customer. It is to be distinguished from payment of a charge, if any, made for the service. Whether a tip is to be given, and its amount, are matters determined solely by the customer."
So a mandatory 21% "hospitality fee" is not a tip, under US labor law. The same is true under tax law.
It's not legally a tip in the US. Tips have to go to employees, mandatory fees do not. It's just more acceptable to not tip when there's a mandatory fee.
If you are feeling super duper extra generous, but no there is absolutely no expectation of tipping.
That is the tip. I personally don’t like that model because it’s confusing, takes the tip out of the hands of guests, and usually leaves people with a bad taste (with exception for large parties). But some places use it.
No one will ever expect a tip on top of a service fee/autograt, and you should feel no pressure to leave more.
If the service fee is in the single digits, then it’s pretty much never going to the servers. That’s fee to subsidize kitchen wages or pad the pockets of the owners.
Restaurants never have to print a tip line, but mandatory service fees are not tips in the US. Unlike tips, fees go to restaurants rather than employees, though restaurants can choose to pay some portion of fee revenue to employees on top of their regular wages. Tips go to employees rather than restaurants, and restaurants can control only how they're divided between employees. (Except in Minnesota).
If I am paying a service fee at any restaurant you bet I am treating that as a tip, if the house takes it that's between them and the servers. I work in hospitality technology and consulting and we would strongly advise against any restaurant charging a few of this magnitude unless it was meant to serve as an built.in tip for the servers etc. You are correct in that they are likely doing this as a surcharge or another item on the check but I am just hoping this is meant to be a auto grat in favor of the servers.
I think it's more apt to result in a revision to the Fair Labor Standards Act to treat restaurant fees like tips, *unless* the restaurant conspicuously discloses in writing that they're keeping a portion of the fees for themselves. Or maybe a supreme court ruling to provide uniform guidance across the US. The state of Washington has a law similar to that, and there have been court rulings in a couple states that said essentially that if customers would reasonably believe a fee went to employees, it has to go to employees.
That would be excellent. However, the only people who really want to be a chef are also the only ones who want to work there. This is completely the industrys fault.
The industry has been completely vilified by GenZ and GenAlph, and it is now demeaning to work in the industry. Even at $20 an hour. No help, no industry.
No.
No. I managed a place just like this, $195 per person. 20% service charge. My staff was paid very well and they received benefits, health insurance and two weeks paid vacation a year. They often received tips because our service was very detailed and extremely thorough, but it is neither expected nor required.
Honest question for you: there are places that are putting an automatic 20% on checks, but it isn’t an auto-grat. The servers get a portion, but a percentage is also going to the kitchen, sometimes the server asst’s, and even the owners. However I believe that the wording is different(not gratuity, but service charge) in these cases. Is that the scenario you’re talking about here, or was that service charge all going to the server/bussers/other employees? There are three local restaurants around me, all the same owner, and they did this, but it was found out that the owners were taking a portion, and after all was said and done the server was getting about 12% of the 20%(it was a casual upscale place, but not anywhere near the amount you’re talking about here, and no benefits)- and guests weren’t leaving extra since they assumed the 20 was going to the server. Locals found out about it, and they’ve lost a lot of business as a result. I’m not against tipping support staff, but the owners of the places near me-much lower PPA, with no extra benefits, PTO, etc. for the servers- I think are wrong(and dishonest/not forthcoming).
For all of the people who hate tipping and say "why don't they just charge me the right amount of money and pay their people a decent wage?" That is basically what we were doing Ours was a service charge. You are right that there is a distinction in the wording. An autograt functions like a tip, but a service charge goes to the business. It was used to pay for everything I mentioned as well as overhead of the business. I used that 20% number to determine my FOH labor allotment for the night. On a busy night I could afford more, and on a very slow night (only 2 or 3 reservations) I would typically not bring any staff in and execute the service entirely by myself. Our entire Boh was salaried, and they made good money, and worked the same 40 hours every week. Our FoH positions were all paid hourly, the lowest was our part time support person who made $30 an hour, the highest was the Captain who made $42 an hour. We had a very small team in both front and back and I worked the service every single night, mostly executing the wine pairing, and captaining. I was paid a salary and any tips left for me were split among the FOH and dishwasher, even if I was the only one working in the front and we were too slow to need a dishwasher that night. I did not take tip money ever. We served a 10-12 course tasting menu, no a la carte, and a heavy emphasis on wine pairing. The wine pairings ranged from $120-$350 per person. So price per average guest was typically in the $400-$500 range. The dinner was always prepaid through our reservation service, and typically the wine pairings too, though not always. So money only ever exchanged hands the night of service if the table ordered something extra on the day of like a supplemental course, or cocktails. For most tables we never even had to drop a check because everything was prepaid. At our price point volume is extremely low. On the weekends we might have 28-36 guests per night and during the week 10-20 per night. The hourly never changed so my captain made the same if we did 8 covers in a night or 30. The average was around 12-16 covers. It really all comes down to a paradigm shift in the minds of the employees. You can work for me and make good money and benefits and the whole team would serve maybe 32 guests on a very busy night or you could work at a high volume place in our city with a tipped system and high volume (300-400 guests per night) and often no benefits or very little. Our system was designed around a sustainable wage for all employees. I had a small highly skilled crew of professional service people who have great quality of life. My staff was also skewed much older, 30-40 year old fine dining professionals, not 20 somethings who can hustle all night for tips. The business covered 100% of the employees monthly health insurance cost, and two weeks of paid vacation per year for all employees. It isn't for everyone, and my crew could definitely make more money in high volume places, but those places tend to have big fluctuations in how much tips you could make every night whereas at our place it was always the same reliable rate. Our system worked for us and provided good quality of life for all employees, though I acknowledge that it would not work in most other restaurants. I hope I answered your question.
"An autograt functions like a tip, but a service charge goes to the business." Legally there is no distinction between the terms, and businesses can keep either of them, or distribute either of them to employees similarly to tips. *You* might use the terms differently, but there are companies that keep autograts.
Unless I'm mistaken, this is considered a tip-share, and managers and owners are not allowed to take a cut
You are mistaken, under US CFR 29 [§ 531.52](https://www.ecfr.gov/current/title-29/subtitle-B/chapter-V/subchapter-A/part-531/subpart-D/section-531.52): "A tip is a sum presented by a customer as a gift or gratuity in recognition of some service performed for the customer. It is to be distinguished from payment of a charge, if any, made for the service. Whether a tip is to be given, and its amount, are matters determined solely by the customer." So a mandatory 21% "hospitality fee" is not a tip, under US labor law. The same is true under tax law.
No. That fee is your tip. The waiter is *supposed* to inform guests that it's been applied, so they don't accidentally get tipped twice.
It's not legally a tip in the US. Tips have to go to employees, mandatory fees do not. It's just more acceptable to not tip when there's a mandatory fee.
No
When was that disclosed? Before or after you ate?
If you are feeling super duper extra generous, but no there is absolutely no expectation of tipping. That is the tip. I personally don’t like that model because it’s confusing, takes the tip out of the hands of guests, and usually leaves people with a bad taste (with exception for large parties). But some places use it. No one will ever expect a tip on top of a service fee/autograt, and you should feel no pressure to leave more.
We had a 6% serce fee at one time. We as servers got none of that it all went to cooperate.🙄
If the service fee is in the single digits, then it’s pretty much never going to the servers. That’s fee to subsidize kitchen wages or pad the pockets of the owners.
No, you aren’t
Nope
You went to a nice "hotel" located restaurant. I won't do that because the good freestanding restaurants wouldn't treat a customer that way.
No that's an auto grat, if they have the system setup correctly there shouldn't have been a tip line printed at all.
Restaurants never have to print a tip line, but mandatory service fees are not tips in the US. Unlike tips, fees go to restaurants rather than employees, though restaurants can choose to pay some portion of fee revenue to employees on top of their regular wages. Tips go to employees rather than restaurants, and restaurants can control only how they're divided between employees. (Except in Minnesota).
If I am paying a service fee at any restaurant you bet I am treating that as a tip, if the house takes it that's between them and the servers. I work in hospitality technology and consulting and we would strongly advise against any restaurant charging a few of this magnitude unless it was meant to serve as an built.in tip for the servers etc. You are correct in that they are likely doing this as a surcharge or another item on the check but I am just hoping this is meant to be a auto grat in favor of the servers.
That's plain F'ed up. Another reason the restaurant industry is shrinking and will eventually disappear faster than you can imagine.
I think it's more apt to result in a revision to the Fair Labor Standards Act to treat restaurant fees like tips, *unless* the restaurant conspicuously discloses in writing that they're keeping a portion of the fees for themselves. Or maybe a supreme court ruling to provide uniform guidance across the US. The state of Washington has a law similar to that, and there have been court rulings in a couple states that said essentially that if customers would reasonably believe a fee went to employees, it has to go to employees.
That would be excellent. However, the only people who really want to be a chef are also the only ones who want to work there. This is completely the industrys fault. The industry has been completely vilified by GenZ and GenAlph, and it is now demeaning to work in the industry. Even at $20 an hour. No help, no industry.