Tipping at restaurants has been the subject of many a recent thinkpieces, with arguments made that because tip-dependent employees can be paid a lower hourly wage, they often walk away with a salary below minimum wage. Some restaurants and chefs are now moving away from a gratuity model, including the relaunch of Amanda Cohen's popular vegetarian eatery Dirt Candy, which will open next year in a larger space on the LES.
Today Eater broke the news that Cohen would be abolishing tips at the new restaurant, instead implementing an "administrative fee of around 20%" that will be added to every check. The percentage fee will prevent a diner from under tipping—and over tipping, unless they use cash, as there won't be a line on credit card receipts to leave additional gratuity. Cohen told us that if a diner "leaves extra cash that cash can only go to the servers since it is considered a tip."
Dependent on the amount of money diners spend on each bill, Cohen says she hopes front of house staff (servers) will get around $25 to $35 per hour, while back of house staff (cooks) will make between $18 and $19. Bartenders will be subject to the same policy.
First of all, it's great that back of house staff—who are typically not included in a tip pool—will be benefitting from this model; plus, a fee means that a customer can't willfully or ignorantly shortchange the staff. But a "20% administrative fee" sounds suspiciously like an auto-gratuity, the kind of thing restaurants will use for large parties or, in certain murky cases, for a table a server feels might not tip the accustomed percentage. Diners are still paying a tip in this model, even if it goes by a different name.
Cohen disagrees, arguing that "auto-gratuity implies that the money is going to the servers," while an "administrative fee money can be distributed in any way that management see fit," she said via email. Really it all comes down to semantics; at the end of it all, at least people are getting paid.
Other tip abolishing eateries have skewed towards a model that raises prices on dishes and pays their employees a standard living wage. Cohen says she feared that route would dissuade diners from entering the restaurant, thinking it was too expensive. "What are we going to do? Run out each time and say, 'Wait, here's our manifesto. Service is included!'" It's a bit of a moot point anyway, as prices will be higher than the OG Dirt Candy (larger space, more staff, etc.).