Restaurateur Danny Meyers is finally implementing what he refers to as "hospitality included" at his New York City restaurants. The Times took a look at the Modern as front and back of the house employees prepare for the transition to a tip-free restaurant. As that system rolls out, the restaurant community will certainly closely watch, identifying what portions of the program work and what issues arise in a paradigm shift that could potentially change how all restaurant workers are compensated.
In Dallas, restaurant owners are also considering the benefits of directly paying all of their employees a fair wage, but it's tricky. Since 2012, Russell Hayward has run his coffee shop and restaurant Ascension in the Design District like most food businesses, paying his kitchen employees a normal hourly rate while servers and other regularly tipped employees see a far smaller hourly wage. Raising menu prices to offset those tips and perhaps pay employees a bit more sounds simple until a closer look is taken at how those tips have been collected in the past.
Some customers come in, grab a quick pour-over and jet out the door, while others take a seat, place an order with a server and perhaps get a snack. These two customer types tip differently, so raising prices across the board could cause some grumbling with hurried customers. Hayward says if his restaurant made use of table service alone he'd probably have phased tips out long ago. "Our situation is a little more complex than most," he says. Still, he's continuing to work to embrace a more progressive compensation program for his restaurant.
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Other Dallas restaurateurs are curious about the shift, but much less ready to make a change until a new system has been proven effective. "I wish I had the balls to be at the forefront," Jon Alexis of TJ's Seafood says, even though he thinks the change is inevitable for the industry as a whole. "The American tipping system is so ingrained with the customers and the staff that I don't want to be on the front line of changing minds," he says. Should more restaurants embrace a hospitality included compensation model, though, he says he'll happily jump on the bandwagon.
Brian Zenner at the Mitchell is taking a slightly different approach. "I am not against tipping, but will look to eliminate positions which are paid primarily through tips in the future," he says. Most counter service restaurants, for instance, don't rely on tips at all. A similar shift in more formal restaurants would be much more difficult.
Back at Ascension, Hayward seems the most likely to first implement a change. "We've had three meetings on it so far," he says as he tries to analyze how sales and income can be fairly distributed amongst his employees. Dallas' restaurant community will likely be watching him very closely if he continues the effort. "My plan is end of year if it's possible at all," he says.