Two weeks ago at the Charleston Wine and Food Festival, in South Carolina, the James Beard Foundation staged a debate on an issue that’s dividing restaurateurs and diners across the country: whether to include the service charge in the price of a meal, or to maintain the traditional model of tipping as the servers’ primary method of payment.
The “service included” side of the issue is well represented in this town—Tom Douglas and Ethan Stowell restaurants have both gone with that model—and the reasons are well-known. It distributes income more equitably among front-of-house and back-of-house (or “heart-of-house,” in Stowell’s parlance) employees, and removes income fluctuations among servers. Implicit bias and sexist nonsense can rear their heads in the tipping of racial minorities and women, respectively; the service-included model eliminates these inequities. At the Beard debate, service-included champion Sabato Sagaria (of Danny Meyer’s Union Square Hospitality Group) called it the only model that’s sustainable in the long-term, given rising costs of food and operations and, most visibly, minimum wage.
Arguing for the tipping-as-usual side was Virginia restaurateur Joy Crump (Foode, Mercantile), who argued that service included simply wasn’t tenable without an entirely new restaurant business model and/or cultural norm, as it couldn’t ensure a living wage for all while giving customers the service quality they want. Crump questioned the studies which show tipping percentages do not correspond with diners’ perception of service quality; by her anecdotal experience, tips go down when service is poor. Moreover, margins are already narrow in the restaurant business, she said; this narrows them. Servers were frustrated, as it rendered their profession less lucrative; so, Crump argued, were customers, who balked at the higher prices, took business elsewhere, or spent less on meals.
Crump spoke from experience: One of her restaurants opened as a service included but switched when customers and employees complained. Locally that’s something Seattle restaurateur Jake Kosseff knows a thing or two about. He opened Circadia last November as a service-included restaurant, with this explanation on the menu: “We do not accept tips nor do we add service charges. We believe our guests should not pay twice for great service.”
In recent weeks, Kosseff withdrew the policy, citing guest confusion. “We made the change based on feedback from our guests that they preferred a traditional tipping model,” he said. “We felt that spending too much time explaining what we were doing, and why, distracted from the service and guest experience we were trying to create.” Though Kosseff added that Circadia may go back to the service-included model in the future, a waiter I spoke with at Circadia hinted at quitting if they did.
It just wasn’t adding up to enough money, that waiter told me.