At spots like the Dahlia Lounge and Barnacle, diners are accustomed to the 20 percent surcharge added at the end of their bill; in fact, Renee Erickson and Tom Douglas restaurants ousted traditional tipping in May 2015 and February 2016, respectively. While these high profile restaurants have received attention for removing the tip line from their checks, a few others decided to take a different approach. Enter businesses like Optimism Brewing, Seattle Coffee Works, and Ada’s Technical Books and Cafe, which eliminated tipping altogether and instead opted to raise prices in order to pay their employees a higher wage.
The city of Seattle instituted an ordinance in 2015 that increased the minimum wage to $15. But for some it isn’t enough quite enough. Indeed, tipped employees are on the slowest track towards the $15 minimum wage, with small businesses slotted to fill the requirement in 2021. In the years since the ordinance passed, the pay discrepancies surrounding tipping have become all the more glaring, inspiring some business owners to shake up the established system with service fees and no-tip policies.
But with tipping so ingrained in American culture, going tipless proves difficult no matter the approach.
Businesses like Seattle Coffee Works face a larger risk of losing customers unwilling to pay more for, say, a cup of coffee that used to cost 20 percent less. (This problem often pushes restaurants toward service fees, which ensure high tips for servers while keeping menu prices stable.) Factor in competitors that can easily undercut new, increased prices and you’ve got a dilemma.
Seattle Coffee Works founder Sebastian Simsch points to an anxiety in the hospitality business because “payroll is our biggest expense.” Raising payroll—which will likely never go back down—is therefore, in Simsch’s words, “a huge deal.” In spite of all the deterring factors, these businesses, and others, nevertheless eliminated tipping: Optimism Brewing opened its doors with a no-tip policy back in December 2015; Seattle Coffee Works axed tipping this May; and Ada’s is the newest member to join the movement, going tip free October 21.
For Optimism Brewing’s Gay Gilmore and husband Troy Hakala, the decision to go tipless was largely based on their own experience. “As customers when we got out, we don’t like having to tip. It feels really weird,” said Gilmore. Not wanting to put their customers in the same position, they decided to eliminate the awkwardness by nixing tips. It was only after that decision that the two started digging into the history of tipping, learning about its classist, racist, and sexist past. On a sign posted at Optimism’s counter and on all of its paper menus, customers can read Gilmore and Hakala’s findings, such as, Tipping was an aristocratic custom that did not take hold in the United States until slavery was abolished. Employers didn’t like having to pay wages to newly freed African-Americans, so tipping became their only source of income.
Gilmore noted that the sign is often photographed and shared on social media, and she’s proud that Optimism is starting a conversation around tipping. “When you’re at the vanguard of something—and I truly believe the movement is happening—you are going to have to spend more time on education, because it takes that to change something that is so entrenched,” she said. Education, however, not only extends to customers, but other businesses as well. Though Seattle Coffee Works and Ada's Technical Books and Cafe's owners came to the decision on their own, Ada’s co-owner Danielle Hulton noted she hadn’t been aware of the historical problems associated with tipping prior to becoming a regular at the taphouse. “They helped educate me too.”
While Ada’s business model is certainly unique—the space is part bookstore, part cafe, part coworking space, and an event space—it also aligns best with a traditional restaurant model, with a division between front of house and back of house. After circling around the issue, Hulton finally decided that eradicating tipping and adjusting menu prices was the correct way “to take as good of care of my staff as I can.”
Simsch of Seattle Coffee Works likewise explained that he was motivated to switch to a no-tip policy to be able to pay his staff a livable wage. Soon Simsch realized that employees needed not just a higher income, but a steadier income. Tipping, of course, was the main source of instability, as he was forced to balance well-tipped and poorly-tipped shifts rather than writing schedules based on baristas’ availabilities.
While the new protocol won over the three business owners, some of their employees were skeptical at first—it was, after all, their livelihoods on the line. Simsch recalled that an initial meeting was heated because employees were concerned that the price hikes would garner bad press. Melanie Mazza, who works primarily at Capitol Coffee Works, was "afraid it would be overall less money and affect morale or customer service at work, especially on busy shifts.” When she got into the rhythm of a regular bimonthly paycheck, however, she began to feel comfortable with the change. As Optimism opened with a no-tip policy, Gilmore didn’t experience quite the same discomfort on her staff. “We tend to like people who have not been in the industry because they haven’t developed that cynicism. And the people who have come from the industry, they tell us what a great relief it is for them to not feel that way,” she said.
As for customers’ reactions, Simsch noted that almost all customers reacted either positively or indifferently, and that nine out of ten were extremely complimentary. Hulton, who works on the floor at Ada’s about five hours each week, said that several customers have congratulated her, assuming she was benefitting from the new hourly wage and not realizing she was, in fact, the owner. While working a shift at Ballard Coffee Works, Mazza had a regular customer bring in cupcakes, telling the baristas that they wanted to show their gratitude in lieu of tipping.
For every thousand kind customers, a few have reacted adversely to the businesses’ no-tip policies. Gilmore explained that some customers like the power of tipping and will try to throw money across the bar. “Some people are definitely aggressive about it, and I will tell you 100 percent of the time, it’s men,” she said. At the same time, she said, if restaurants are honest about the cost of their product, then “I can guarantee you that the impression that people will have of that business will go up."
Though Gilmore believes the movement is growing, at the end of the day she focuses on Optimism. Simsch expressed similar sentiments, suggesting that there’s little time to “go out and convince other people to do the same thing.” And Seattle is certainly not the only city with tipless restaurants. New York restaurateur Danny Meyer is one notable proponent of eliminating tips. Still, the trend hasn’t picked up the same momentum as the minimum wage ordinance. With some restaurants—Portland’s Le Pigeon and Little Bird Bistro, national chain Joe’s Crab Shack, and Seattle’s own Mollusk—returning to tipping after brief flirtations with no-tip policies and service charges, it seems we’ll be stuck with the antiquated practice, at least for the time being.