Column: End of tipping wages a step toward fair pay

In an announcement last week, Union Square Hospitality Groups’ chief executive Danny Meyer laid out a new plan to phase out tipping in 13 New York restaurants. With the new pay arrangement, average hourly wages will rise to a much more fair $15.25. (JSmith Photo/Flickr)

In an announcement last week, Union Square Hospitality Groups’ chief executive Danny Meyer laid out a new plan to phase out tipping in 13 New York restaurants. With the new pay arrangement, average hourly wages will rise to a much more fair $15.25, and likely help to reduce inequities in the service industry on a larger scale.

"There’s not a more important stakeholder to get right than our staff," Meyer said, insisting that ending tipping in exchange for wage improvements will be “a win” for cooks, entry-level managers, servers and all staff.

Meyer’s plan will be implemented by adjusting menu prices, and while making the change is expected to cost the Union Square Hospitality group $1 million to $1.5 million in lost tax credits, Meyer sees it as a positive change, and a necessary one to keep pace with New York’s steps to pay fast food workers $15 an hour. In reaching for better wages, the often discriminatory and categorically unfair tradition of tipping should be phased out through the service industry.

Many see tipping in restaurants and bars as a widely accepted, and largely “American” social norm, but it has also been shown to lead to widespread discrimination and selective pay for workers. Because of the reliance many servers have on tips as their main source of income, tipping also increases levels of awkwardness and even discrimination that take place at the staff level and within customer interactions.

Getting rid of tipping in exchange for better wages across the board is an important way to even the gap between kitchen and dining hall staff. Meyer, in the reasoning for his recent decision, said that the “gap between what the kitchen and dining room workers make has grown by leaps and bounds,” according to the New York Times. Meyer said that, during his time in the business, “kitchen income has gone up no more than 25 percent. Meanwhile, dining room pay has gone up 200 percent.”

A report by Restaurant Opportunities Centers United highlighted research on this topic, showing that “workers of color are concentrated in lower-level busser and kitchen positions in fine-dining restaurants and overall in segments of the industry in which earnings are lower.” Switching over to fair wages for all workers largely tackles this issue, and Meyer’s widespread implementation of such policy is a good sign. Union Square Hospitality Group’s pay increases will raise and help to equalize the wages of over 1,800 employees, and hopefully signal a cultural shift for the rest of the service industry to follow.

Changes to service industry pay scales to remove tipping can affect the relationship between customers and servers as well. Other than in restaurants and bars, no other industry relies on consumers to directly decide the wages of workers based on, essentially, how they feel about a person.

In the same report by Restaurant Opportunities Centers United, findings indicated that women and workers of color consistently receive average tipped wages lower than their white male counterparts. In one examination of wages in California, white male servers earned an average of $14.18 per hour, while women of color earned an average of $10.13 per hour – a harsh gap.

Tipping, while it may be framed by some as a good and honest way for the free market to uplift good service with additional pay, forces many others to accept poverty wages. It also perpetuates pay inequality with a separate, higher pay scale for those with the opportunity to work in well-tipped restaurants and positions.

Not only does the inherent inequality tied to tipping wages affect workers themselves, but it also perpetuates the judgment and servicing of “bad tippers,” as well as the racial stereotypes and expectations that create harmful and regressive workplace cultures. In a study published by the Daily Mail, as many as 40 percent of servers in North Carolina admit to changing the quality of their service to black customers because of the belief that they “don’t tip well.”

By paying workers higher wages, even if $15.25 isn’t high enough, restaurants and bars can individually start breaking down barriers and pay scales that thrive on discrimination. Forcing servers and others in the service industry to rely on the positive judgment of consumers for decent wages simply isn’t fair or good for American culture or economics. Following the lead of Union Square Hospitality Groups’ recent change, workers and policy makers should continue to fight tipping culture and secure fair and equitable wages.


Bennett Cognato is a contributor to The Daily Campus opinion section. He can be reached via email at bennett.cognato@uconn.edu.