Is tipping at the tipping point?

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It’s been about a year since Union Square Hospitality Group’s President and CEO Danny Meyer started implementing his no-tipping policy as a new mode of compensation. Tom Colicchio—owner of Craft, Craftsteak and others—was among the other restaurateurs who embraced the idea. But at this point, few others on the Top 100 list have.

“It’s an interesting idea,” says Michael Jacobs, partner at Corner Table Restaurants in New York City. “I understand what Danny’s trying to do, but I firmly believe the American consumer is not ready to adopt that component. In certain circumstances, it works. But we don’t foresee any changeover to a no-tipping policy in our business, just based on the way menu pricing will have to fall out afterwards. If we’re looking to be a value-oriented casual brasserie, I can’t have a $30 burger. Whether you’re going to tip or not, I think what the guest perceives is that it’s a $30 burger, not a $20 burger that includes a tip.”

Quality Branded founder and President Michael Stillman believes that there’s a global transition in the way people are being paid in restaurants, and it’s been coming for quite some time. It’s not without good reason, he says:  There’s definitely an imbalance between front-of-house and back-of-house service staff. “As I talk to restaurateurs, they believe the system is disjointed and there needs to be some sort of new model. But I think no one is sure what that is. We don’t want to hurt our front-of-house staff either.”

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