In anticipation of Seattle’s historic minimum wage increase, many restaurants have struggled to figure out how to cover higher labor costs. Restaurant owners agree that menu prices will have to increase at least slightly, but beyond that, most seem unsure of what to do. Add surcharges and service fees? Eliminate tipping? Most business owners have adopted a “wait-and-see” approach, looking to what their colleagues do in the coming weeks and months before implementing any significant changes of their own.
But at least one Seattle restaurant is taking action. Starting April 1—when the minimum wage for Seattle workers will increase from $9.47 to either $10 or $11—Ivar’s, the iconic local restaurant chain famous for clam chowder and fish ’n’ chips, will raise the wages of all employees at Ivar’s Salmon House to $15 an hour. They will also remove the tip line from checks, effectively eliminating tipping.
Bob Donegan, Ivar’s president and CEO, said that the Lake Union restaurant will be the only location of his restaurant chain to introduce the no-tipping system. His company, which employs more than 1,000 people regionally and technically has until January 1, 2018 to bring all of its employees to $15 an hour, will follow the city’s new minimum wage ordinance for its fast-food seafood bars, raising wages to $11 on April 1, counting tips and benefits against $15. The Salmon House is opting for its own version of complying with the law. “We are testing different models in different divisions,” says Donegan.
On Saturday, March 21, managers at the full-service Ivar’s Salmon House held a meeting to present the new policy to staff, giving them just ten days’ notice of a complete overhaul to the way they get paid. One longtime server, who spoke on the condition of anonymity, expressed anxiety and fear over what the new policy would mean for yearly wages, both for servers and back-of-house staff.
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