facebook pixal

Big-name operators hit with no-tipping lawsuit

Class action alleges no-tipping policies are ‘conspiracy’ to raise menu prices

Danny Meyer, David Chang and other big-name full-service operators have been named in a class-action lawsuit asserting that no-tipping policies are a “conspiracy” to charge more for food.

The defendants also include Tom Colicchio, Daniel Humm, Will Guidara, Andrew Tarlow, the New York City Hospitality Alliance and the Golden Gate Restaurant Association.

 “The ongoing conspiracy unlawfully transfers millions of dollars from customers and servers to restaurant owners in violation of federal and state antitrust laws,” the complaint states. “Participating restaurants and a compliant media have portrayed the no-tipping higher prices movement as intended to promote social justice and equality, while the real aim and effect is greater profit at the expense of workers and consumers.”

Meyer’s Union Square Hospitality Group, for one, is undeterred by the suit and said it has no plans to discontinue its no-tipping policy, known as Hospitality Included.

We undertook the challenging and lonely journey of introducing Hospitality Included to create clear and transparent growth paths for our people, while beginning to address the decades-long growth of inequality among restaurant professionals,” the company said in a statement. “We believe hospitality can and should be a viable career with competitive wages, and we are more committed than ever to Hospitality Included getting us there.”

The plaintiff is listed as Timothy Brown, who “purchased food from certain defendant restaurants during the course of the conspiracy, and was overcharged as a direct result of the conspiracy,” the suit states.

The suit seeks threefold the actual damages incurred by members of the class-action group, as well as that all defendants “must withdraw from the conspiracy … and notify their co-conspirators and appropriate law enforcement officials that they have done so.”

USHG announced it would institute a no-tipping policy at all of the group’s restaurants two years ago to even the inequity between tipped and untipped employees. Since then, a number of both full-service and limited-service concepts have axed tipping.

But some restaurants are returning to tipping after finding intense customer dissatisfaction with the no-tipping policies.

Want breaking news at your fingertips?

Get today’s need-to-know restaurant industry intelligence. Sign up to receive texts from Restaurant Business on news and insights that matter to your brand.


More from our partners