At my Los Angeles restaurant, All Time, we recently implemented a 20 percent gratuity on all takeout orders. We make a point to communicate the charge transparently, and — as advertised — 100 percent of that money goes directly into the tip pool for our hourly staff, composed of not just front-of-house workers but also our dishwashers, line cooks, and the prep team. I was surprised when emails started to come in from customers that included lines like, “I am not asking for a refund for my meal — I am asking for the tip back,” or “I was shocked to be confronted with a ‘mandatory gratuity of 20 percent’ … I asked if I could change my gratuity, as I felt over $5 was exorbitant.” None of these complaints were about the quality of the service (if something negative had happened, we could have taken steps to remedy it immediately). They were instead complaints about simply having to tip at all.
I thought about these messages last week when I read a New York Times piece focused on “tipping fatigue,” which, according to the report, is both “real” and “widespread.” Per the story, “Many customers and experts in the hospitality industry say that deciding how much money to leave, or whether to leave a tip at all, has become a tougher decision — complicated by new technology, and requests for tips at food business of all types, from bakeries and yogurt shops to food trucks and juice bars.”
Perhaps, I thought, people are just confused, which is understandable. Over the past several years, consumers of all kinds have been inundated with surcharges and phrases that sound like they could be a tip but, in fact, are not. For example, many restaurants add a “service charge” to the bill. Though fully legal, this is not a tip. That income gets absorbed into, and taxed as, revenue, and it is used to offset labor and other operating costs. At other establishments, something like a 3 percent fee might be added to support another operating cost, such as health insurance for employees. Again, not a tip. On top of any of these potential fees, customers will see a line to add an optional “additional” tip (which by law must go entirely to staff); of course, this doesn’t account for the possible automatic gratuity that can be added in certain cases, say for larger parties or on takeout orders, which also goes to staff.
Then I recalled another message I received — “Because I had to pay up front not knowing what my experience or meal was going to be, I had deliberately pressed ‘No Tip.’ And as little as it is, I will be needing my $8 tip refunded” — and it drove home why it felt so necessary to add a gratuity to our takeout orders in the first place. As soon as the shock of the pandemic wore off, it became clear to us that people no longer thought takeout food merited a tip. But your coffee isn’t coming out of a vending machine. There’s a human being in front of you — taking the order — and a team of other people you don’t see: They’re washing dishes, making sandwiches, bagging food, double-checking orders, tossing in extra napkins, remembering your hot sauce or extra dressing. At least at our restaurant, takeout requires more people on the floor and more complex logistics than dine-in. And we have to ensure that our people are taken care of.
There’s a misconception that restaurant owners are somehow failing to pay (or, worse, choosing to avoid paying) “a livable wage,” and that’s why you, the customer, must tip. That notion is false. Let’s look at the economics: In the service industry, it’s considered good pay to take home between $40 and $60 per hour, a rate that includes tips. But a restaurant that sells salads and pizzas simply cannot support paying that kind of wage for the number of employees required to create a truly great service experience.
To have a shot at hiring good people, you have to pay more than minimum wage, and we do. But the cost of living — especially in cities with lots of great restaurants — is high and rising, and working 40 hours a week at even $20 per hour won’t cover rent in Los Angeles. Our guests also don’t see or understand all the work that goes into great service or the heavy financial load of operating a restaurant. Costs like workers’ comp insurance, liability insurance, cost of goods, cost of materials, paper, lawyers — there’s a lot. We’ve run the numbers, and paying the required number of employees a wage that is commensurate with their earnings (including tips and staying in business) would mean charging around $40 for a turkey sandwich or $25 for a cup of coffee.
Exactly for that reason, there are food businesses built specifically to keep staffing as lean as possible. “Fast-casual” restaurants are economically efficient, but that’s not what we’re aiming to offer at our restaurant, and I know it’s not the kind of experience that many others in the service industry (including those on our team) want to create, either. Tipping is woven into hospitality, for better or for worse, and has been for a long time. I’m not suggesting that restaurant economics aren’t without their flaws, but think about it: There’s also a reason that your experience at the DMV feels different than your experience at your favorite restaurant.
When you come to our restaurant, even if you’re just grabbing a cup of coffee to go, someone, a real person, will take care of you. We want to create a connection, something that’s increasingly rare in a world that’s become defined by digital interactions.
I wish I could pull all of our guests into the kitchen so they could see the extreme care our line cook uses as he slices every New York steak or how thoughtfully he balances a charred lemon on top of the striped bass. I wish I could livestream the espresso station in the thick of a slammed Sunday service so anyone could see the barista dumping out drinks that don’t meet our standards, no matter how many tickets are on the rail. I wish people could watch our breakfast cooks move in unison during brunch like a high-octane sports team, putting out food so able and so fast it has no business being so delicious or good-looking. Whether you’re eating your food at our table or yours, the people who prepared it are highly skilled. They also care, a lot, about their work — and about you. If they didn’t, they’d likely find something much easier, or more lucrative, to do for work. Probably both.
We know times are difficult right now, especially financially. Everything is more expensive, and everyone is feeling that. We’re all trying to hang on to what we have, but a tip is not an expectation for a handout. It’s part of the real cost of keeping the best people on our team. It demonstrates that you value their work, too, and it allows us to make the best food we possibly can while serving it to you with grace and warmth. If you’re going to spend what it costs to go out for a $30 lunch, please don’t pickpocket the little guy — the few bucks extra that go into the busboy’s pay, or to the musician working two jobs to chase her dream, or to the single dad who can’t wait to get off work and get home to his daughter.
Tipping isn’t charity, and it isn’t going anywhere, either. It’s a wholly necessary way to show you value the work of the people whom we define as integral to hospitality.