Tipping and the Back of the House

Michael Nagrant / 05.04.08

Chris Borrelli had a good article in the Chicago Tribune last week about tips and how they get disbursed. I think the article made some great points, especially about what I consider an exploitative behavior of some restaurants which charge a percentage of the waiter’s tip to cover credit card processing fees, as if it’s the waiter’s fault the restaurant accepts plastic.

Assuming the restaurant doesn’t pay a flat processing fee to the credit card company, I might buy into the idea of sharing a percentage of the cost of a tip on an exceedingly large gratuity, since the restaurant would have to pay a greater processing fee without receiving any portion of the tip. Of course, I’d more likely accept that premise if restaurants started treating their waiters as real business partners and paid them full minimum wage.

One aspect that wasn’t covered in the article which I think bears some attention is the long simmering tension between the front of the house (i.e. the service staff) and the back of the house (the cooks and dishwashers etc), particularly in high end restaurants, which is often exacerbated by the tip system.

In elite restaurants, many chefs work a minimum of 14 hour days, and that’s a conservative estimate. I know of many local restaurants where’s it’s not uncommon to pull the occasional or regular 80-90 hour work week as a line cook.

In those same establishments, waiters tend to come in a few hours later and are often the first to leave at the end of the service. Now, I’m not arguing that servers don’t work hard. They stand on their feet and carry heavy plates and cases of wine for hours on end. Likewise, good service requires a unique and valuable skill set, like the ability to cultivate a relationship with a customer and be exacting without being too overbearing, something chefs can’t always do. At the end of the day, from what I’ve seen, the front of house work is usually cleaner, more air-conditioned, and many of these folks work a few less hours.

That being said, even if servers and line cooks worked the same hours or had exactly similar responsibilities, the disparity in their wages, especially at these high end establishments is extraordinary. At the really high end spots, it’s not uncommon for servers to pull in $60-80,000 while a typical line cook makes $24-28,000 dollars.

Part of the reason for the disparity is that restaurants generally subsidize the full labor cost of a kitchen worker, whereas, the server’s salary is subsidized by customer tips. Servers would argue that because tips are variable and they assume some risk in working for them, they deserve the spoils. That’s very true at the low end, though also not as consequential, because the disparity between servers and kitchen staff is much smaller on the low end of dining.

At high end restaurants, with educated wealthy clientele, average tip percentages are rarely below 18%, and in some cases, I know many average slightly above 20% because the experiences are so extraordinary. Servers at those places might argue that the reason tips are so high is strictly because of the service, but when’s the last time you said, hey I need to go to that restaurant because I hear they have kick ass servers? It’s a good bet you’re going because you read about a sweet dish from awesome chef X, which is likely prepared by a brigade of overworked and underpaid line cooks. Subconsciously, there’s no question most diners at this level are tipping well because they ate well.

I think this makes for an argument for some kind of shared pooling system to honor the contribution of the cooks and support staff. Doing so, might even free restaurants so they don’t have to spend as much of their working capital on kitchen salaries, and they might be able to lower food prices or provide better overall dining experiences.

Though the reason cooks tend to work such ridiculous hours now is because one way restaurants compensate for the low margins earned on food is by hiring less staff than they really need. I’d bet even if they had to pay less in labor costs through such a system, prices on menus probably wouldn’t drop much.

The problem of creating such shared system is that federal department of labor rules state: Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements, such as dishwashers, cooks, chefs, and janitors.

There is a way to legally create a pooled system, though, and that’s to charge a flat service fee. A service fee is not considered a tip, and allows the restaurant to share the fee however they choose within the infrastructure of the restaurant. That’s the model that Per Se in New York follows.

The main complaint about such a system is that it robs the diner of the ability to award great service or punish bad service. Generally speaking, there may be a gaffe or two, but in my experience there’s no such thing as bad service at places like Per Se, Alinea, or Charlie Trotters.

Another problem is that technically the restaurant can do whatever it wants with such a fee, and there’s no guarantee anyone will see the return in salaries. Though I would guess high end places would disburse honorably.

The other problem with a service fee is that now in the diner’s mind a fixed meal price that used to be $200 just became $240+ with a 20% service fee. The psychological barrier of being compelled to pay a higher price, even though you were probably going to do so voluntarily is tough to get past, and could hurt a restaurant or cause customers to flock elsewhere.

Likewise, servers would rebel, because such a system would likely depress wages and reduce the amount they used to earn. Though, as I mentioned, I believe cooks have gotten stuck with the short end of the stick for years, and an adjustment needs to occur to honor their contribution and create better overall working relations.

My argument is not to reduce anyone’s wages though, and so I might even suggest a higher mandatory service fee if people can’t make a fair wage. On the other hand if a server who used to make 80,000 now makes 60,000 and a cook moves up to 50,000 as a result of such a system, it’s tough to argue that someone’s not receiving a fair wage.

Ultimately, I think what Borrelli’s article and my summation here address is that diners should understand where their dollars are going and what they’re buying when they dine out. Assuming restaurants aren’t making money hand over fist and just not taking care of their employees, there is some responsibility on the part of the diner to ensure a healthy restaurant industry.

I realize, in such a poor economy, everyone’s worried about their next move and every dollar spent. The idea of accepting any kind of burden of responsibility is really tough to swallow. On the other hand, as a freelance food writer who tends to make more in the ballpark of a line cook than a high end server, I still support paying slightly more, tipping a bit more, or encouraging a shared pool if it helps improve service, food, and ultimately the livelihood of those workers. It’s an easy proposition for me, because the work I’ve seen the workers in this industry do is extraordinary and also extraordinarily hard and I believe they deserve it. Of course, we all do.