Forward-thinking restaurant owners also have other reasons for eliminating tipping from their establishments. The Chicago Tribune noted that female servers sometimes feel they need to endure unwanted sexual advances from customers if they don’t want to lose their tip. Restaurants in some states can pay servers a subminimum wage as low as $2.13 an hour. Owners are required to make up the difference if tips don’t bring a server up to minimum wage at least, but that doesn’t always happen. Also, tipping is unfair to the “back of the house” – the people who work in the kitchen and don’t receive tips directly from customers.
The no-tip policy has gone over well among his employees, Fehribach told the Tribune, and customers are mostly OK with the change, too. Diners pay a 20 percent service fee in lieu of a tip. This enables Fehribach to pay his staff $18 to $25 per hour.
The no-tip movement does have its shortcomings. Pete Ternes, who owns a pizzeria and brewery in Chicago, told the Tribune the higher wages he’s paying will force him to schedule fewer servers for each shift, which could mean slower service. Derrick Tung, another Chicago pizzeria owner, said he worries about retaining the best servers unless every restaurant in Chicago goes the no-tip route. As he put it, “Why would a great server come work for us if they can go down the street and make double or triple?”