Bridging the Opportunity Divide

Here’s How a No-Tipping Policy Actually Allows Workers to Earn a Fair Wage

January 22, 2015
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Here’s How a No-Tipping Policy Actually Allows Workers to Earn a Fair Wage
Most servers in the U.S. earn a very low hourly wage and must depend on tips to make a living. Justin Sullivan/Getty Images
A Pittsburgh eatery is the latest to end the practice of leaving a few bucks on the tabletop.

Could this be the tipping point?

Bar Marco, a restaurant in Pittsburgh, Pa., has followed the footsteps of eateries in New York, San Francisco and Kentucky and has done away with tips.

Starting April 1, all employees will receive a $35,000 salary, health benefits as well as shares in the business, the Pittsburgh Post-Gazette reports. Staff will work a maximum of 40 to 44 hours a week, have 10 paid vacation days and get two days and one night off a week. Any tips that are left to the servers will go to charity.

The average tipped worker is notoriously low paid. For example, the base rate for tipped workers in Pennsylvania can be as low as $2.83 an hour. And a report from the White House says that the average hourly wages for workers in occupations where tipping is widespread (i.e. servers, hospitality industry, taxi drivers) are nearly 40 percent lower than overall average hourly wages. These workers are also twice as likely to experience poverty, with servers almost three times as likely to be in poverty.

Tips can also vary drastically between servers. According to a Freakonomics podcast, studies show that “blonde, attractive, slender, large-breasted waitresses in their 30s” consistently receive more gratuity than servers who are a different race or look different.

The biggest opponents of tipping also wonder why it’s up to diners to make up for a waiter or waitress’ meager paycheck — especially since the custom is practically unheard of in most countries. “Why is it our responsibility to pay the restaurant’s employees humanely?” says comedian Adam Conover in a recent video from College Humor (see below). “Why don’t they just pay [servers] a normal amount of money, and make the food more expensive?”

MORE: Meet the Restauranteur Who Pays Her Employees a True Living Wage

The announcement of Bar Marco’s wage change has been widely praised since the story broke (and led to a flood in job applications). Critics have argued that the staff is actually getting shortchanged since it’s possible they could earn more if they received tips. But kitchen worker Csilla Thackray worked out that the change means an additional $400 a month in her pocket. “It’s a huge increase,” she says to Business Insider. “It means that I no longer have to live with that constant fear of running out of money.”

To make up for the salary hike, diners at Bar Marco can expect some higher prices on the menu, and its 10-seat wine room will go from two seatings a night to open reservations, according to the Post-Gazette. CNN reports that the business will also save money by buying whole animals instead of individual cuts and make their own sausages and pickled vegetables.

“We’ve done a year’s worth of homework for this,” co-owner Bobby Fry tells the Pittsburgh CityPaper of his three-year-old restaurant. “Our greatest risk is that we do not take care of the people who make Bar Marco so special.”

For restaurants that can afford to put more money into wages, it seems like a noble model to follow. As it turns out, perhaps the best tip is no tip at all.

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