Newspaper article The Canadian Press

Tipped Out: Gratuities May Be Changing in the Hospitality Industry

Newspaper article The Canadian Press

Tipped Out: Gratuities May Be Changing in the Hospitality Industry

Article excerpt

Should tipping come off the menu?


TORONTO - Restaurant owners are grappling with the thorny and complex issue of balancing the huge discrepancy in income between servers and kitchen staff created by the current practice of tipping.

Front-of-house staff generally receive a gratuity of between 15 per cent and 22 per cent while cooks who make the food may labour for minimum wage.

"The truth is labour costs are going up, minimum wages are going up, restaurant margins are going down, and so in order to close that gap and keep people working in the kitchen, restaurants are going to start taking control of that tipping revenue as a way of just making sure they can continue to meet labour costs," says Mike von Massow, a professor in the department of food, agriculture and resource economics at the University of Guelph.

The issue of tipping differs depending on the industry sector -- fine dining, casual or quick service.

"And even within the certain sectors -- we've done some surveys and whether to move to a non-tipping model or not -- our industry is split almost evenly on the issue," says Mark von Schellwitz, vice-president for Western Canada for Restaurants Canada, who is based in Vancouver.

"There's certainly no consensus on which way to go."

Proposed models include a hospitality charge, profit sharing or a hybrid plan in which there's a moderate increase in pricing along with a small service charge.

"I'm very much in favour of cooks and waiters and all restaurant employees making a living wage, which many of them don't at this time," says Anthony Bourdain, host of "Parts Unknown" which airs on CNN.

"Is the no-tipping, service-included plan the way to get there? I don't know. I'm open-minded about it. I tip 30 per cent. Everyone should, in my view, but absent that, I suspect it's the future."

Dining chain Earls launched a 16 per cent hospitality charge in July at its 67th location, in downtown Calgary, to test the waters.

Craig Blize, vice-president of operations says the experiment, which the company will begin to evaluate in January, has been "polarizing."

"A lot of our staff love it. Our kitchen staff definitely loves it and our support staff loves it and the majority of the servers do as well," says Blize, who is based in Vancouver. "There have been some staff that have been disgruntled or haven't liked that option so we have moved them to other Earls where we do have tipping." There are no plans to roll the policy out to other locations.

Meanwhile, some guests love the all-inclusive charge while others "despise" it because they feel they've lost control over recognizing the service they've received. Earls.67 will waive the hospitality charge if a client is displeased with the food or service.

But evidence suggests people don't vary their tipping much whether they've received good or bad service, says von Massow. …

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