Lessons learned from a flat-rate service-charge, no-tip restaurant

Jay Porter owned a San Diego restaurant called The Linkery where tipping was not allowed; instead, a flat 18 percent service-charge is added to each bill, and that charge is divided among the servers, bus-people, and kitchen-staff. In a six-part series, Porter sets out the case for his experiment and reports on the result, covering the bad gender dynamics, motivation and microeconomics, and a comparison with a tip-friendly restaurant he also owns. It's a compelling tale about economic fairness versus locked-in dysfunctional conventions. He summarized his findings in an easily digested article for Slate.

Probably the most common reaction to our service-charge-no-tips policy, from people outside the service industry, was along the lines of, if there’s no tipping, then how will the servers be motivated to do a good job?

When you step back and think about this for a second, it’s actually kind of hilarious. The person asking this question would have a full-time job as a software developer, or lawyer, or journalist, or doctor, always working to a pay rate that was negotiated ahead of time. We would never suggest that a code jockey or surgeon would be motivated to do better work by the thought that their clients, if pleased with the service, might toss in a few extra dollars.

And yet, we restaurant-goers (and I include myself in this, in the days before I worked in restaurants) are not hesitant to suggest that, unlike all other working Americans, restaurant servers are a class of simpletons who require a drip of money every few minutes to keep them on task. By perpetuating the idea that servers, and servers alone, won’t perform without the threat of pay withheld, we dehumanize our neighbors and peers who work taking care of us. I think this helps us not feel bad when we sometimes treat them badly. It’s the Stanford Prison Experiment meets Yelp.

Meanwhile, restaurant workers know what’s up. People who worked in the restaurant industry wouldn’t ask us this question — what will motivate servers to do a good job? Because, inside the restaurant, we know that while the customers think their tips allow them to control the server, in fact the control is illusory. The story of the server being motivated by the customer’s power to tip, is instead a fiction created to make the customer feel important.

This was one of the first things I learned as a restauranteur.

Observations From A Tipless Restaurant: Part 1, , part 3, part 4, part 5, part 6

What Happens When You Abolish Tipping [Jay Porter/Slate]

(via Kottke)