Why The ” No Tipping Policy” Is A Really Bad Idea

For quite a while now, there have been murmurs among restaurateurs about implementing a ‘no tipping policy’ at their business. While those who advocate it may have their own reasons for doing so, it doesn’t quite sound like a particularly good idea for all concerned parties; for the owners, customers, servers, the hospitality industry and the society in general. Here’s why

Servers

It would be foolish to believe that the primary source of income for servers and attendants comes from their basic wages. Most servers make twice the money from tips than what they earn as salary. So even if they were to be rewarded with a pay hike in line with the fundamentals of a no tipping policy, it is unlikely that they would make as much money as they otherwise would.

 

Owners & Hospitality Industry

Raising the salaries would usually demand a 20-25% hike in the prices of all things on the menu. This would obviously lead to a drop in sales. Add to that the prospect of ‘talent drain’ that may arise with an outflow of people from the industry and you are faced with a double whammy!

 

Customers

Customers not only would have to pay more for their meals, they would also have to bear with an inferior quality of service. The prospect of a healthy tip drives servers to serve customers better. Take that motivation out and you know what would result. And that’s without even mentioning the talent drain factor.

 

Society

Servers tip out a hefty percentage to the back bar staff, the kitchen staff and other employees. A no tipping policy would mean that all these people lose out on the additional income they previously made. This may negatively impact their purchasing power and their standard of living. And that is bad news for both the society and the economy.

 

While things may change in the future, at the moment it seems like the no tipping policy would do more harm than good.