Per Se ends tipping in favor of service charge

[JohnL]

I am a 20%.

I will add to that for especially helpful service (out of the ordinary--help getting a window table or accomodating a special request-extra this or that--or if my party has presented any difficulties for the restaurant-a late show etc).

There is no way that wine service should be tipped at twenty per cent across the board --I will tip 10% of the wine in a fancy place and will add to that if the waiter or sommelier was especially helpful-above and beyond.

In a more downscale estrablishment I will tip twenty per cent of the entire bill wine included most of the time.

Having said this and having read the above posts--the cost of dining is the cost of dining. A customer pays for a meal and service. A restaurant can "bake" in the cost of the service as a "gratuity" added to the check or increase the cost of the food and pay their staff as they see fit.

This reminds me of the car biz--that "free maintenance" --well it ain't free! It is covered in the cost of the car price. You pay for it one way or the other.

so

It is up to the restaurant to establish how much it costs to eat there and we can pay for it or ---not.

It is up to the restaurant to determine how and how much their staff should be paid.

I do think that wine service in an upscale restaurant should not be included at twenty per cent--though even here I would assume that a restaurant can adjust their wine prices per bottle up or down as they see fit.

A lot of this is psychological--I do enjoy the convenience of my free maintenance--even though i paid for it when I bought the car. (an added benefit is people are more likely to have the maintenance done when it is "free").

I don't know what this has to dso with per se but I do eat in my car a lot (too much).

[west2100]

Personally, I feel these measures are fundamentally wrong with regards to the concept of the tip itself.

Pooling controversy aside, which I feel is an excellent idea, the idea of an automatic and required tip is quite the opposite of it's purpose. I am not an employee nor an owner/operator in the food service industry, I am a consumer. To my mind the tip is an expression of the patrons perceived value of the service itself. I pay a tip according to how I believe the service of the establishment has treated me. Poor service will gain far less from me than will a prompt, polite waitstaff. The idea of a fixed amount of tip completely negates this practice, and I feel like my opinion of the dining experience has been denied expression by disallowing the practice.

Knowing that an establishment partakes in this system gives it a seeming aura of arrogance in my mind, of not caring what the patron thinks, so long as the desired result of the experience, payment, is obtained. Greed appears to be the motivating factor in this practice, and I do not choose to endorse restaurants who endorse greed, idealistic as that may seem, I would like to be able to express my opinion, even if it is in monetary form.

Edited August 8, 2005 by west2100 (log)

[slkinsey]

Let it be an anomaly; it is a gratuity, at the discretion of the diner.

Here's the problem with that: 90% of the diners at a restaurant are entirely unqualified to determine what is and is not under the control of the waitstaff, and may often penalize (or reward, although this is far less likely) the waitstaff for something that is not their fault.

I totally disagree Sam. If a diner has taken the time to get a reservation at Per Se or any other top-tier restaurant, then said diner knows how to tip and knows when a problem is the waiter's fault or not.

Sadly, I think this is not true.

[Fat Guy]

I'm not sure what the differences in French health insurance and culture have to do with whether or not a service charge provides better service than an open tipping system would. I think it's simply the case that you can have good or bad service either way. The fact that fine dining service in France is on the whole better than in the US is, however, a telling counterexample we can offer to people who claim that without tipping service automatically becomes terrible.

Except in atypical cases, such as where demand radically exceeds supply, any viable business where service of any kind is provided needs to have systems of ensuring good service and compensating customers for bad service. Tipping is one of about a hundred ways to achieve this, and it's probably not a very good one. Yes, it has a certain immediacy, but it doesn't really address the issues it should be addressing: again, you get bigger tips for bigger checks; better service is a secondary concern. Where tipping is truly a minor gratuity (as opposed to the actual wage, as it effectively is in the restaurant business), it may provide a slight incentive for better service (as it does in France, where people often leave a modest amount above the service charge for excellent service). But I don't think it really does here -- it is a totally common experience for waiters to haul ass to provide the best possible service and get a 10% tip from some cheap bastard. I see no reason to give consumers that sort of discretion when it comes to paying servers' wages. In businesses where there is no tipping, there are plenty of other ways to ensure good service, for example firing employees who don't do a good job, promoting those who do, offering bonuses, etc.

There are three main constituencies opposed to ending the tipping system: customers, servers and restaurateurs. So it's not likely to end any time soon. But Thomas Keller deserves a lot of credit for thinking way ahead of the curve. His goal "to further the establishment of a unified work culture within the restaurant" is an admirable one. It's how enlightened 21st Century managers think and speak. Bravo.

[Fat Guy]

Greed appears to be the motivating factor in this practice

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If anything, greed is what motivates opposition to the service charge.

[rich]

His goal "to further the establishment of a unified work culture within the restaurant" is an admirable one. It's how enlightened 21st Century managers think and speak. Bravo.

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The quote is terrific, admirable and forward looking, the problem is the environment in which it was said or written. I'm not convinced creating a communist system in the heavily capitalistic restaurant industry will work - at least not in the manner he's creating.

[west2100]

It is just my personal opinion that the cost of service should be included in the cost of the meal itself. I came to the restaurant to purchase one thing, an eating experience. Gratuity ( http://en.wikipedia.org/wiki/Gratuity ) is defined as an amount paid outside of the advertised bill or fee. The very idea of including this in the bill is contradictory to its basic concept.

[Fat Guy]

How is a service charge communism, Rich?

[JohnL]

I just don't think that diners should be in the position of "supplementing" "augumenting" whatever you want to call it--the salary of any employee of the establishment.

You pay the freight for a meal. The restaurant pays the employees.

In the end the customer can-reward the restaurant by returning, telling friends about their good experience, etc etc etc. (or giving the person a ten dollar bill --a real tip.

Or they can alert management re: bad service, and/or simply not return and/or tell friends about their bad experience.

Having to worry about --should I tip the captain (how much) should i tip the waiter (how much) should I tip the sommelier (how much) --what about the busboy? has everyone who served me been covered? what if they share tips?

It's just too much bother--especially in a high end establishment. Let's have one price dining no anxiety!!! (the sales of tums will go down!).

[rich]

How is a service charge communism, Rich?

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It's not the service charge that's communist, it's the pooling concept that is. The financial basis of communism is equality of wages, regardless of the competency level of said individual.

[Fat Guy]

Rich, teamwork is not communism. It is an essential part of operating a successful business at anything larger than the scale of a hot dog cart.

[rich]

Rich, teamwork is not communism. It is an essential part of operating a successful business at anything larger than the scale of a hot dog cart.

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But even with teamwork, some individuals are just better at a job than others. And in my opinion those individuals should be compensated accordingly.

When that "15% must" system was put in place, some waiters made significantly more than others - and that wasn't by accident.

[*Deborah*]

I'm not sure what the differences in French health insurance and culture have to do with whether or not a service charge provides better service than an open tipping system would. I think it's simply the case that you can have good or bad service either way. The fact that fine dining service in France is on the whole better than in the US is, however, a telling counterexample we can offer to people who claim that without tipping service automatically becomes terrible.

My point was that service is much closer to, or more often, a profession (paying a decent base wage) in France, with consequent pride in performance, as opposed to North America, where (again, in my experience), it is very often something one does for a short time, for quick cash, while attempting to become something else.

There are exceptions, of course.

[FabulousFoodBabe]

When that "15% must" system was put in place, some waiters made significantly more than others - and that wasn't by accident.

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A 15% gratuity is a tip for the waitstaff. A 15% service charge can be allocated as the management sees fit (including the owner's pocket). That's the way I understand it, at least in this state (yes, I worked for someone who billed my services, added a 25% service charge, and kept half for herself, half for the catering manager (???))

In a place like Per Se, the percentage the waitstaff makes is probably driven by the diner, not the amount of work that is done. And who here doesn't know at least one server who does anything for an extra dollar, even if it means extra work for others?

[divalasvegas]

Having read through all of these posts, and after much consideration, I vote for leaving the system as it is. While I do dine with large groups, often when I dine out it is usually with only one other person or alone. I have a bad feeling if servers are guaranteed 20 percent--not a problem with me since I'm a pretty good tipper--the lone, especially female diner may be given short shrift by servers who know that they can concentrate on those bigger tables and pad that 20%. To be fair, I generally do receive good service wherever I go since I treat the server the way I'd hope to be treated if that was my profession and not as my personal servant.

Also, although I've never worked in a restaurant, I'd like to think that I'm a pretty good judge of what is indeed in the server's control (getting my order wrong) and what is not (the pasta is well past al dente).

[Fat Guy]

Just because a total pooling or service charge arrangement leads to equal division of that money doesn't mean every server has to be compensated equally. In many businesses, all employees in a certain category might get the same basic wage, but there are often plenty of opportunities for better performing employees to distinguish themselves and either earn more or otherwise be rewarded. In a restaurant context, better servers can be given better shifts, more desirable schedules, performance bonuses, promotions, etc. Poorly performing employees can be placed on probation and, eventually, either retrained or let go. The rugged individualism of tipping is not the only means by which businesses have figured out how to reward better employees.

[Fat Guy]

My point was that service is much closer to, or more often, a profession (paying a decent base wage) in France, with consequent pride in performance, as opposed to North America, where (again, in my experience), it is very often something one does for a short time, for quick cash, while attempting to become something else.

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Chicken, meet egg. Egg, meet chicken. I don't consider it any surprise that a trade designed around the tipping system (which essentially makes servers into something very close to independent contractors) would attract exactly those people looking to do work "for a short time, for quick cash, while attempting to become something else." Whereas, it is also no surprise to me that a profession designed as a profession, paying a decent wage base, results in pride in performance and (in Thomas Keller's words) furthers "the establishment of a unified work culture within the restaurant."

[robyn]

Perhaps this is something that makes it easier for the restaurant to deal with the IRS. See this for example.. If so - makes sense from the owners' point of view. Who wants to spend hours - days - weeks - messing around with the IRS while it tries to reconstruct who got what?

BTW - I have zero problem with the 20% add-on. I am a 20% (pre-tax) person unless I get lousy service. And - if I get lousy service - I'm going to complain long before the bill arrives. Robyn

[TPO]

What other services are you allowed to pay for, after the fact, according to your whim? That doesn't strike me as a right; it strikes me as an anomaly.

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On the other hand, what other industries expect you to pay the salaries of their employees directly? Most businesses factor in their labor costs to the costs of the goods or services.

Restaurants, in my state anyway, are allowed to pay their servers around $3.00 an hour and we pick up the rest of their hourly salary. Tipping then becomes a necessity for that server to live on instead of a gratuity for good service.

So perhaps it should be a line item on a check, and called "labor" just like the charge for mechanical work. Then the restaurant, like an auto repair shop, could use that money to pay all of its staff a fixed hourly wage and do what they want with the excess.

(Edited because I can't type clearly or correctly tonight...)

Edited August 9, 2005 by TPO (log)

[lancastermike]

When I tended bar I wanted to work alone. When my bar got real busy managment would send some schlup back to help me. Mostly they got in the way. I was supposed to share my tips with them 50-50. I hated this and it certainly was no incentive to me.

I also did banquets and it was a total share which was fine with me. I doubt the servers at Per Se will be happy, but I have never worked at a place like that. If he wants to make it a fair share for everone just charge the price and pay folks. I doubt this would be an issue at Per Se, but I would worry that at some places that 20% would not all go to the staff.

[Chris Amirault]

Can someone give a basic overview of the service system in place at Per Se? If only one person greets, takes the order, serves, clears, and checks out each table, then the idea of rewarding individuals based on performance might make some sense. But if it is as I suspect -- a variation on a European model that emphasizes a team-based approach to service with a more relaxed style of interaction -- then the idea of rewarding individuals based on performance is nonsensical.

How, exactly, can a diner assess the performance of an individual who works by necessity as part of a team? As someone who runs a preschool, I know that the individual teacher who often receives credit for a "job well done" from a parent is merely one of many who have collaborated unselfishly to do that job. Just because the "consumer" doesn't recognize that team work is not justification for me to do the same.

This isn't communism; if anything, it's a version of maximizing efficiency as a team that Ford would find admirable. Even if it were communism, I'd agree with Steven: it sounds like Keller gets what it takes to manage a group of people so that they can take pride in their work together.

[JohnL]

I think the issue is not so much about a system per se (pun intended).

It is about control.

I wasn't sure where I stood as a diner/consumer but after reading through the thread I have learned a bit about the business of the restaurant and my thopughts/opinions have evolved.

I think Fat Guy hit on something--the currently accepted system does put waitstaff in the position of being "independant contractors" to a degree.

This means there are elements of their performance that are not under the command and control of the management of the restaurant.

For eg--there are a number of restaurants I have patronized over the years wherein certain waiters seemed to operate in their own world they seemed to have their own set of customers (my wife and I ask for certain waiters when we make a reservation/show up at the door etc).

A good example is the heyday of the Stage deli here in NYC where Max Asnas (a waiter) became "bigger" than the restaurant itself!

I now wonder if this is a good thing for the restaurant in the long run. Especially where somkeone like Thomas keller is attempting to to provide diners with "singular" dining experience.

I also feel that in many restaurants and for many years a chef was a chef responsible for the kitchen while the front of the restaurant was "handled" by a manager who managed the wait staff and rarely did the twain meet. (both probably worked for management and or an owner).

Anyway that is the impression I got/get.

With restaurants that represent or reflect a "vision"--the person who has that vision should be in complete control over all aspect of the dining experience--one would think.

[DTBarton]

I'm generally against any system that takes away the incentive for people to perform better. It always leads to a uniform level of low mediocrity.

Two specific examples. My first engineering job out of college was with Newport News shipbuilding. In the first 4 years I was there, it was well known that the raise pool was very narrow, everyone got between 2% and 3% per annum. This, as expected, did two things. One, everyone slumped towards that low mediocrity as there was no incentive to excel. Two, the good people who wanted to excel and be comensated for their efforts started leaving the company in droves for greener pastures. I had one foot out the door when the company announced that the top 10% of performers (as rated in their annual reviews) were going to be recognized financially. I got a 23% raise the 4th year and stayed on for few more years.

Second, and more applicable to the restaurant situation: My neighbors belong to a local yacht club, the most prestigous one. They have a policy in their restaurants of automatic 18% gratuity added to the checks. The service routinely stinks, inattentive, uncaring servers. We are good friends with the former executive chef, and he tried to change the policy to motivate the servers, couldn't do it.

[rich]

This whole concept of control could be a "slippery slope" with the end result being the loss of individualism and choice, not only with the staff but with the consumer.

At the far end of such an example a restaurant could just initiate a $1,000 per person charge and serve one meal with wine pairings - no tipping, no food choices, no wine choices - just what the visionary chooses to serve on a particular evening. Granted, an extreme example but certainly within the realm of possibility.

Keller can do anything he wants because it's his restaurant. Business-wise I don't think a mandatory 20% charge is wise in this country and most especially in NYC - we have the deserved reputation as being a people of choice.

The "pooling concept" has been tried in several shapes and forms over the years and in many industries and doesn't work. When you give everyone the same wage, regardless of performance, it eventually leads to morale decline - just the opposite of what Keller says he's is trying to accomplish. He may be a food guru, but obviously history isn't his strong suit.

PS - There are "teams" at Per Se, but one wait staff person has charge of a particular table, so service can and does vary from table to table.

And I think it's a very good thing for there to be a wait person of choice in a restaurant. It gives other staff members something to strive for, especially when it's clear that person makes more in tips because of her/his skill, pride and determination.

[Fat Guy]

Having worked at one of the world's top law firms -- Cravath, Swaine & Moore -- I can testify that at the Per Se of law firms everybody was paid the same, lock-step. Same salary, same bonus for every third-year associate, etc. Although ruthlessly capitalistic, the Cravath system was premised upon teamwork and esprit-de-corps -- many of its key components were inspired by United States Marines operations -- not on internal competition. We competed with other law firms. We didn't compete with each other. And the primary reward for doing good work was that you got to keep your job and every year you got more money. Eventually you had a shot at partnership, where compensation was also lock-step. There were other rewards for good performance as well, of course: you got assigned to better partners, you got to work on better cases, etc.

However, the notion of equal pay is a red herring. Nobody says servers need to get equal pay just because they share equally in a service charge pool or a tip pool. The restaurant controls several other parameters that can be used as rewards. It's quite simple to implement an incentive bonus program for servers who get favorable evaluations. Some shifts are more desirable than others. Extra hours are a commodity that can be doled out. And base salaries can be increased -- not everybody has to be paid the same; these amounts can range from the minimum legally allowable amount to $10 or $15 or more per hour. Of course, were the service profession less oriented towards the itinerant, there would also be long-term incentives, such as moving up into management, accumulating retirement benefits, etc. Since when did tips become the only way to reward employees?