Colorado Restaurant Experts Weigh Pros, Cons Of Skipping The Tip

July 29, 2015

Colorado Public Radio

A handful of restaurant owners across the United States are telling customers to skip the tip. They’re hoping to lead a revolution for better pay, and maybe benefits, for their wait staff. Rather than having customers tip, these restaurants are testing other models —  like adding a mandatory 20 percent surcharge when the check comes to the table. Abrusci’s Italian restaurant in Wheat Ridge, Colo. implemented the idea about a week ago, said co-owner Nancy Progar, which has allowed full-time wait staff to receive salaries.

“We’ve been watching the restaurants in the bigger cities going non-tipping — albeit just a few — but we’ve been watching that trend because we feel like it’s going to be more than just a trend,” she said. “It’s going to happen for most of the country. And both my husband and I came from corporate America… So it’s hard for us to watch these kids that work for us kind of live from paycheck to paycheck because of the tipping model.”

Progar added that she thinks the change will be good for her restaurant’s bottom line.

But longtime PR expert John Imbergamo, who works with some of Denver’s top restaurants, warned against calling this a trend. Of the state’s 10,000 to 11,000 restaurants, he could think of just one other that does not have tipping.

He also suggested that waiters and waitresses may not strive to be their best without a tip to motivate them.

“Tipped employees get a report card every time they pick up the check on their meal and if that report card is a guaranteed B, then they’re, I think, less likely to strive for great service,” he said.

An expert in hospitality, H.G. Parsa, the University of Denver’s Barron Hilton Professor of lodging management, spoke with Colorado Matters host Ryan Warner about tipping.

Parsa on why restaurants that eliminate tips should just raise prices:

“You go to the restaurant, you look at the menu, and when you got the bill: a 20 percent surcharge, and tax on it. You get sticker shock. And once you know sticker shock, you may not go back.”

Parsa on how to lower tips in America:

“In this country, only 20-30 years ago, tipping was barely 5-10 percent. Then 15 [percent], then 18, 20, now it’s become  21, 22. In Europe, all the wait staff, they get good wages. In Germany, for example, they will say, ‘Round up.’ That means they round up to the closest euro [instead of giving a hefty percentage].

Parsa citing research:

“Sometimes people’s demographics affect how much tip they get or they don’t get — race and gender, for example.”