Joe's Crab Shack has decided to give this no-tipping thing a shot, making it the largest chain to take up the call to pay its staff a fair wage.
The seafood restaurant chain has been conducting experiments to see if this no-tipping policy should be expanded across its 130 restaurants. CEO Ray Blanchette reported to analysts that, so far, the results have been promising. “What makes us optimistic is the restaurant that has been in test the longest is gaining the most traction,” he said. So, the chain has decided to expand experimentation to 18 of its Joe's Crab Shack restaurants.
If all goes well, Joe's Crab Shack would join restaurant influencer Danny Meyer, head of Union Square Hospitality Group, who just announced a few weeks ago that he was doing away with tipping in his restaurants.
“We’re really leading in our industry with regards to [a] national brand going out and testing this thing in a meaningful way,” said Blanchette. “So we want to be somewhat cautious.”
Customers who visit the 18 participating restaurants will notice increased menu prices to compensate for paying its workers a fair wage. The company hopes this policy will not only increase business, but also reduce turn-over rate among its staff.
“It’s very different to quit a job where you make, say, $14 an hour than it is to quit a job where you are making $2.25,” Blanchette said.
Many customers will likely not mourn the change in policy. But as far as business goes, Jay Porter, owner of The Linkery in San Francisco, said he switched to a no-tipping policy, applying a straight 18 percent charge to all bills.
“Our service improved; our revenue went up; and both our business and our employees made more money,” he wrote in an article for Quartz.
Kabir Sehgal, author of Coined: The Rich Life of Money and How Its History Has Shaped Us, explains the falsities related to tipping, like how well we're served has nothing to do with how we tip. In fact, he says the weather might be a better predictor of how big a tip a server will get.
“So the whole confusion of how much to tip — you're not actually the one making the decision; it's your subconscious that's making that decision for you.”
Natalie has been writing professionally for about 6 years. After graduating from Ithaca College with a degree in Feature Writing, she snagged a job at PCMag.com where she had the opportunity to review all the latest consumer gadgets. Since then she has become a writer for hire, freelancing for various websites. In her spare time, you may find her riding her motorcycle, reading YA novels, hiking, or playing video games. Follow her on Twitter: @nat_schumaker
Photo Credit: Maureen Sullivan / Contributor/ Getty