DULUTH, Minn. – Customers at the Northern Waters restaurant in the Mount Royal Shopping Center never leave a tip on the table - and general manager Greg Conley hopes that becomes a trend in Duluth restaurants.
“It is an outdated, and occasionally dangerous, financial model that expects that the burden of a livelihood should fall to the whim of the general population. We value our servers. We know they will provide quality work. We are paying them for it,” reads a card explaining the no-tipping policy given to customers with their bill.
Northern Waters implemented the no-tipping policy at its new restaurant on Woodland Avenue when it opened in February. The price of the food reflects higher wages - and also includes tax - and the policy promotes pay equity between the servers and cook staff, Conley said.
“It allows us to pay our employees what we think they’re worth rather than depending on our customers to supplement a low wage that we would start out paying them, because that’s typically how a tipping model works - you pay your server as little as you can or a very small amount and hope you get enough business in tips that it will guarantee a better wage,” Conley said.
Any tips left by customers are donated locally. Northern Waters plans to rotate among nonprofit organizations for the donation; at the moment, donations are going to Damiano Center.
Tips can cause friction between a restaurant’s servers and the staff who work behind the scenes, Conley explained.
“You don’t have that pull between the front of the house and the back of the house that some places have, where the server comes in and works for a few hours and makes a ton of money and then the guy in the back that’s been working all night doesn’t make much money and depends on those servers to tip him out so he can make a good wage,” he said.
The staff has had a great attitude about the no-tipping policy, he said. Implementing the policy creates an environment where the restaurant’s staff work more collaboratively together.
“They feel valued. They don’t feel that crush of, if we have a slow night at the restaurant, are they going to make their rent for the month,” he said.
On the flip side, servers aren’t making the money in tips that they would if the restaurant was packed with customers. However, slow nights and nights with a lot of customers eventually balance out, while the no-tipping policy provides a more consistent wage that the staff can depend on.
The policy has gone over well with customers, he said. Although supportive of the idea for the most part, it’s taken some education for customers who may have a bit of a sticker shock when they see higher-than-expected prices for food, Conley said.
What it comes down to is paying Northern Waters’ staff a living wage, he said. American society treats restaurant jobs like a transitional job, but it’s a lifelong career for many people, Conley said. The change in its gratuity is part of a larger push by Northern Waters that includes offering benefits such as health insurance and paid sick time to its staff.
“We really view this as a career and so we want to make the wages accordingly,” he said. “It’s worked out wonderfully. We retain really great people, and we get the best of the best as far as staff goes.”
The trend of gratuity being eliminated in favor of higher prices has become a popular practice in larger cities on the east and west coasts and has started to gain ground in the Twin Cities, Conley said.
Delta Diner in rural Bayfield County implemented a no-tipping policy last summer and instead adds a 20 percent staffing charge. The restaurant pays its adult staff a minimum of $15 per hour. The diner’s management said last summer that it was stopping the tipping practice so its staff could have more pay equity and earn a more consistent wage.
A change in the tipping policy at the Lazy Moose Grill in Moose Lake and the Lazy Bear Grill in Barnum in 2014 created a Facebook firestorm. Several iterations of a no-tipping policy were attempted - one policy lasting a day before it was terminated - and customers can now leave a tip on top of the tip already added into the price if they want to.
In researching the no-tipping policy, Conley said Northern Waters management learned that it’s easier to implement it from the first day a restaurant opens rather than change it after a restaurant has been open for a while.
Conley said he hopes the trend takes off in Duluth because it is a transparent way to pay employees and makes the employees feel valued.
“We’re not depending on customers to make them feel valued. We’re saying, ‘You deserve this wage, and we’re going to pay you that consistently,’ ” he said. “You have a lot of people in a restaurant that work hard and I don’t think just a certain few of them deserve to make a ton of money. I think everybody should be paid a decent wage.”