Over the past few years, restaurants across the U.S. have begun eliminating traditional tipping. Businesses have instead opted for service fees and, in some cases, dynamic pricing to cover employees’ salaries.
Now, a question being asked is, could the removal of tipping actually lead to cheaper dining experiences for customers across the nation?
The End of Traditional Tipping
Tipping has been an integral part of the dining service across the U.S. for the past century. Yet, this could be set to change.
After the COVID-19 pandemic, businesses began trialing new practices that aimed to reshape the industry, including the implementation of dynamic pricing and the removal of traditional tipping.
Fresh Approach to Service Fees
In an attempt to eliminate the cost of tipping, some restaurants have found success in introducing mandatory service fees.
These help ensure front-of-house staff are paid a fair wage without forcing customers to tip.
Not All Customers Agree With a Service Fee
Service fees won’t work in every establishment, however, as many customers have become accustomed to tipping in accordance with the service they received.
Forcing diners to pay a mandatory service fee regardless of the service may result in severe backlash and could even lose businesses a portion of their loyal customers.
How Restaurants Will Pay Servers Without Tips
Nonetheless, if restaurants continue to eliminate tipping, they will have to be forced to find an alternative means of ensuring servers are paid fairly.
As paying staff members a higher wage could be deemed too costly, some restaurants have developed fascinating initiatives to ensure workers are paid more without forcing customers to tip.
South Park Restaurant Implements Big Changes
Casa Bonita, a restaurant in Lakewood, Colorado, made famous under the command of “South Park” creators Matt Stone and Trey Parker, has implemented a significant change in that it no longer accepts tips.
However, to offset the cost, the restaurant has begun issuing tickets, according to the University of Colorado Boulder.
Ticket Prices Don’t Make the Experience Any Cheaper
For anyone wishing to experience the live mariachi music and the revered food of this Colorado restaurant, the tickets will cost around $40 per adult and $25 for a child.
While this helps eliminate the cost of tipping, it doesn’t significantly reduce the price of a meal. In fact, some have argued they would end up paying more if this practice was implemented everywhere.
Colorado Professor Happy With Elimination of Tipping
Speaking with CU Boulder Today, professor Jeff Zax shared his thoughts on the removal of tipping at places like Casa Bonita.
“Tipping is the dumbest form of compensation there is. I think the economy would be healthier without it altogether, and I’m very encouraged to see that at least some businesspeople are coming to understand that. I’m glad Casa Bonita is doing it, and I wish all restaurants did,” he said.
Tipping Will Never Fully Disappear
Toward the end of the interview, the professor was asked whether or not there will ever be a day when it is completely eliminated from the U.S. service industry.
Zax replied, “I certainly hope so! But I don’t expect it. The practice has been surprisingly persistent.”
Dynamic Pricing Aims to End Tipping
In an attempt to eliminate tipping yet keep revenue at an all-time high, which would allow restaurants to pay workers more, businesses have been experimenting with dynamic pricing.
This involves increasing menu prices during peak hours, such as the weekend, or simply when demand is high. While it’s worked successfully in some instances, many Amercians argue the practice is unfair.
Restaurants Swap Tips for Other Fees
Even with the elimination of tips, restaurants will be forced to implement service fees, tickets, or dynamic pricing to ensure the front-of-house staff is paid fairly.
However, waiters and servers might prefer the idea of a consistent wage instead of relying on diners’ generosity each shift.
Will the Elimination of Tips Really Lower the Bill?
Whether or not the removal of tipping will help lower the average diner’s bill is still up for debate. But it seems unlikely.
Service fees and dynamic pricing will most likely take the place of tipping in restaurants that decide to eliminate the practice. This means we won’t save that much in the long run. But, we will be contributing to a fairer industry for the servers.
