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Phila. eateries climbing on no-tip trend

If diners leave a tip at the just opened William Street Common in West Philadelphia, servers are supposed to return it, saying "You left something behind," said owner Avram Hornik.

Brittney Majnerick at William Street Common. (Ed Hill/Staff Photographer)
Brittney Majnerick at William Street Common. (Ed Hill/Staff Photographer)Read more

If diners leave a tip at the just opened William Street Common in West Philadelphia, servers are supposed to return it, saying "You left something behind," said owner Avram Hornik.

A 20 percent service charge has already been added to each check, and that money - plus a match from the owners - first goes toward paying salaries: All employees earn at least $15 an hour.

Hornik, who also owns Drinker's, Union Transfer, and Morgan's Pier, admits that this model might not work for every restaurant or bar, but he is trying to create a different model here, a space where patrons can linger without feeling pressure to leave and all employees are fairly paid, even if the tables don't turn over quickly.

The long established practice of tipping for good service is starting to be questioned - at a few restaurants around the city and around the country.

It has long been accepted that most restaurant servers can be paid below the federal minimum wage - in Pennsylvania, tipped employees receive at least $2.83 hourly - because the difference will be made in tips.

Some of the country's finer dining establishments, such as Per Se in New York, have removed the tipping question by adding a service fee or by increasing set menu prices to cover the loss of gratuity. But that's not the norm.

A gratuity-based business unfairly tips the economic scales toward servers and away from those who prepare the food, says Steve Laurence, a founding partner of Vegan Commissary on East Passyunk Avenue, where a service charge is figured into the bill, patrons are not expected to tip, and employees start at $10.75 an hour.

"When we were planning this and looking at ways to pay people and other sustainable things, we decided we wanted to make sure people could live on their work. You shouldn't have to have a full-time job and then another full-time job to survive."

Research by the New York-based nonprofit Restaurant Opportunity Centers United, which advocates for higher wages and better conditions for restaurant workers, shows that tipped workers are three times more likely to live in poverty than others. And - cue ironic music here - about one in seven tipped worker receives federal food assistance, the group says.

Yet industry watchers, such as National Restaurant Association Vice President Scott DeFife and Culinary Institute of America Provost Mark Erickson, said the ability to influence one's pay based on performance is one of the elements that attracts people to tip-based jobs.

"Our research continues to indicate that the vast majority of consumers take a positive view of the practice and custom of tipping for service that has evolved in our industry," DeFife said.

Desiree Podulka, a veteran of the restaurant business with 17 years as both bartender and server, said she prefers working for tips. Last summer, she worked as a bartender at an establishment that paid her $16 an hour, no benefits and no tips expected. That model was OK during the summer, when people were away and volume was low, but she left as soon as September hit. She now serves at the Happy Rooster in Center City.

"I work well and have a good following that comes back to me. I'm here for customer service and I like to make other people feel happy and welcome," she said. "When you get a salary, some people might not go that extra mile because they know they're getting what they're getting."

Steve Cook, one of the Cook/Solo partners behind the restaurants Zahav and Federal Donuts, said his company looked into moving to a service charge-based model. He'd seen research that showed most customers don't tip based on service. Instead, "People tip what they're going to tip," he said.

And there were other considerations: A service charge would bring more parity between the front of the house crew and those in the back of the house. Servers would have pay stubs that showed they had a steady income if they wanted to buy houses or cars. Factors beyond anyone's control, such as the weather, wouldn't mean an employee had a bad night.

After running the numbers, Cook/Solo decided not to change its model. For now.

"I'm not saying the conversation is over. We wanted it to be an overwhelming win for everybody so we could say, 'This is what we're doing. It's a big change. There's no question you'll come out ahead,' " he said. "But the differences with taxes and other burdens on the restaurant would be beyond what we could absorb."

At William Street Common, after wages and bonuses are paid, how the remainder of the money is used will be determined by the employees, Hornik said. They could decide on sick leave, health leave, perhaps even a cellphone plan. If the model works - and the restaurant has made its number since opening this month - he said he would consider applying the model to other restaurants.

But, he stressed, "it's not a one-size-fits-all" model. Such a service charge probably wouldn't work at a high volume bar, he said. But William Street Common aims to be coffee-shop-like, where patrons can come and sit for hours: "We want to create a place that allows for what we call 'social conversation,' where people feel comfortable and the barriers for connecting are eliminated," he said. "The theory is that will get people to come back, maybe multiple times a week, and employees will want to be here and feel connected."

Cristian Mora, co-owner of Girard Brasserie and Bruncherie, which recently opened with a no-tip-necessary policy, bumped up prices to ensure that no worker makes less than $11 an hour; $13 is the average. Besides health benefits and days off for illness or vacation, the restaurant is also offering employees the option to join a profit-sharing program.

Brasserie server Katie Breen said tables generally leave her tips of 5 percent to 20 percent, despite the restaurant's policy.

"I made decent money, tip-wise, but it doesn't really matter," said Breen, 31, a 12-year service industry veteran who works 35 to 40 hours a week.

Although Breen said she earns slightly less at Brasserie than she has at past server jobs, she thinks the trade-off is worthwhile. When she first announced she was taking the job, one acquaintance said she was crazy because she'd be losing money. Many others, though, thought differently: "I have friends in the business who have said, 'Let me know if anything opens up. I'd love to get into that place.' "