William Street Common is a new restaurant in Philadelphia, and is getting publicity for, we are told, experimenting with a different and (maybe?) fairer compensation model. Owner Avram Hornik pays all of its employees, from the servers to the dishwashers, at least $15 an hour plus paid sick leave and health insurance benefits. There is a 20 percent service charge for drinks, and that goes into a common fund that makes that $15 an hour wage affordable. Money left over at the end of a pay period is divided up among employees based on a point system related to various factors.
Hornik came up with this structure, he says, to deal with the well-debated problems of tipping. “Some people just tip the same amount, but some people base it on how quickly the food was there, whether we were out of something, whether the server was there when they wanted them to be,” he says. “So much of that is out of the control of the individual server… So why would it be fair for the service employee to be responsible for the poor decisions of management?”
Hornik argues that his model “essentially creates a guaranteed floor. But we’re also capping the ceiling,” he points out, because the tipping gets shared equally with all employees. “We didn’t think it was fair [that] in some places you have dishwashers earning 10 dollars an hour and the bartender earning 30 dollars an hour.” He also is convinced that the customers will benefit. “That atmosphere among the employees, a sense of community and empowerment and happiness with the job, is going to translate into a better environment for customers,” he said. “By having happy staff customers are going to be happier too.”
Is this system really fairer than the current one? Progressives are cheering it, because it represents a “living wage,” or at least something close to it. OK, but it would be nice not to feel hyped: ThinkProgress, for example, had headlines that the William Street Common “got rid of tipping” and writes “tips aren’t mandatory.”
Inept reporting or lies, take your pick. A 20% “service charge” is a mandatory tip, so tips ARE mandatory. The reports don’t explain how voluntary tipping has been eliminated, or whether a server would be prohibited from keeping a ten-dollar bill that a diner hands him, saying, “You know, the food was lousy, but you were so gracious and accommodating that you single-handedly made the evening bearable. Thank you. If I ever come back, it will be because of you.” If so, is that fair? I don’t think so. In fact, it’s exactly as unfair as a diner not rewarding excellent service, and tipping a dime. Continue reading