Newly Opened Raleigh Brewery Does Away With Tipping, Will Pay “Living Wage”

As we all know, going Woke tends to not help a business thrive and survive. This one is giving it a shot

North Raleigh brewery ditching tip system for livable wage salaries

unintended consequencesRestaurants might be open and allowed to serve more customers, but it doesn’t mean they are back to normal.

Heyday Brewing in north Raleigh opened up about eight weeks ago. General Manager Harrison Lassiter says they are trying out a new method to pay staff.

Employees here don’t get tips, instead, they make more than double the state’s minimum wage.

“A lot of excitement over the place, the community that we have here has been really excited,” Lassiter said.

One of the first things you’ll notice when you walk in is a sign that reads, “a 15% living wage service fee will be included on every check.”

So, they’re paying workers $15 an hour, but, not giving them tips. But, oh, there is a required tip, which supposedly offsets the doubling of wages. So, guess what? There are still tips. But, will that 15% offset that massive rise in wages? Or, will we see the prices rise? Maybe the owners will take the hit. They say it is strictly going to pay for labor, but, something has to take the hit to a doubling of labor costs.

“We were upfront when they signed up with us,” he explained. “It’s a different model. A lot of restaurants in this industry, especially in Raleigh, are playing around with different models and I think everyone is trying to figure out what’s best for them right now. So far, I think our employees have been completely open to it and enjoying it.”

Will the patrons get the same service that a tipping system creates? Maybe I’ll see one day, since it is rather near work. I had no idea there were even businesses in that area, thought it was all development for homes. The menu is short, but, then, I suppose it’s mostly about the beer. They do want $7 for hushpuppies, $13 for a pork BBQ sandwich, so, that’s rather above normal prices. I wish them the best, but, it might not last long.

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11 Responses to “Newly Opened Raleigh Brewery Does Away With Tipping, Will Pay “Living Wage””

  1. Kye says:

    It’s their option to try it out but as a restaurant/tavern owner for 37 years I can say that any good bartender or server would never work without tips. I’ve had waiters who made $700 on a 4 hour shift, and bartenders who did $1200 in tips a night. Consistently. So what this will attract are the low end of service employees. The kind who should really be janitors or porters and not rely on tips. We call them “McDonalds Employees” in the industry.

    BTW, wages need to be kept under 25% of gross to be profitable. Doubling wages as wonderful and magical as that sounds will completely erase all profit which is around 10%. An owner without income becomes an owner without a business in short order.

    • dachs_dude says:

      Exactly. I ran restaurants both corporate and owner operated for years and know what the profit margin is as the store level.
      Another point, is that tips are mostly in cash and as such tend to be very underreported as income. This will come as a shock to those who used to pocket lots of cash each night.

      • Good points both. And a lot of the lazy workers won’t be interested in applying, and those who do will still be lazy, because right now, as we’ve all read, many people are just opting out of going back to work.

        And good workers will go elsewhere, thinking they can make more on tips.

        • Kye says:

          Exactly! Do you think they want to make $20 an hour or $30 per table? Hell, an average server can turn six four tops in 90 minutes which convert to about $120 in ca$h. On weekends and holidays your star servers will pull at least $200 per hour. They make more than the Head Chef or the GM.

      • Professor Hale says:

        With deference to the experience of Kye and Dachs, I would love to see a society that does not allow tipping, as in Japan. Workers are expected to give their best effort without added inducement from the customer. Management is expected to dismiss poor performing staff or train and supervise them better and pay them what the labor market demands. But that is the ideal. Having a government that doesn’t encroach on personal liberties at every turn is ideal too, but here we are.

        The whole point of tipping a staff member is that they are making sales on a commission basis and by the MANAGEMENT giving them a percentage of the sale, they are incentivized to sell more and more of the things that have a higher margin (like drinks). Of course, in America, no one actually does this or even understands the point of it.

        Despite my personal philosophy on tipping, I tip well, especially at lower priced venues since in America, that is how we pay our staff. I’m less generous at expensive venues since the waiter at high end places work no harder than the one at cheap-steak franchises for the same service.

        The way we do things here creates perverse incentives like waitresses who share their tips getting preferential treatment by bartenders when management would prefer all their waitresses get the same treatment. And bartenders overpouring drinks to increase their tips from customers are in effect stealing from the management and being rewarded for that theft by the customer.

      • Professor Hale says:

        The sweet spot between annoying customers with tips and shortchanging servers with “living wages” is for management to include the “tip” in the price on the menu (not added at the end) and to pay their staff on a commission basis, so from the staff point of view, they are still getting a percentage of the sale, just not a bonus for rack display or overpoured drinks.

  2. Hairy says:

    Teach how many years ago were you trying to frighten all of us by telling all of us that Obama’s EPA was going to put all craft beer makers out of business ?

  3. Dana says:

    Hey, it’s an independent business, and has every right to try this!

    Mrs Pico and I went to the Olive Garden in the Richmond Centre shopping center on Monday. We had to wait twenty minutes to get a table, not because the place was so crowded, but because they were so short staffed and couldn’t get any help!

    If the picture came through, this was the dining room in which we were seated. If it didn’t come through, you can see it here.

    • Kye says:

      Are those ordering kiosks I see on each table?

      BTW, a restaurant this size needs to gross at least $50-60 grand a week to stay open. Looks like they’re coming up short.

    • Professor Hale says:

      Staff shortages are common in my area too. It seems many service workers make more staying home than going into work.

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