Philadelphia Cafe Keeping Server's Tips For Themselves?

There’s a war of words going on in the comments of a restaurant review in Philadelphia’s City Paper. Someone claiming to be a server has outed the Arbol Cafe for confiscating server’s tips. In response, someone claiming to speak for the cafe defended the practice, claiming that they need the tips to pay for their renovation.

The “servers” comment:

The owners of the Arbol cafe do not allow their workers to keep their tips. While getting paid 7 dollars an hour to bus, clean, set, take orders, run food, do dishes, and bleach bathroom/floors, the tips from customers are kept by the owners. Tipping the owner is considered rude and telling servers that they can’t is poor practice.
After a four hour shift (28 bucks) with no tips, which one time a server made 30 dollars in tips I was unable to keep it.
The place has all the potential, but has bad policies. NEVER TIP! Your server doesn’t see it.

The “cafe” responded:

We regret and apologize at having to respond to such a base, unfair and inaccurate comment made by the waitress, “John Smith”. The cafe has been open all of three months and is undergoing drastic rennovations. Prior to our hiring any person, we make it quite clear that they will be paid above minimum wage to start. It is also our clear intent to not have waiters or waitresses but rather, persons who are interested in working and growing as a team and excelling in the project’s full potential. Many of our customers have offered their time and skills, free of charge, because they too share in the same spirit of what we have to offer to the community.As newcomers into the Northern Liberties community, we feel a true responsibility to complete a project that is long overdue. A quaint cafe with attached garden seating. Our goal is to bring to the community a relaxed, casual, family atmosphere where tipping is optional for the customers and not needed by the staff. All money generated goes towards financing the rennovations as well as aiding us in being able to pay the workers well above minimum wage in respect to their ability and contributions.We want to thank everyone for their support, generousity and interest in Arbol Cafe. This is a true gift that has been placed in our hands and we vow to remain true to our purpose and sincerity no matter the resistance from those we may never be able to please. Our vision is clear and exspansive, we do hope that you will know Arbol Cafe first hand and understand how the impossible can be overcome against all odds. Thank you again and we apologize for any doubts that may have surfaced, yet we are certain that our heart, actions and intentions are whole and just.

This response doesn’t seem to be going over very well with City Paper readers:

wowwww the fact that you would even attempt to justify this must be one of the most pathetic things I have ever heard. I have been here a handful of times and enjoyed the atmosphere but knowing this my friends and I shall make sure never to step foot into this place. I gave my waiters healthy tips because they were nice and did a great job, not because I believe my food was worth more than menu price. disgraceful

and:

Profit sharing arrangement, Serious Please? What % share of Arbol does a worker receive? When you’re at any restaurant or cafe with table service, and you receive the bill from the server, it’s an assumption that the tab goes to the house and the tip goes to the server. If patrons knew tips were being seized to benefit the house, people likely wouldn’t tip.

If the owners provide the bulk of the service, they’re more than welcome to put their tips back toward the house, but operating under the myth that a server is somehow eventually ‘profit sharing’ in the ‘enterprise’ is the sort b.s. that I was now the exclusive province of Internet startups trolling Craigslist for content producers.

Even the claim that they’ll pay minimum wage at the expense of tips belies their knowledge that the value patrons perceives in a server collectively exceeds minimum wage. Arbol’s exploiting that assumption to benefit themselves.

Other posters got it right, there’s no way Arbol will be able to maintain servers in Philly’s or even Northern Liberties’ restaurant worker market.

If true, is this legal? Judging by what’s been going on in California with Starbucks, it may not be. (We obviously are not experts in Pennsylvania law, so who knows?) Would you tip if you knew that the server didn’t actually get the gratuity?

UPDATE: And in response to this post, Arbol Cafe wrote us:

Arbol Cafe does give tips to the employees, and was giving tips at that time ‘John Smith’ was in training. John Smith was in training and she received $25 for each of her three, 3 hour shifts. We opened in January and she worked a few days in February. If people think that we do not tip employees, they are only feeding off of one of our first employees in training as well as repeat bloggers/posters who now seems out to slander us at every chance they have. While we can’t continue forever defending ourselves without further criticizim from people who like to post negative comments, we do feel that it’s important for our customers and future customers to know that our employees are, and have been, and will continue to be treated with respect and the tips have been, are currently, certainly will continue to be forwarded to them as they pass the training period and can competantly work the front desk.”

Thank You,
Beth

Arbol Cafe [City Paper] (Thanks, Maurice!)
(Photo:Tracy O)

Comments

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  1. hills says:

    It should be made clear to customers that the waiters are paid a fair wage and tipping is optional, and that tipping goes to renovations. Otherwise, it is stealing.

    Personally, I tip my waiter for good service, not to finance renovations unknowingly.

  2. coan_net says:

    Most of the time, waitresses are paid under minimum wage, which is legal since they in total normally make over the minimum wage once tips are included.

    I was a cook in a small “family” restruant at one time, and I remember bringing up the topic of why the waitress gets tips, but me as a cook does not. Well the owner gave me the option to (1) keep my pretty high rate of pay, or (2) go to the same rate as the waitress and they would “pool” the tips to share between the staff. Well I choose to keep my high pay.

    So if this place is paying the waitress a above normal rate in the first place, then I can see why tips would not be included. Of course the owners easy answer is to drop her rate of pay below minimum wage, and let them keep the tips.

  3. friendlynerd says:

    If this isn’t illegal (and I’m betting it is) it’s at least deceptive and smarmy.

  4. Whitey Fisk says:

    A tip is intended for the person (ie, server) providing the service. The fact that the cafe claims they “need the money” (seriously?) does not obviate that fact. Their “hey, we’re all in this together” defense is sad and laughable. Do we all get to share in the profits after the fact too?

  5. friendlynerd says:

    @coan_net:
    Sorry, no, that doesn’t work. Customers who tip servers are doing it with the idea that (most) of the money is going directly to the server. What little doesn’t go directly to them is getting tipped out to the other support staff who had a hand in making a good dining experience.

    Using your staff as a front to raise more money beyond the menu price and regular profit is deceptive. It will ultimately hurt business because your public face, the servers, hate your thieving guts.

  6. dwarf74 says:

    Legal or not, it’s completely scuzzy.

    If they need to pay for renovations, they should increase the prices on their menu.

  7. boss_lady says:

    @hillsrovey: I agree with you 100%. When I tip, I tip the waitress, not the restaurant or owner. I’ve been a waitress before, and every restaurant pays quite low (in Canada, we have “Waitress wage,” which is at least twenty-five cents below minimum wage)- the tips are supposed to make up for the smaller wage and the hard work you put in, running your ass off all day. Regardless of their attempts to clear up this ugliness, the point is that the cafe in question should have pointed out where gratuities would be going, to customers and to staff, prior to opening. It should be on display somewhere, for all to see, otherwise it feels totally dishonest.

    Furthermore, if they’ve only been open three months, why didn’t they get a bigger loan from the bank (or whomever), and just wait to open when the restaurant was completely finished?

  8. Chols says:

    Tipped employees are usually paid $2.13 in my state (Mississippi) and then they receive tips. If the tips they claim do not add up to the minimum wage ($5.15/hr) then the owner is obligated to reimburse them to that amount. Usually, they get way more than that, so it’s not a problem.

    I worked at a fast food place that brought the food to your table, and some people would tip. The owner then said that since we were getting paid above minimum wage, that the tipping was unnecessary and if you keep them it is stealing, and you will be fired. So we put the tips in a jar and bought pizza once a month (:

    Note: The minimum wage has gone up since then, but I’m not sure to what, just referencing what I knew for sure.

  9. AnderBobo says:

    Why would anybody willingly agree to work under those conditions? Under 30 bucks for four hours of waiting tables, bussing, cleaning bathrooms, running food, drinks etc. If they are so bold as to take the server’s tips, than they should be equally bold making a disclaimer stating that “tips do not go to the server but to the house”. This is really decieving the consumers thinking that they are awarding the servers for great service.

    Also, wouldn’t this promote BAD service considering the server has no reason to rack up a high tip?

  10. dorianh49 says:

    No, and if I ate there, I would probably get my food to go so that I wouldn’t have to tip. But I doubt I would eat there, on principle alone. Waiters and waitresses put up with enough crap that taking their tips… takes the cake.

  11. leprofie says:

    But … I’d rather pay the accurate price for a meal than the “hidden cost” of tipping. I want wait staff to be paid a fair wage and the cost of that included in the meal.

  12. SonicMan says:

    What about taxes. If you paid with a credit card how would it work out. Isn’t the waiter or waitress responsible for the taxes on that tip?

  13. yetiwisdom says:

    I’m not sure about PA but this practice is definitely illegal in NYC and a number of restaurants are being sued by their staff for back tips and damages, so Arbol better be careful.

    See
    [justiceatfiremangroup.com]
    [www.nytimes.com]

    I have a friend engaged in one of these suits and while I’m gemerally against litigation, the practice of restaurants claiming all or portions of tips is contrary to tipping custom and the assumptions upon which minimum wage for servers are based. I don’t like it. Not one bit. BOOO Arbol!

  14. Beerad says:

    Don’t know about specific PA law, but per federal minimum wage standards, you can hork all the tips you want as long as you’re paying the standard minimum wage. Many states have specific laws prohibiting owners/managers from taking employee tips altogether, which have been used in a spate of recent lawsuits on the issue.

    It may be crappy, it ain’t necessarily illegal. The point of tips is to make sure that servers get paid at least a minimum wage same as non-food service workers. And if the employees know that when they sign on, they don’t really have cause to complain (sounds like they are making at least minimum wage). That being said, I suspect the restaurant will buckle under the negative (albeit perhaps misguided) PR.

  15. Juggernaut says:

    Not to make a generalization but I bet the owner(s) smell of patchouli… and maybe Summers Eve because this is the douchiest thing I’ve ever heard

  16. Concerned_Citizen says:

    It boggles my mind why waiters and waitresses deserves tips for doing their job, but the cooks deserve nothing. The guy working at microsoft doesn’t get tips despite the fact you use the OS daily. I mean, come on. The whole tipping thing is obsolete in this day and age. Don’t tip and the opportunity for the business to take it all is lost.

  17. And I think we all KNOW its illegal in CA…*ahemStarbucks*

  18. Bladefist says:

    @Concerned_Citizen:

    I agree. I don’t see a problem here. Assuming they are telling the truth, they make it very clear to their employees what to expect. Most countries dont give tips to their servers, and just pay them. I would prefer this as well. I usually feel guilty about leaving a small tip for bad service, so its always atleast 15%. What is it my job to compensate their employees? I would prefer you just put a computer at my table for me to order with, or, let me go pick up my food myself from the back. And let me keep my tip money.

  19. ElizabethD says:

    Arbol has waded into a stinky swamp with this policy. Keeping tips is an unorthodox and probably unethical way to raise funds for facilities improvement.

    I have no idea if it’s legal, but it is clearly a deceptive practice.

    Arbol needs to have signs at each table stating their tip policy so that all diners are aware before they calculate a tip, if any.

  20. jesdynf says:

    Servers are making over minimum wage, so the price of the food represents all expenses, with none of these reprehensible hidden fees. I approve wholeheartedly, although it does sound like the restuarant needs some better signage explaining the policy.

  21. AnderBobo says:

    @Concerned_Citizen: Ummm have you ever been a server?! In most restaurants servers have a multitude of responsibilities, it isn’t just walking the food from the kitchen to your table. Often times they clean bathrooms, vacuum, bus tables, fold endless amounts of napkins, wash linens, etc. all so that your dining experience is pleasant. On top of that they serve as the liason between the customer and the kitchen staff. They also end up taking most of the blame if anything is wrong with the food/drink. It is a highly stressful job with which when done correctly has alot of responsibility with a bulk of income coming from tips.

  22. yetiwisdom says:

    @Concerned_Citizen and @Bladefist-미국사람: “Most countries dont give tips to their servers, and just pay them.” – This is true, and explains why in most countries service is pretty poor compared to American standards – service personnel have no financial incentive to perform. The tipping system is pay for performance at its finest. Try getting good service in Italy sometime and you’ll understand.

  23. Imafish says:

    I agree that the vast majority of resturant staff are paid under minimum wage because of their tips.

    I also agree with others that a resturant can pay their staff above minimum wage and eliminate tipping. If the workers don’t like it, they can quit.

    However, the deception here is to the patrons. The resturant is essentially stealing money from the patrons. Why would anyone pay more than the stated bill? You tip for quality service, not for renovations. If this is not illegal, it certainly should be.

  24. AnderBobo says:

    @AnderBobo: Sorry, having worked as a waiter this is a sensitive issue for me.

    I wanted to add, regardless if this is legal or not, it is highly deceptive to the customer. They are bilking the customer out of money plain and simple. I agree if they are in need of money to expand or whatever just up the food prices, but don’t expect donations from customers thinking they are tipping their server. Pathetic.

  25. friendlynerd says:

    @Bladefist-미국사람:

    Are they making it clear to the customers? Because they’re the ones really getting bilked in all of this.

  26. bzr_wzr says:

    @Concerned_Citizen: The cooks do not deserve nothing (sorry for the double-negative). Where I work, we are supposed to ‘tip out’ our cooks 10% of the tips we make, as long as we make $20+. Granted, this doesn’t always happen – some people are just too cheap. It’s only fair, though, that the cooks get more money for working harder just like we drivers do.

  27. Imafish says:

    “Try getting good service in Italy sometime and you’ll understand.”

    Heck, nearly anywhere in Europe.

  28. Jaysyn was banned for: http://consumerist.com/5032912/the-subprime-meltdown-will-be-nothing-compared-to-the-prime-meltdown#c7042646 says:
  29. D.B. Cooper-Nichol says:

    I can’t condone what the restaurant is doing – it’s stupid and tin-eared, more than anything.

    But the anonymous waitress is no hero, either. She’s cool with taking the much-higher-than-typical-for-a-server hourly wage, then whines about not getting tips? Assuming the owner was up-front when she was hired (logical, I think, given the wage), she’s not the victim she’s portraying herself as.

  30. Imafish says:

    “sorry for the double-negative”

    You should only be sorry for a double-negative when your intent is a positive.

  31. boss_lady says:

    @Concerned_Citizen: Okay, then I suppose you’d be in favor of at least minimum wage for servers and kitchen staff… this pay increase to them would be delivered to the consumer by way of much higher food and drink prices.

  32. NeoteriX says:

    @yetiwisdom:

    Your market theory would work, that is… until servers took tipping for granted and expected a tip even though the service sucked :)

  33. unravel says:

    “It is also our clear intent to not have waiters or waitresses but rather, persons who are interested in working and growing as a team and excelling in the project’s full potential.”

    This sounds more like a cult than a cafe, and I cannot shake the mental image of them dragging bodies out, all sporting the same sneakers and death shrouds, somewhere down the line. If I was a customer, I’d be terribly irate and feel like I’d been stolen from. The servers may be earning ‘well above minimum wage’ but honestly, I don’t leave tips _because_ those running an establishment may be too slimey to insure those busting their asses for that establishment take home a ‘decent’ wage, I tip because the person that has served me deserves it, in my mind.

  34. MasterShake says:

    $7 an hour is not truely a living wage for anyone other than teenagers or those with a second source of income. Waiting tables can be a tough way to make a living. I recently worked a 13 hour shift and walked, after tip-out, with $250 in tips. at $7 an hour that wouldn’t even break $100 for a very long and active day. Everyone should, at some point, work for tips. It makes you appreciate that when you go out to eat you get two services: food preperation and delivery/cleanup so realize that they are seperate charges – the delivery/cleanup is not included in the price of the food. Keeping them seperate incentivizes good table service.

  35. andrewe says:

    That is some sad pay.

    Here in Manitoba the minimum wage is over $8 an hour. The servers are guaranteed this plus they get to keep all of their tips.

    Having a separate wage for people who earn tips is akin to thievery in my book. It’s the exact same thing as the owner swiping tips off a table. I think this is a disgusting practice and I’ve never been a server.

  36. Shappie says:

    Isn’t the minimum wage in the states $7.25 anyways?

  37. Rectilinear Propagation says:

    Would you tip if you knew that the server didn’t actually get the gratuity?

    Hell no.

    I don’t care how much the waitstaff is making: If I decide to tip it’s to give the money to them, not the owners. Restaurant owners should not be able to take money I give to a waiter or waitress.

    This restaurant ripped off customers by not telling them that they take tips away from their staff.

    You want to run a restaurant where waitstaff is paid enough not to need tips? Fine. Awesome even. But not telling your customers this is unethical even if it isn’t illegal.

    @unravel: I agree it sounds very much like a cult. Why is the cafe referred to as “the project”?

  38. erica.blog says:

    Whether or not the servers were in on the deal when they were hired, who knows. But I really doubt this was ever explained to the average customer — who paid a 15%-20% surcharge on the listed menu price to fund this place’s renovations and Team Building Experience.

    BAD restaurant.

    Presumably they’re doing this by not turning over funds in the “tip” line of the credit card to the server, so this is an argument to tip in cash to prevent unethical businesses from skimming — this is the first I heard of a restaurant that kept ALL the tips, but I’ve heard of places that kept a portion.

  39. MeOhMy says:

    If it is not made perfectly clear to the patrons that this is a “tipping optional” place and that any tips collected go to the capital improvement fund instead of the waitstaff, it’s totally misleading.

    The patrons are expecting their tips to go to the waitstaff (and may or may not tip the same if they knew where it was really going). The waitress is also part victim because she knows that her patrons are leaving tips believing that the money is going to the service staff…sounds like the pimp business model to me!

    While there might not be a law a la California that prohibits management from taking a cut (or all) of the waitstaff tips, if there is not clear signage explaining how the tips are managed, then basically the owner is misleading the patrons to entice them provide extra money for capital improvements. That sounds like a separate crime which starts with “F” and rhymes with “schmaud.”

  40. Blueskylaw says:

    persons who are interested in working and growing as a team and excelling in the project’s full potential (with no mention of compensation)

    All money generated goes towards financing the rennovations as well as aiding us in being able to pay the workers well above minimum wage in respect to their ability and contributions (this is the gotcha statement, guaranteed that everyone who works there will not be working up to their ability or be substantially contributing to their work)

    and understand how the impossible can be overcome against all odds (are they building a cafe or trying to save the crew of a sunken submarine?)

    This is a masterful response obviously not written by the owners but by a political speechwriter.

  41. Blueskylaw says:

    .

  42. vladthepaler says:

    Makes you wonder why anyone would agree to waitress there. But, given that people do agree to waitress there, knowing they can’t keep their tips… it’s their choice. People have a right to work under conditions that I myself would not agree to work under.

    I do think the restaurant has an ethical responsibility to tell customers where the tip money is going, however. And informed consumer might then opt to leave a nice note, or something of non-monetary value, for the waitstaff as a tip.

  43. r081984 says:

    I am with the owner on this one.

    Those servers are not in tippable positions as they are making $7.00 an hour.
    Those servers knew before they were hired they would not be getting tips.

    If people complain the owner should say no tips and if anyone takes a tip they will be fired.

  44. dorkins says:

    The restaurant is clearly saying that they’re trying to create a non-tipping atmosphere by paying more than minimum wage, and trying to create a better-than-just-waiters opportunity for their staff. That’s laudable, but yes, the tips should go to the waiters.

  45. dorkins says:

    Oh, unless the servers did know that they weren’t getting tips.

  46. friendlynerd says:

    @r081984:

    PA minimum wage is $7.15. So if they’re making $7 and getting their tips confiscated, then that’s illegal.

  47. Beerad says:

    Just an observation for everyone who’s indignant at the restaurant for not informing customers: assuming that PA does not specifically prohibit this practice (or whatever state you’re in – I tried to do a tiny bit of research on PA but came up empty) you do realize that this could be happening everywhere you go, right?

    Many places force tipped staff to pool tips, split them with other staff, or sometimes pocket them outright (coat checks are a good example — they aren’t protected in the same way as food servers, so very often that money goes right to the house). The money that you put down to reward someone for service doesn’t mean it’s going to end up in their wallet at the end of the day, and it probably happens more often then you think. Not to justify the practice, but it’s out there, and unsurprisingly NO establishment is going to tell you about it.

  48. unravel says:

    @vladthepaler: I’ve yet to see evidence that people know they can’t keep their tips when they agree to waitress there (notice the owner said ‘Prior to our hiring any person, we make it quite clear that they will be paid above minimum wage to start’ – but there’s nothing about making it quite clear that staff won’t be permitted to keep tips).

  49. JohnnyE says:

    All the talk of everyone pitching together “growing a team”, “completing a project”, and “financing renovations” had me waiting for equally communitarian statements of democratic/participatory management and especially some mechanism of equity and a profit sharing.

    Instead, it just turned out to be more like “Pull hard together, comrades! Only we can build my business!”

  50. Bladefist says:

    @yetiwisdom: Well, it doesn’t really work here. I get terrible service all the time. I must look cheap or something, because, honestly, 9 times out of 10, the service I receive is terrible. The incentive, is to keep your job. In america, if the server performs poorly, most people just tip low, or not at all. But a lot of people just dont tip, so the message to the server, is not clear. Was it bad service, or just a cheap ass? In korea for instance, the manager would be contacted, and couple of those, and you would be fired. That would be the message.

  51. Kasey620 says:

    EXACTLY what I was going to say. From the PA Labor and Industry website:

    What is the Minimum Wage in Pennsylvania?

    “Minimum wage in Pennsylvania is $6.25 per hour effective January 1, 2007. The rate will increase to $7.15 per hour effective July 1, 2007. Employers with the equivalent of 10 or less full-time employees calculated on a 40-hour week can follow a different rate schedule. Click here for complete details on Pennsylvania’s new minimum wage requirements.”

    So this whole “[we] pay the workers well above minimum wage” is an outright lie.

    They are lying to their guests, their employees, and giving MY neighborhood a bad name. Northern Liberties has the reputation of being very neighborhood and community based, and Arbol Cafe is out of place with these kind of illegal and immoral practices.

    Shame on Arbol Cafe.

  52. oldheathen says:

    I’m sure the IRS would be quite interested in Arbol’s unique vision of accounting.

  53. TPK says:

    Legal… Not legal… To me this story is primarily about yet another stupid business who hasn’t yet figured out that whatever they do must now hold up to the scrutiny of public exposure.

    Judging from the comments on that article, they will be forced to rescind this policy and beg the public forgiveness if they have any hope of staying in business.

    They are fast on their way to becoming “that restaurant that steals tips”.

    Yay for light.

  54. AustinTXProgrammer says:

    I feel this restaurant is defrauding the customers.

    Tipping can lead to better service, but what if you go to a restaurant more than once. You get good service the 1st time and return. If you get lousy service on a repeat visit you are stuck. If you properly adjust the tip you might never be able to get good service on repeat trips. If you tip well anyways you don’t create an incentive for the staff to improve.

    We should get rid of tips. If the service sucks talk to management. If is great you can also let management know. It should be up to the restaurant to keep the service levels high so they can get repeat business.

  55. I agree that the Restaurants owners are sleazy, but not because of the fact they confiscate tips. If indeed the servers get paid Minimum Wage+, AND are told in advance that Tips are house property they have nothing to gripe about (well any more than ANYone stuck at minimum wage).

    The issue here is that the CUSTOMERS are being bilked out of the tips.

    The restaurant owners need a sign clearly stating that:

    “Due to wages paid in this establishment tips to the wait staff are not asked for nor expected. Any tips left will be assumed the property of the restaurant.”

    That’s the exact sign I saw once, and I thought it unusual to I asked about it. That’s when I learned that in many states wait staff are allowed to be paid significantly less than minimum wage due to Tips.

    To those of you who “Never tip” I don’t expect you to frequent any one establishment long enough to be considered a “regular” since probably if you do the wait staff treats you poorly (or at least doesn’t do more than the bare minimum to keep you from complaining).

  56. parabola101 says:

    BOOOOOO for ARBOL CAFE! Wouldn’t they HAVE to claim the money they steal from their employees as taxable income? Or do they just take the sizable credits off their taxes? I don’t think this would be so so bad if they company divided some of its profits amongst the employees. Like a year end or 6 month bonus or something like that? But their response is a delusion — pure crap!! I will make it a point NOT to go there!

  57. That's What She Said says:

    Having worked in the service industry, I have always thought tipping was a poor idea for a bunch of reasons. I think it’s unfair to burden the customer with paying the staff, and I think it’s unfair to the wait-staff because their efforts aren’t always directly related to their pay (ex. Waitress gives awesome service and is stiffed by a customer).

    I’ve never understood why a wait-staff position wasn’t treated as more of a sales position, with a low base + commission of sales from the owner. It seems it would be simple to eliminate tipping altogether, bump up the price of the food to include a commission rate, and have the wait-staff be truly accountable for their sales.

    This seems like it would be a win-win-win. Customers wouldn’t feel obligated to figure out how much to tip, wait-staff would know that their efforts were directly in line with their pay, and owners would benefit because wait-staff would be motivated to sell and up-sell. Owners want us to do that anyway, and I don’t think it would be too high-pressure for a customer to be in a restaurant that works that way.

    I imagine it would be too difficult administratively, or something, otherwise this model surely would have been adopted. As someone who waited tables, I would have profited much more from this arrangement than the helter-skelter method of “who knows what I’m going to make tonight, and it doesn’t really matter what I do, I can’t REALLY control it!”

  58. That's What She Said says:

    By the way – this restaurant is totally in the wrong, though. They handled this situation terribly.

  59. Geekybiker says:

    I don’t really have a problem with what they are going, given that its disclosed. I appreciate the concept of a tip-less restaurant, with servers actually paid a fair wage. I dont really think the waitress has a complaint here. She clearly knew the score when she started. The customers are the ones possibly getting screwed.

  60. unravel says:

    @r081984: To hell with the owners here. If one’s laying down money with the intent to ‘reward’ an individual for the service they’ve provided, the owner has no right to take it all away and put it towards other costs… unless that policy’s been defined and patrons are made aware of it.

    I’ve worked in places where tips were ‘frowned upon’ — there were notes on the menus, and signs posted on the walls that spelled the policy out. When offered a tip in such a place, we were told to politely decline.

    Seems like the owners here are content to rip both their employees & their customers off. They’re doing nothing to discourage tipping, and reaping all the benefits of tips that weren’t left for them. I have no problem with split tips (in certain situations), but this is slimy, and it’s wrong.

    @Rectilinear Propagation: I can’t believe I missed ‘the project’! Sounds like somebody really huffed the paint fumes as they were prepping for opening. I bet they don’t serve soup and sandwiches but “experiences”, arrrgh.

  61. muddgirl says:

    It may not be illegal, but it’s definitely scuzzy if customers aren’t informed before-hand that their tips are not being kept by the wait-staff.

  62. Ex_EA_Slave says:

    Sounds like this person never worked at a restaurant before. I delivered pizzas in college and got paid the ‘server wage’, $2.15 an hour plus tips. This is pretty standard in all states. Quit bitching and get a job as a real waiter if you want to make money.

  63. jamesmusik says:

    It doesn’t particularly matter if it’s against Pennsylvania law. It’s against Federal law already. From the DOL:

    “Retention of Tips: The law forbids any arrangement between the employer and the tipped employee whereby any part of the tip received becomes the property of the employer. A tip is the sole property of the tipped employee. Where an employer does not strictly observe the tip credit provisions of the Act, no tip credit may be claimed and the employees are entitled to receive the full cash minimum wage, in addition to retaining tips they mayshould have received.

    Service Charges: A compulsory charge for service, for example, 15 percent of the bill, is not a tip. Such charges are part of the employer’s gross receipts. Where service charges are imposed and the employee receives no tips, the employer must pay the entire minimum wage and overtime required by the Act.”

    Sounds like they need to start charging a service charge if they want this to be in any way legal. Even then I’d say it’s morally questionable.

  64. gleason says:

    There are two issues here:

    1) As long as employees are told of the policy beforehand, the employees are not the victims here.

    2) I can vouch that customers are NOT told of this policy in any way (via signs or a blurb on the menu). THIS, to me, is the key issue here; not the employee/tax issues.

    I should, however, clarify that Arbol Cafe only has about 5 small tables and rarely are you ever served by anyone besides the owners. Most $$ transactions occur at the cashier rather than the tables. But, in the event that a customer is indeed served by somebody other than the owners and the customer feels compelled to tip for their service, this is where I have a problem with their lack of notification. I think most customers assume that a tip will go directly to their server and not funneled to management. A customer should be allowed to make a decision whether they still want to tip given the policy. But this is only possible if the policy is made clear, and it is not. That’s the problem that I have with it.

  65. Fly Girl says:

    In Washington, the minimum wage for tipped workers is the same as the minimum wage for all workers– $8.07 per hour.

    It’s not unheard of for waiters and waitresses (at nicer joints) to make up upwards of $10.00 an hour for their base wage. And they get all of their tips on top of that.

    I tip well, mostly out of guilt/social pressure, but I don’t necessarily believe in it. I mean, if I work all day at my job that pays me $10.00 an hour to (insert up-tipped, but skilled, job here) and then I go to a restaurant and the worker is making the same base wage as I do in an UNSKILLED profession, why should I tip?

    I mean, any job that deals with the public is a “service industry job” but only some of them get tipped. Why don’t we tip grocery store clerks and the UPS man, but we do tip our taxi driver and the waitress?…

    In a previous life, I was a social worker and my roommate was a waitress (at a mid-range joint). She made nearly double the money I did. Something is wrong with that.

  66. Fly Girl says:

    Not that I don’t think this restaurant owner is a total skeeze– they should be hung out to dry. Especially if they’re in a state with lower base wages for waitstaff, regardless of what they were paying their employees.

    When people tip, they assume that money is going directly to their waiter/busboy/hostess, etc… If it’s not, that needs to be disclosed up front. Anything else is nothing short of fraud and theft.

  67. kable2 says:

    The waiters should get the tips from those that choose to leave them. Then again I dont usually tip anyone, so the house wouldnt have gotten anything from me anyway.

    They should put up a sign “tipping free zone, please dont tip”

  68. bonzombiekitty says:

    I live a few blocks away from this place. The servers do make more than minimum wage and it is supposedly a deal between the servers and the owners. which in and of itself I am fine with. But my big problem is the policy is not posted in the cafe so they’re taking advantage of their customers.

    There’s been a large discussion in this issue on the message boards for the neighborhood, with some additional comment from the owners of the cafe.

    http://pub50.bravenet.com/forum/4226496069/show/627264/1

  69. bonzombiekitty says:

    @kable2: You’re a cheap bastard.

  70. bohemian says:

    WTF? That is the weakest argument for stealing tips I have ever heard. They tried to make it sounds like opening a restaurant was some sort of community charitable endeavor. It is a business, in this case one that is ripping off the staff.

    Can anyone who works as wait staff answer this? If I tip and pay both in cash are you more likely to not have your tips stolen by the restaurant vs. paying with a credit card?

  71. metaled says:

    For all those that don’t believe in tipping. (please don’t side-trip on illegal immigration)

    3 weeks ago, Sunday front page LA times. Hand car washes and illegal aliens. It’s estimated that 90% of the car washes in LA don’t pay the employees at car washes. They work for tips ONLY. The pool their money and sleep packed into one room apartments. Often working a year before becoming a “towel boy” to accept tips. One car wash owner (3 car washes) has been caught multiple times (from whistle blowers), ends up in court and pays as little as a $17,000 fine. (which doesn’t go to the employees!) Cheaper than paying the employees. A legal car wash owner stated it is not possible to operate a car wash in LA and pay employees a minimum wage, do the math for costs and there is no way for them to stay open. And these guys who dry off your car in 100 degree heat, working for tips only, still come out way below minimum wage. Can you imagine working that hard all day in this heat and only having $20 bucks to show for the work. (those that do pay employees pay only $1.63 an hour!) for doing 300-700 cars a day!!! How about working extra hard while the car owner watches in hopes of a larger tip, just to be snuffed because they think you make enough on minimum wage?? !!!!
    I don’t believe in illegal immigrants or in exploitation of them, so you won’t see my car in a hand wash, car wash while I suck down a $5 Cafe-mocha, then only tip $1 as I hop in my shiny clean car. Only machine wash or even better, the kid down the street will make a few EXTRA bucks for doing it for me!

    (note, data was inserted from memory for point of example, see actual story for exact amounts, I believe the figures are much worse than I stated!)

    [www.latimes.com]

  72. Namrepus says:

    ok as a PA resident I should speak up here.

    PA state minimum wage for tipped employees is $2.83 an hour. If this place is paying $7 an hour, they are infact, paying well above minimum wage for tipped employees.

    Checking the Pennsylvania Department of Labor and Industry website this is how the minimum wage law here works

    “The minimum wage credit for tipped employees will remain at $2.83 per hour. However, an employer will have to make up the difference if the employee’s tips and the $2.83 per hour do not meet the full Pennsylvania minimum wage listed in FAQ 1 [in this case $7.15 per hour]. The tip credit applies only if an employee received more than $30.00 in tips during a month. If an employee does not receive more than $30.00 per month in tips, the employer must pay the regular minimum wage.”

    By them removing the tips entirely, they are shorting the employees 15 cents on a legally mandated wage.

    Which regardless of how “good” it might seem to the employer is wholly illegal

  73. silenziatori says:

    @r081984: There is no upper limit on how much a tipped employee can make. Just because they’re receiving $ 7.00 per hour does not mean they automatically forfeit their tips. In Pennsylvania, the MINIMUM a tipped employee can earn is $ 2.83 per hour, as long as the amount in tips they receive results in the employee earning at least the minimum hourly wage rate.

    Look here for more info:

    [www.dli.state.pa.us]

  74. silenziatori says:

    @friendlynerd: The PA minimum wage is currently $ 7.15 per hour for employers with 10 or more full time employees. If this cafe employees less than 10 full time employees, then their obligation is to pay their employees at least $ 6.65 per hour. Beginning July 1, 2008 the cafe will be obligated to pay their employees at least $ 7.15 per hour.

    Here’s more info:

    [www.dli.state.pa.us]

  75. WraithSama says:

    @Chols:
    I call BS on your employer. Just because you make more than minimum wage doesn’t make it stealing if you accept a tip. An employer has the right to make it official policy for employees not to accept tips (which some do), but they can’t accuse you of stealing money which never belonged to the company to begin with.

  76. ragold says:

    @Beerad: The point of tips is NOT to meet minimum wage. It’s an old tradition that goes back a lot longer than minimum wage laws in this country. And for those of us who live in states that don’t screw service industry workers by setting even lower minimum wages, it’s patently false.

  77. Mina_da_mad_child says:

    I don’t understand how people can say the server does nor deserve tips because they are paid above the minimum wage.

    Their base pay is irrelevant. They are service workers in an industry that receives tips. The same as your hair dresser, barber, or door man.

    As has been previously mentioned, the tips are property of the waitstaff and management has no right, legally nor morally, to take them to improve their business. The “whistleblower” should be commended, even if she agreed to this situation if only to inform others of the practice before accepting employment from this establishment.

    The stupidity of business owners never fails to amaze me

  78. nroberts says:

    In Seattle’s U District, the owners of the 2 student-favorite Indian places (Cedar’s and Taste of India) are known to pocket tips as well. The servers all make a decent wage (or so I’ve heard), but all tips go to management/owners. Both restaurants are famous for having super-attentive staff, but if you don’t tip well you get blacklisted and the great service immediately turns to crap.

    What’s horrible is how GOOD the food is. Between the service and the food, it’s hard to justify not tipping – especially if both will get worse once they recognize you as a bad tipper.

  79. BII says:

    @SpiderJerusalem:

    That remains to be seen on appeal. The arguments and facts that led the decision weren’t accurate at all.

  80. Comms says:

    Fuck the cafe. As one of the respondents put it, the house gets the tab. I am paying the house for the food or drinks I ordered. The tip goes to my server.

    That’s great that they pay above minimum wage but that doesn’t entitle them to the tips.

  81. lesbiansayswhat says:

    Does anyone know where the ‘tip’ culture originated? Seems to me that we should abolish it, ala europe, and make businesses start paying decent wages not ‘waitress wages. There will always be cheap people who don’t tip well. And there will always be generous people who feel a connection with their server enough to slip them extra few bucks.

    Either way, this whole tip thing really doesn’t work. I suspect that patrons started it themselves and businesses/government started using that homegrown generosity of strangers to justify paying their employees less as if that patron money was automatically part of what the place pays their employees. The logic of it all doesn’t make sense unless you’re Mr. Moneybags.

  82. BigElectricCat says:

    This is violative of Federal wage and labor standards. If this is actually happening, and if the restaurant is paying the subminimum “waitress wage,” then the restaurant is in violation of Federal law. In addition, if the restaurant has been confiscating tips and not reporting them a business income, then they would also be liable for taxes and penalties on any unpaid/unreported/underpaid/underreported business earnings derived therefrom.

    OTOH, if the restaurant is not paying subminimum wages to its waitstaff and is retaining tips, then there’s no legal violation. That said, keeping the tips without telling the customers about it is a pretty lousy thing to do. In such a case, I’d stop going to the restaurant and I’d tell the owners why.

    And maybe send them copies of receipts from other restaurants I had eaten at in the last 30 days, just to give them an idea of what they’re missing.

  83. PaulMorel says:

    Sigh. I have no problem with the owners’ policy, AS LONG AS THEY MAKE IT CLEAR TO THEIR PATRONS!! If it’s clear to the patrons that tips don’t go to the staff, then fine. In that situation, I would never tip. If the restaurant thinks that its food is worth more than the prices on their menu, then they need to raise their prices. Otherwise, they are basically stealing from their servers, and from their customers.

    This would really piss me off if I was a customer at this place. I think I would go there and ask for all my tips back.

  84. subterrene says:

    @Concerned_Citizen
    @Bladefist
    Does this sound familiar?

    “I don’t tip because society says I have to. All right, if someone deserves a tip, if they really put forth an effort, I’ll give them something a little something extra. But this tipping automatically, it’s for the birds. As far as I’m concerned, they’re just doing their job.”

    …So what are your bank heist codenames?

  85. jayw7 says:

    @Concerned_Citizen:
    I’m a waitress and you not tipping is not going to make the owners pay me more than 2.50$ and hour… it just makes you a jerk. if you can’t afford to tip you can’t afford to eat out. no one cares if you don’t like it.

  86. nsv says:

    I tip to let the server know my opinion of their service. I’ve left tips from 7 cents (all the pennies I had on me at the time, for a server who ignored me and chatted on the phone for two hours,) to 100% of the bill. (And it was well earned.) I’d be mighty pissed to know that the tip didn’t go where it was supposed to go.

  87. oldcity says:

    Wow! Reading all this is bad for a new cafe. Question.. if they are renovating/outdoor eating .. do they even have a permit or need one from the city?

  88. iammoses says:

    If the employee feels this is unfair then they should contact the local office of the US Dept. of Labor and file a complaint.

  89. spinachdip says:

    If you think this cafe is sleazy for justifying keeping tips to cover business costs, you should see how tips to strippers are distributed. Before a dancer sees a single dollar bill from her garter belt, she has to tip out to pretty much every non-dancing employee in the house, from the bartender to the DJ to the makeup artist to the bouncer. Granted, they typically make enough to more than cover the mandatory tip-outs, but they can have trouble breaking even on slow nights.

    Of course, tip-outs (tips-out?) is standard practice in restaurants too, albeit to a much lesser extent, but strip joints are still taking monies intended for strippers to cover their business expenses (in this case, payroll rather than renovations) and evading payroll taxes.

  90. GenXCub says:

    I’m surprised no one has mentioned the recent Sky Cap lawsuit. Was it American Airlines (?) who instituted a $2 charge for sky cap luggage service, and this made the people who paid not tip the sky caps for their service.

  91. dragonfire81 says:

    But the fact they didn’t anyone was deliberate, because if they did, the amount of the tips would go way down.

    Business never kill their golden goose unless they have to.

    That reply from Arbol has got to be one the most BS laced PR statements I’ve ever seen.

  92. dantsea says:

    Underfunded restaurant steals servers tips to finance their expansion. Disgusting in so many ways, but at least they’ll be out of business soon.

  93. krunk4ever says:

    Our goal is to bring to the community a relaxed, casual, family atmosphere where tipping is optional for the customers and not needed by the staff.

    I have nothing but praise for what they’re trying to accomplish. Tips are not “mandatory” per se, but who the heck came up with the 15% rule? Why are restaurant owners allowed to underpay servers due to the fact that they can expect the remaining amount to come from tips?

    Tips in today’s time is not really a tip anymore, it’s basically a 10-20% tax added onto your bill. If they can’t afford to pay servers minimum wage, they should be increasing the menu’s prices.

    That way I can only tip when they deserve it.

    Said that, if there was a tip given, it should still be shared with the server.

  94. WraithSama says:

    @krunk4ever:
    Also note what is considered a “fair” tip keeps going up, too. Used to be 10% was considered an adequate tip for adequate service and 15% was a fairly generous tip. These days it seems 15% is becoming the expected minimum and 20% for good service.

    It also annoys me when places automatically add a gratuity onto your bill. A tip is supposed to be a discretionary, extra amount you can pay to acknowledge good service. If the restaurant automatically tacks on a 15% gratuity regardless, what incentive is there for your wait staff to provide good service? The point where a tip becomes mandatory is where it stops being a gratuity and becomes a hidden charge for service.

  95. Umisaurus says:

    I’m just surprised that the restaurant didn’t see the words BAD PR MOVE written all over that post in red. The whole “bad publicity is good publicity” adage only works for celebrities, not restaurants.

    I tip according to service. I will not tip for bad/no service, and when it’s somewhere that they pool it, I will write on my check “this tip is for ______.” If the restaurant in question not being fortright about who is receiving the tips, then they’re being really shady.

  96. rellog says:

    I’m sorry, but at wait point is $7/hr a decent wage??? Wait staff make much more than that at a decent resturant per hour usually.

    These guys are scum, the resturant has ZERO right to keep the tips, legal or not. It is commonly understood tips go to the waitstaff, not to the resturant. If they wish for the customers to pay for their renovations, then raise their prices…. these owners are douche bags.

  97. FrugalFreak says:

    The tip stealing is the cafe’s owner way of saying your work can be replaced and either do it or find other employment. It sickens me to see employers view employment as a benefit in itself. I bet that owner would prefer slavery if it was legal.

  98. mattbrown says:

    1) if the restaurant is paying over minimum wage, they are in the (unfortunately completely immoral) right.
    2) Can the wait staff not find another job?

  99. god_forbids says:

    Such bleeding heart crap. $7 an hour is what you get for blowing your money on drugs and rims (or crack babies, if you happen to be female) instead of educating yourself or at least getting a skill. These dregs of society deserve their minimum wage, and not a penny of my money in “tips”, to incentivize them to get REAL jobs. I am against even a minimum wage, they should get pennies per hour if that’s what they settle for. Don’t sign a contract and then bitch about the raw deal you got, its just like the “sub-prime” i.e. morons who destroyed the economy and now are crying, crying, crying.