Danny Meyer ending no-tipping policy at NYC restaurants
'Our ultimate goal is for your tips to be shared among our entire team'
Union Square Hospitality CEO Danny Meyer discusses the postponement of indoor dining in New York City, taking an entrepreneurial approach to reopening restaurants and feeding the hungry.
New York City restaurateur Danny Meyer, is doing away with his no-tipping policy during the COVID-19 pandemic.
Danny Meyer is reinstating tips at his Manhattan restaurant group Union Square Hospitality during the coronavirus pandemic. (Getty Images).
The Union Square Hospitality Group owner created a “hospitality included” model at restaurants in 2015 by raising menu prices and incorporating gratuity in the bill to pay restaurant workers fair wages with benefits like sick pay, by offsetting the wage gap between the front of house workers and kitchen staff. Now, with indoor dining suspended indefinitely in Manhattan and restaurants bringing in half the revenue they did prior to the pandemic, he's allowing tips.
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"It’s against that precarious and unpredictable backdrop that we are concluding the chapter on Hospitality Included, and reopening with tips, all the while advocating for policy changes that will introduce much-needed equity into the compensation system," Meyer wrote in an open letter published on LinkedIn on Monday.
“Our ultimate goal is for your tips to be shared among our entire team, so both kitchen and dining room teams can benefit when a guest has a great experience,” he continued.
Meyer will reinstate tipping beginning at his Union Square Café and continue at sister restaurants Gramercy Tavern and fast-casual café Daily Provisions, according to the New York Times, as a way to provide more money to workers, many of whom have been unemployed since March due to city-wide restaurant closings.
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Meyer also said that while tips will now go to front-of-house workers, the restaurant group will share revenue for kitchen staff as well.
“And so while at present your tip can only go to our dining room team, our restaurants will be providing a share of the revenue for everyone in the kitchen—from receiver to pot washer to lead cook— and will be increasing total compensation by an average of 25 percent across our full-service restaurants,” Meyer wrote.
Meyer was one of the first restaurateurs to pioneer the no-tipping model at restaurants in 2015 when he rolled out the policy at Manhattan restaurant The Modern, raising menu prices 20 percent to 25 percent to pay for increased wages for workers including chefs and dishwashers.
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Meyer told FOX Business earlier this month he was eager to start rehiring employees after his restaurant group had to lay off 2,000 workers, or 80 percent of its staff, during coronavirus shutdowns.
“We’ve been working really, really hard to do something to get back to hiring so many of the people, unfortunately, we’ve had to lay off," he said.