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Old 11-22-2014, 11:22 PM
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Default Why are restaurant/bar owners exempt from paying miniumum wage?

How and why did it come to pass that restaurant owners pay servers much less than minimum wage, expecting customers to make up the rest of servers' pay in tips?

I've been Googling, and haven't found the answers yet.

Anyone know?

Lee
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Old 11-22-2014, 11:58 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

It is the long held tradition of the business. Learned this when I worked for Ca's Unemployment Insurance.
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Old 11-23-2014, 05:02 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

$2.85 + tips.

i saw someone leave a $20 & a wad of other cash in tips on a bar, last night. he bought 1 drink, & 1 fer his pal. not the 1st time that i have seen that. attend to ppl, & they attend to u. so, a seemingly nominal-paying job may pay higher than a great career, huh~
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Old 11-23-2014, 10:21 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

actually, they are not exempt.

it works like this: there is a cash wage of $2.85/hr

if the server does not make - or more accurately does not report - enough in tips to meet minimum wage, the business has to chip in more than $2.85/hr so that the employee does earn minimum wage.
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Old 11-23-2014, 10:37 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

If you can't make minimum wage as a server, you need to polish your people skills or get the hell out of that cheap neighborhood. Our eldest daughter was a serve for a few years then moved to bar tender. Being personable and paying attention to small details, some nights she made a sinful amount of money in tips (up to $200 in tips for a 6-hour shift). Her success was treating every customer like they were the only people in the restaurant or at the bar. It worked well for her, and paid for her MBA. If you're not a people person, find another line of work.
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Old 11-23-2014, 10:46 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

Quote:
Originally Posted by Leni View Post
It is the long held tradition of the business. Learned this when I worked for Ca's Unemployment Insurance.
I am interested in knowing WHY this has been the tradition.

Why are they exempt from paying employees the same minimum wage as owners of other businesses (say, hardware stores, for example), and how did the expectation that customers would make up the shortfall in tips occur?

If anyone can point me to a source of info, I'd appreciate the help!

Thank you all for adding to this discussion, by the way!

Lee
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Old 11-23-2014, 12:45 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

I found this Lee:


What is the origin of tipping?
October 22, 1976

Dear Cecil:

Coming home from a restaurant dinner tonight, the subject of tipping came up and with it many unanswered questions. Naturally, our thoughts turned to you, Cecil. (1) What is the origin of tipping? (2) Who determined the 15 percent figure? (3) Why do cabdrivers expect a tip when their job is to provide door-to-door service? I can understand giving a tip if the cabbie has to handle luggage, but they expect one regardless.

— Karen G., Chicago

Cecil replies:

The origin of tipping is lost, like so many things, in the Mists of Antiquity. There's evidence that tipping goes back at least to the age of the Romans, but human nature being what it is, it could just as easily date from the invention of money.

Luckily for us, etymologists have managed to come up with a selection of deeply fascinating etymologies for the phrase "to tip." The dullest and most likely has it coming from the Latin stips, meaning "gift." In the days of Geoffrey Chaucer and Middle English, "to tip" meant simply "to give"--as in "tip me that cheate" ("give me that thing"), immortal words penned by one Samuel Rowlands in his 1610 Beadle of Bridewell.

The most charming explanation refers us back to the days of Dr. Johnson and his eighteenth century circle of wits. Upon entering his local coffeeshop for a session of epigram-flinging, Dr. Johnson (or rather, one presumes, his flunky, Mr. Boswell) would drop a few pence in a box labeled "To Insure Promptness" ("T.I.P."--get it?) in order to encourage a greater display of vigor on the part of the generally listless attendants.

Tipping spread from England to colonial America, but after the revolution it was frowned upon (temporarily) as a hangover from the British class system. One only tipped one's social inferiors, which, lest we forget, did not exist in the brave new world. Unfortunately, the working class eventually got around to swallowing its pride, and tipping returned with all the fervor it possesses today. Even the Communist countries have not entirely succeeded in eliminating the practice. These days, of course, taxi drivers and waitpersons depend on tips for a substantial part of their income. If you didn't tip, presumably they'd expect to be paid more, and your restaurant bills and taxi fares would consequently be higher. The fifteen percent standard is mostly a question of what the market will bear. In New York, the figure these days is twenty percent; European restaurants generally add a ten percent gratuity to the bill.

— Cecil Adams
http://www.straightdope.com/columns/...gin-of-tipping

And from this I would suspect some restaurant owner somewhere thought his waiting staff was making to much with their salary and tips so they lowered the wage. And the rest soon followed as a way to save money.
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Old 11-23-2014, 04:19 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

...I am interested in knowing WHY this has been the tradition.

uhm,,,, it's not "tradition" - it's law.
why laws-which-no-longer-make-sense-but-still-exist, that's a question for you local, state and federal politicians.

"government" never goes away or gets smaller. it's just more new rules, regulations and laws piled ontop of the old rules, regulations and laws - all requiring quadra-trillions of dollars in legal/accounting 'expertise' to keep you out of jail.

I tripped over an article some time back which postulated that regardless of how diligently one attempted to follow all local state federal regulations / laws - and all 'expert' advice / assistance procured - it's quite literally not possible to operate a business without violating some law for which one can be charged and decimated.

here's a good example:

in our little burg, which was once the capital city of the USA, a thousand years ago if you had a fire alarm system it was required, by law, to be hooked up to the city fire department.
now, technology in the 'fire sensing' department has changed, some businessi found it helpful to have alarms alerting them to breaking and entering, smoke, carbon monoxide, etc and el barfo. these types of systems are installed, maintained and monitored by private companies.
when we took a lease on a building, we could not
- discontinue the connection to the city fire alarm system
- get a business license or occupation certificate until we paid the current, and oh-by-the-way the past due amounts the previous tenant had not paid for the city fire alarm hook-up.

it's "the law"

so on advice from the lawyers who knew of buckets of preceding cases the city lost, we occupied the building for years with no occupancy certificate or city business license and never paid the city a dime.

the city never came after us because the city knew their refusal to issue x, y and z was pronounced illegal by the courts - but "the law" remained and the city lost it's revenue on our business license and our business taxes for years.

and then the local politicians raised the city income tax to cover the lack of funds. they could of course have fixed the laws - but that's would be too simple.

moral of this story? do not expect any rational behavior from government.
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Old 11-23-2014, 04:54 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

When I waited tables I was told T.I.P. stood for To Insure Promptness. Just my 2 cents.
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Old 12-28-2014, 02:07 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

It is usually customary for patrons to tip. The servers determine their own actions as to the amount of the tips they get, by the quality of the service that they give.

But first off, I access the quality of the service that I get in an establishment. I judge the amount of the tip according to how the service is.

If the service is good, I tip higher. If the service is lousy, then I tip lower, or don't leave one at all.
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Old 12-28-2014, 02:52 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

Lee, I really don't know how it started. I do know it can really benefit the person working for tips. One Secretary at a client of mine told me that she only quit bar tending because her mom asked her to. She said on a "good night" at the jersey shore, she would make $1,500.00. Another client (female attorney newly passed the bar) said she was only working to earn enough to buy a bar. She made way more as a bartender than an attorney. So far as waitstaff. As Joe pointed out, take care of your regulars and thou make pretty good money. Courteous, attentive waitstaff blows through minimum wage pretty quickly.
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Old 12-28-2014, 02:55 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

The sarcastic me says that restaurant owners got to include tips in their minimum wage calculations by well placed political contributions. Tipping probably came into being by impatient customers whispering "Bring my food fast and first and there is extra money in it for you.

Sorry for the sarcasm if it offends anyone, pm me and I'll take it down.
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Old 12-28-2014, 03:00 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

When the Fair Labor Standards Act was made law in 1938, it excluded "workers in the lodging and food service industries, many of whom regularly and customarily received tips and gratuities from customers."
I couldn't find much discussion of why, but at the time, wages were so low that tips probably afforded a pretty decent wage to those who earned them. The original minimum wage set was .25 cents an hour.
It wasn't until 1966 that the law was revised to require employers to guarantee the tipped employee receive minimum wage.
So as best I can gather, back in the day tips likely ensured the worker, on average, didn't need the protection afforded by the FLSA. Which some contend was really passed because of the Child Labor section, and to force the South to improve factory working standards.
The most recent average wage earned by wait staff I could find from the Dept. of Labor was an average of a little over $12 an hour, including tips.
http://en.wikipedia.org/wiki/User:K....the_tip_credit
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Old 12-28-2014, 05:27 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

Quote:
Originally Posted by Kimchee View Post
When the Fair Labor Standards Act was made law in 1938, it excluded "workers in the lodging and food service industries, many of whom regularly and customarily received tips and gratuities from customers."
I couldn't find much discussion of why, but at the time, wages were so low that tips probably afforded a pretty decent wage to those who earned them. The original minimum wage set was .25 cents an hour.
It wasn't until 1966 that the law was revised to require employers to guarantee the tipped employee receive minimum wage.
So as best I can gather, back in the day tips likely ensured the worker, on average, didn't need the protection afforded by the FLSA. Which some contend was really passed because of the Child Labor section, and to force the South to improve factory working standards.
The most recent average wage earned by wait staff I could find from the Dept. of Labor was an average of a little over $12 an hour, including tips.
http://en.wikipedia.org/wiki/User:K....the_tip_credit


Southern co's strongly believe in working the crap out of their employees!

I've worked for 2 that I know of, and the pay scale is very low - yet they want you to works as though you're making $25 an hour, when they are only giving you minimum wages!!! That's sad!!
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Old 05-06-2015, 02:32 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

There are several schools of thought regarding tipping, gratuities and service fees. If you look at a server as an independent contractor working in your restaurant you can understand the lower minimum wage. I'm a cook, I make food but don't have the time to leave the kitchen or the experience to balance the service to the table. I need someone to serve my food. The server needs a place to ply his trade. In America, it's customary for a guest to pay for the service rendered, and it goes directly to the server, not the restaurant. I get my money to pay my bills in the cost of the meal. The server gets his money to pay his bills from the service he provided. In America, it's customary to pay for this service via a percentage of the food bill (including drinks). You are paying for the fact that you didn't have to set your table, you don't have to pour your drinks, you don't have to go into the kitchen and explain to the chef what you want, you don't have to look for additional napkins or condiments, you don't have to ask your dining neighbor what a dish is comprised of, you don't have to go back to the kitchen to check your order, you don't have to clean your table, you don't have to know how to work the register to pay your food bill. These are all services provided to you by the server. If you enter a restaurant that utilizes the customary tipping/gratuity/service fee policy, you acknowledge that you are responsible to pay for the service you received. To refuse to pay for the service is a theft of service. If you agreed to have the lawn man plant your flowers you are obligated to pay him for his service. It's the same for tipping or paying a service fee. You may decide you were unhappy with the service, but it's your responsibility to try to correct what you don't like, giving the server the opportunity to make adjustments accordingly. It's also your responsibility to understand that person is a server, not a servant. You are not the only table or guest the server is working with. Sometimes you have to wait. Sometimes, the restaurant simply cannot accommodate your needs. None of these things is the fault of the server. Witholding a gratuity because you could not substitute the corn for the mashed potatoes is a restaurant policy and completely isolated from the service you received from the server.
A good server does not want the custom of tipping/service fees to be removed. Personally, I could never afford to pay my servers $18 - $23 an hour. But, if you want to dine in a restaurant and accept the service rendered, you have to pay it. If not, you've just stolen from your server.

Some places put an automatic grat on all bills. I do this during mardi gras and certain festivals. The servers all take on double shifts and practically work around the clock. I refuse to see them work that hard and not be compensated appropriately for their labors. Full disclosure is presented before entering, with the menu, and verbally upon greeting. Plenty of time to decide you might not want to pay for the service you are about to receive. Some people may say they worry they'll get shoddy service when the server doesn't have to work for it. Honestly, if a server doesn't give stellar service, how long do you think they'll remain employed? On the contrary, you get more balanced service because your server is no longer worrying if you are going to stiff him or not, and how he'll make his rent, or electric bill.

Didn't mean to go so long winded, especially on an old thread. Every now and then, I come out of the kitchen to help my staff with the tables. I don't know how they do it, especially during our busiest brunch shifts. It's my humble opinion that servers should get a minimum of 20% and up to 25% (especially if they work in teams). If you have a legitimate concern regarding the service you are receiving, ask to speak to someone while you are in the restaurant, not at home, on yelp, etc. The server cannot change a policy regarding the menu, payment capabilities, the temperature, the table's children next to you, etc. If you feel your water glass is not refilled quickly enough, your coffee cup is empty, you feel your steak is not cooked properly, those are issues you speak to your server about. Be proactive about getting resolution before you leave.

Hope I get to check on this before another two years goes by!
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Old 05-06-2015, 04:32 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

HI there! congrats on the brunch honors! and nice to see you back!
been busy, eh (g) - it shows, big rep in the big easy ain't easy.

I've got some (frozen from orchard fresh) peaches I've been looking to use and just pulled up the peach/pecan upside down cake - it's up next week.
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Old 05-06-2015, 09:42 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

Quote:
Originally Posted by VeraBlue View Post
In America, it's customary for a guest to pay for the service rendered ....
And this is my, as yet unanswered question ...WHY? How and why did it become customary for restaurant/bar owners to be exempt from minimum wage laws?

In other businesses where services are rendered, the owner must pay their employees minimum wage at least.

I could use the same kinds of step-by-step examples that VB listed for other service businesses, whose owners paid minimum wage at least, and employees don't work for customers' tips.

I still just don't get it.

Lee
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Old 05-06-2015, 10:50 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

be kind. we make your evening easier, by making your dinner. if we Chefs suck, cook at your place, on ur time- & i won't hafta make ur dinner-- not on my time. yinz won't make my evening via generous tips, seeing as to how waitstaff/servers get them- not us Chefs, so........, yet, i'll be a Chef that, unbeknownst to u, was your bitch. i cook that food they serve to ppl.
except, i'm an adult. adults fix a situation, then contend with real stuff that does not involve dissappreciating us.
being a Chef is a selfless career. oxymoronic me is gonna say, i luv being one & would not trade that fer luv, nor $$.
pardon me while i tend to making food, now, & taking half to a pal.
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Old 05-07-2015, 06:01 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

Interesting thread Lee. I agree, your question is as yet unanswered. Even more interesting, when one considers that in other countries tipping is not customary.

This is also the only job that I know of where management allows, even encourages their employees to solicit direct payment from their customers.

Even more interesting, pooling tips among staff, staff tipping bus boys (To get their tables cleared faster), staff tipping the chef(As an incentive to take extra care with the food) , waiting for tips that are put on Credit card and yes, even some management taking a cut, is not unheard of.

Oops!!! I just took a cab. Yes tipping is part of that. Somewhat different situation in that the cabbie is acting as management and server and must handle customer issues themselves.

As an added aside, Here is a Wikipedia article on the subject as to how the law sees it.

http://en.wikipedia.org/wiki/Tipped_..._United_States

Another piece in regard to :Tipping out"

http://en.wiktionary.org/wiki/tip_out

http://www.restaurantbusinessonline....ut-percentages

https://las-elc.org/factsheets/tips.pdf

I'll stop now. LOL

Maybe one more - Since it is rooted in law..........
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Old 05-07-2015, 07:51 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

". . . I still just don't get it."

perhaps because it is _not true_ that eateries (and other tipped industries) are not required to pay minimum wage.

the how and why are more difficult - when is easier, one can point to the date(s) of the laws. one of the 'whys' is: servers get a % of what they serve, why should the business pay yet more?

it used to be fairly consistent (the practice codified in USA Federal Law) but various states have changed.

the concept of 'tip pooling' has also changed the landscape.

example: in California tipped staff must be paid minimum state/local wage - which exceeds the Federal minimum wage - and they keep their tips.

see
http://www.dol.gov/whd/state/tipped.htm#Nevada
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Old 05-07-2015, 11:43 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

Just a thought. Tipping would be hard to kill off. Restaurateurs could easily convert to a price structure that allowed paying minimum wage (or better), unless they all did it on the same day it could take them under.
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Old 05-07-2015, 12:19 PM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

many are:
http://www.cbsnews.com/news/more-res...ipping-policy/

if you google "restaurants no tipping" you'll find buckets of results.

I don't see much difference - if the tip is included in the meal price or it's left on the table - the cost to the customer is "nominally the same"

some customers dislike the "loss of control" - a smart move would be a statement to the effect service charge included, if you are unhappy with the service please chat up the staff about the service charge."

there are servers who are quite opposed to the idea - because the make a lot more money than getting a straight hourly rate, plus - tips in cash altho less frequent today (and even less frequent in high end expensive aka where the big tips are) are difficult for the government to tax.

who was it just recently mentioned their bar tending kid who could clear $1200 a night in tips? how's $15/hour stack up against that......
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Old 05-28-2016, 10:26 AM
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Default Re: Why are restaurant/bar owners exempt from paying miniumum wage?

\quote
Apparently, the no-tipping test at Joe's Crab Shack isn't working out.

http://money.cnn.com/2016/05/12/pf/j...article_footer

edit
so I got curious about others. I don't understanding the dating on these articles

http://money.cnn.com/2015/12/23/pf/m...ex.html?iid=EL
Another big name restaurant is giving up on tipping, and will instead pay its servers $27 an hour.

Meadowsweet, a Michelin-rated restaurant in Brooklyn, will eliminate tips starting January 1 and raise menu prices 16% to 20% to make up for the change in customers' bills.

But even more noteworthy: Servers will make $27 an hour. Hourly workers in the kitchen will continue to earn around $13 an hour (plus overtime) at first and could gradually make more.


http://www.meadowsweetnyc.com/news/
Meadowsweet will be returning to the tipping system

December 19, 2015

As of January 21st, 2016 Meadowsweet will be returning to the tipping system.

Last edited by ChowderMan; 05-28-2016 at 10:33 AM.
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