Neat Detail about Sally’s Middle Name on H Street – 18% Service Charge instead of tips

1320 H Street, NE

Very neat detail about Sally’s Middle Name from the Washington City Paper:

“At their new H Street NE restaurant, Sally’s Middle Name, owners Sam and Aphra Adkins have decided to forgo the traditional gratuity system. Instead, an 18 percent “service charge” will be automatically added to every check. That money will be split evenly between front and back of the house employees.”

107 Comment

  • Well, that ensure I won’t visit the restaurant. I normally tip 20% minimum – but a mandatory tip just ensures that me (and many others) won’t bother coming.

    • Do you just not the like the aspect where someone is telling you what to do or is there something else like you feel the service will suffer because they don’t have to work for the tip anymore?

      • Both actually.

        • Do you realize that servers make less than $3/hr without tips?

          When you have a bad day at work, does your pay get docked?

          Servers deserve reliable wages just like any other profession. Plenty of people are awful tippers (elderly people who think 10% is still a good tip, immigrants who don’t know to tip, and assholes who think the server didn’t smile enough). It’s really unacceptable to expect tips to provide a salary for someone. Really, restaurants should just pay their staff regular wages and adjust food prices accordingly. But this is a step in the right direction.

    • “Mandatory tip” is a horrible mischaracterization. It’s a fair, predictable wage for services rendered, not subject to whims and cheapskates, and works just fine almost everywhere else on earth. Admittedly bold move, though, and I hope the quality of the food and service are enough to overcome what will unfortunately keep some people away.

      • If it were fair and predictable, it would not be variable based on the restaurant’s sales. It would be an hourly wage or salary similar to what most people outside the service industry get.

    • Yeah, I’d be pretty pissed about having to pay less than I was going to. Way to stand up for yourself.

    • Will you not go because you no longer get to show the employees how generous you are? I mean, you tip 20% and you want them to know that don’t have to give them anything, but you do because you’re so generous.

  • If you’re going to put an 18% service charge on everything, why not just raise all of your prices 18% and say, no service charge, no tip.

    • Exactly. It’s like airlines and their bag fees. Just include it in the price so people don’t feel so nickel-and-dimed.

      • It’s not like airlines and their bag fees. When a restaurant only charges you for dessert if you actually *have* dessert, now *that* is like airlines and their bag fees.

    • Optics. ~20% is a very significant difference.

      • Exactly. People seem to be missing this point. If they increased their prices by 18%, then their menu items would appear unreasonably expensive to a casual observer, and it would cost them customers. I have no problem with a mandatory 18% surcharge so long as there is some assurance that it is being used to pay a fair wage to staff. Really, this should be embraced as a positive employment practice.

    • +100000000

    • HaileUnlikely

      This would work great if everybody across the board did it simultaneously, but if one establishment goes out on a limb and does it by themselves, us dumb customers will quickly write them off as overpriced because all of their stuff costs 20% more than it does everywhere else.

      • All restaurants’ actual prices are 20% more than what is listed on their menus. If you don’t pay the correct amount, you are cheating your servers. This restaurant is simply ensuring that the additional charges are paid, without breaking too far from the stupid system we have in this country. Like you said, dumb customers would freak out if a meal that “ought” to cost $20 showed up on the menu as $24. But if that same dumb customer is saved the bother of calculating a tip because it’s already on the bill, maybe everyone is happy.

        Should we get rid of tipping altogether and pay food service workers a living wage? Absolutely. But until then, I guess it’s up to restauranteurs like this one to try to find a happy medium.

    • I’m guessing the tax consequences would be much different, for one thing.

    • Its basic accounting. One line item for food sales. One line item for service charges to be split among employees.

  • From PR perspective, it may have been better if they said the tip is included and they pay employees a share of the revenue….patrons would love to hear that!!

  • I’d rather they charge a service charge and pay their employees a fixed salary.

  • I thought mandatory tips were illegal?

    • Mandatory tips are legal. Service charges are also legal, and tips must be called as such if the money is not going to the server…makes sense given the FOH & BOH are sharing them.

  • Why are so many people complaining about this? I tip 20% anyways, this will just mean that (a) I’m not subsidizing the meals of a bunch of a-holes who don’t tip, (b) I won’t have to make up for people who underpay on tips when we go out in a group. I’ll end up paying less on the margin since I usually round up from 20%. There is no downside I see.

    • Blithe

      A possible reason for the complaints/concerns is that many of us are used to deciding what the tip should be. I usually tip between 15 and 20% depending on the service. But being forced to “tip” 18% — particularly if I haven’t been to the restaurant before or don’t feel I’ve had an 18% tip experience irritates me. I agree with Nope — just raise the prices and say that there’s a no-tip policy. I realize that it’s the same amount of money, but for whatever reason, I’d respond to it much more positively. I’d also be more likely to patronize a place that makes a point of paying fair, consistent wages.

      • I agree raising prices and paying a reasonable wage is better in principle, but in practice it will never work. We are so socialized into tipping practices here that many people would still feel they had to tip and servers might still expect some tip. A few restaurants have tried the “higher prices” model and I think the result is a little awkward for everyone. In practices this works much better.
        If you have a problem with the service say something to the manager or give them a bad review on yelp. There’s no hard evidence that the tipping system results on better service.

  • Tipping is an awful practice, so I’ll be going out of my way to patronize this place.

  • Like anon @1:05, this means I just won’t go there. If you don’t want to have tips, then don’t have tips – build the cost into the price and just pay a flat wage to staff. But this isn’t “forgoing the traditional gratuity system”, this is “mandating the traditional gratuity system and showing you what we forced you to pay as a line item on your bill”.
    If I’m paying a part of the person’s salary directly proportionate to my bill, I will choose for myself how much to tip. So this place is a definite no for me.

    • Yeah, this says what I was trying (and failing) to say quite well.

    • I was able to follow your argument until the end, and I have to admit that your last comment threw me a bit. If you’re choosing how much to tip, that doesn’t make it a “salary”, nor does it make it consistent in any way.

      As far as building it into the cost, I agree with other commenters: that’s clearly the best solution, but when you’re one of the only places doing it, you just look like you’re overcharging per plate and people will avoid you. The 18% service charge, while not ideal, is a good enough middle ground for now.

      Hopefully, if and when the restaurant is able to build its reputation and customer base on the quality of its service and food, it will be able to forego this bit of financial gymnastics. I only hope there aren’t very many people like you who refuse to give it that chance based solely on a sanctimonious ideal and not the quality of the food.

  • Or they could pay their staff a living wage, make appropriate changes to their prices, and forbid any tipping.

    • This is a good idea, but unlikely to work in practice. Most people still feel like they have to tip, simply making the restaurant more expensive.

  • SusanRH

    How very European of them. I for one hate this. What if the service was awful and you don’t feel the need to tip? What if the service was amazing and you want to give more. Let me decide how much I want to tip

    • It’s not European. It’s just stupid.

    • Research has shown that there’s not a strong link between service and the tip amount. I imagine if the service is bad, you talk to management and it gets corrected that way.

    • In much of Europe and Australia, waitstaff are generally paid a decent wage by their employers and the price on the menu is the price that you pay at the end of the meal. I’m not sure why that can’t happen here. Are restaurant margins really that slim that waiters can’t be paid well?

    • If the service was awful then you speak with the manager and/or you don’t go back. Like any other business where you pay for goods or services.

    • Even if the service is awful, does the waiter not deserve to be paid? When you have a bad experience with a retail employee, do you expect them not to be paid for the day?

    • “What if the service was amazing and you want to give more?”

      Top scientists are working around the clock to figure out if that’s somehow humanly possible.

    • If you write a report at work, and your boss thinks you did a crummy job, do you get only half of your paycheck for that period?

    • Name one other job where if you, for whatever reason, think the person doing it wasn’t polite enough you can refuse to pay them. How would you feel if someone sat by your desk all day and sometimes because you were in a bad mood, or sometimes for no reason at all, said “sorry Susan, I’m not paying you today.”
      Everyone should tip 20% anyways. The idea that you should lord a servers salary over them like some sort of master is so retrograde.

    • How hypocritical. You don’t tip your air conditioner repairman or your dentist if you think they did a particularly good job do you? Conversely, do you pay them less than their billed price if they are not the picture of perfect social grace? Sounds like a good way to get taken to court.

      The simple fact is that tipping has traditionally been the purview of menial service jobs (but, even then, very inconsistently) wherein a patron of greater means could deign to toss a bit extra to someone who is clearly of lower station, if they so desired. It is as much related to the quality of service as it is to the self-indulgent satisfaction that come from (selectively) engaging in one’s noblesse oblige or sticking it to someone you thought wasn’t doing their job well enough. This effectively makes every patron a temporary supervisor to the employee, and has them directly financially beholden to the whims and vicissitudes of the moods and circumstances of hundreds of people every day. With that kind of chaotic environment, it’s no wonder there’s so much turnover in the service industry.

  • I don’t like this not because I’m one of those people who apparently can only pay 20% of my own volition and cannot be bothered to pay less than that if its forced, but instead that it’s split between front and back of house. That means that servers here will be making less than they do in a tipped system most likely– in every restaurant I’ve worked at I’ve never had to tip back of house and have usually left with, after tip-out, about 10% of my sales. What would a server leave with after 18% is split with both hostesses and cooks (paid hourly at most places)? Also why would cooks want to be paid a percentage of sales when at other restaurants they get a dependable hourly rate?

    • I’m just guessing here, but I assume that they’ll use a point system wherein the servers will take a higher percentage of the total. I also assume that “back of the house” means food runners and bar backs, not cooks.

      • Oh I’ve never heard bar backs referred to as back of house but yeah that would make sense. Food runners, that depends on the place, but I could see that too.

        • I think they do mean cooks. I read something about this last week and can’t find it, but the point was that line cooks are often overworked and underpaid (as are servers) but since this will level the playing field and take pressure off cooks (possibly also leading to longevity), the quality of food will go up and customers will be happier and return more thus servers won’t wind up with a pay cut. I’m not sure I buy it, but that’s the logic behind sharing with BOH.

          In my experience, food runners and bar backs are considered FOH. Only people doing prep, cooking or cleaning the kitchen / kitchen supplies are considered BOH.

    • Tips are usually split with back of house.

      • If BOH means cooks, then that is illegal and not often done.
        If you mean bussers and food runners, sure.

    • I’ve never had to tip BOH either. Usually bartenders tip out the bar back and host/hostess (if there is one) and servers tip out the bartenders and host/hostess (if there is one). Usually the kitchen staff are paid more than the $2.15/hour that the servers and bartenders are making.

  • Interesting strategy. Tipping exists in many service jobs for a reason—to incentivize good service. While in some sense it’s noble to split tips among employees in the front and back, quality of service might suffer, though I’m not sure if that’s accurate for this institution’s operational model. I wouldn’t pass judgment on their decision until after I went to the restaurant and determined whether I was happy with the experience and value.

    • There’s no hard evidence that the tipping system has any effect on service (economists have studied this pretty extensively). If anything it makes servers resentful. The idea that diners should be able to lord most of a servers wages over them during the meal is so retrograde.

  • I’ve read that servers who’ve worked under this system prefer it. But I supported myself for years waiting tables, and I liked the tipping system. Yes, you occasionally had a jerk undertipper, or a table who ran you ragged for exactly 15%. But more often, you could influence your own take-home with your hustle and attitude. I liked the motivation, and actually sometimes miss it in my salaried life.
    Also, tips are divided evenly? I hope the servers’ base pay is higher, because it’s a much more skilled job than busboy or dishwasher.

    • I imagine they adjust the employees’ base wages. So a server (do they have servers here?) earns the same tip as a busboy, but a higher wage. That said, it markets itself a “lifestyle retail shop,” so I don’t know whether they even have table service.

  • Amazing!! I wish more places would do this.

  • Check out the menu — trendy (gag) small plates like fried pickled chard stems ($5). That and the tipping policy assures I won’t go there.

  • Wow, I’m shocked how many people dislike this. How is this any different than going out with a large party and having a 20% gratuity being automatically added to the check?

    • For many of us, going out somewhere with a large party is probably rare – so we overlook it. But more importantly, you actually *get* something for that mandatory gratuity with a large party – a dedicated waiter or waitress who only has your table if it’s a huge group or yours and maybe one or two smaller ones. You get 20% better service. And you can still tell a manager the tip is inappropriately large and have it reduced if you have a reason to feel that way.
      But further, it’s just the optics of it – “if you liked the service, express that gratitude with a gratuity” vs “Please see the attached surcharge where I am passing off my responsibility to pay people to my customers”. It’s not a “gratuity” anymore – its a “mandatory”.

      • “where I am passing off my responsibility to pay people to my customers”
        This is silly, and anyone claiming “optics!” is basically just saying that people are too stupid to understand how the money gets from the customers to the employees. The customers pay the employees regardless of how the restaurant phrases it. Gratuity, mandatory service charge, or just higher prices with no tipping – it’s all money out of your pocket and into the employees’. Your monthly dining bill will still be the same and you’ll get good meals because you choose good restaurants, not because employees do better work in order to get better tips.

      • You’ve never worked in a restaurant; that’s obvious. Most places do gratuity btwn 6-8 ppl. I’ve routinely had tables of 10-12 with 3-4 other tables with 3-4 people not simply your little group and a 2 top. The reason the tip is added is to avoid a large group stiffing the server which would happen a lot if they were given the choice. You’re going to get the same service actually maybe a little less attentive depending on the group because big groups are very good about amusing themselves. You could try to reduce the tip, but I’ve never seen it done personally as no server is stupid enough to give truly bad service simply because the gratuity is there.

  • Hopefully calculated pre-tax.

  • Count me out. Every single place I’ve been with this setup had awful service. Why? Because they know they are getting at least 18%.

    Why doesn’t the restaurant just pay their staff a living wage and include it in the price of the food like responsible adults rather than putting the consequence of their cheapness on everyone else.

    • This is complete crap and I will not be going there. Don’t give me the excuse waiters get paid low wages and live on tips. You know what you are signing up for when you take the job. If you don’t like it then do a different line of work. I have no problem tipping 20% if I receive great service. What I have a problem with is automatically paying 18% prior to receiving the service. If I receive a horrible experience then I have should have the choice to tip less or not tip at all based on the quality of service I received. I’m not automatically giving you the waiter an automatic 18%. That’s illegal and I’ll just deduct that from my bill and tip what I feel is accurate.

      • Yes, because there are abundant numbers of high-paying jobs out there, and people who work in low-wage jobs are just lazy.

      • HaileUnlikely

        I’m thinking it’s not their loss if you don’t bring your entitled @ss in there.

      • Not illegal in the slightest esp. when it’s called a service charge. Deducting from the bill is in fact illegal, and I hope they call the cops on you when you do it.

      • “You know what you are signing up for when you take the job. If you don’t like it then do a different line of work.”

        Or you could, you know, eliminate one of the last vestiges of demeaning low-wage work that places every single patron in control of your financial well-being. You don’t tip your orthopedist less if he’s not the perfect picture of social grace, do you? No, you bitch about it or whatever and you don’t go there again (unless he or she is the best at what they do, in which case you suck it up). A waiter’s job is to convey comestibles to your table. If they are an asshole while they do it, tell the management, tell your friends, post it on your blog or yelp and then don’t come back. There’s no excuse for bad service, but the punishment therefor is not your privilege to enact, and it’s arrogant and entitled to want otherwise.

  • I’m not a “foodie” at all and never require the services of a “mixologist” or even an sommelier. That said, I eat out 3-4 time per week but it’s typically pizza, pho, thai, Diner etc.
    My average check is less than $15 (I don’t usually drink with dinner) but I generally leave a flat $10 on that, which is sometimes almost 50%. I always assumed that the tipping system was miles better for servers than a “living wage” approach. I normally sit at the bar so all the bartender/server has to do is take my plate and set it in front of me.
    I’m happy to tip generously since I tend to frequent the same places and like to support my local favorites and the staff who work there.
    But are there really that many people who stiff servers that it would work out better for them to receive a salary rather than a tip?
    I understand that in high end places there is a certain decorum, food knowledge etc. required of servers. But if I go to El Rinconcita for enchiladas I assume they would rather get a 20%+ tip from their regulars than a flat, say, $15 per hour wage.
    I’ve never worked in the industry and I’m making some assumptions here so I would appreciate any insight.

    • “But are there really that many people who stiff servers that it would work out better for them to receive a salary rather than a tip?
      I understand that in high end places there is a certain decorum, food knowledge etc. required of servers. But if I go to El Rinconcita for enchiladas I assume they would rather get a 20%+ tip from their regulars than a flat, say, $15 per hour wage.”

      I think you’re right about both of theses things. There aren’t that many people who stiff or tip really poorly (I waited tables for a long time and believe me, I’m really not that nice or friendly) and rarely got less than 20 percent. I think many servers, particularly at lower-end casual places would prefer 20 percent rather than a flat wage of $15. If that wage were $20, I think servers might then opt for the flat wage. But I think $15 an hour is kind of low for waiting tables, even at casual places. It’s not like that’s a particularly good wage.

  • The business has every right to choose this unpopular business model – but servers, bartenders, and all tipped workers front & back of house will hate the reduction in income it will yield. This will result in loss of staff and a constant stream of newbies. Plus, the IRS takes an extra chunk out of the service fee when businesses make it a mandatory charge, further reducing actual wages.

    • “Plus, the IRS takes an extra chunk out of the service fee when businesses make it a mandatory charge, further reducing actual wages.” Huh? Sure, they’ll pay more in taxes, because they won’t be able to under-report.

  • So the only reason restaurants are allowed to pay servers $2.12 an hour (or whatever the exact figure is) is because they’re tipped. Does this mean that A) base wages for servers will have to rise and B) line cooks will now be paid the $2.12 mandatory floor or closer to it?

    I’m in support of A (in MN and CA and some municipalities servers make the state’s minimum wage which leads to waiting tables actually being a decent living wage. It really isn’t in DC, in my experience.) but not in support of B and my cynical side wonders if restaurants would move towards this kind of system so that they can pay line cooks less.

    • All the servers I know in DC make very good money. My good bartender friend made 6 figures last year, for example. Maybe the crappy chain places don’t make out as well because they have so many deals, but I think overall the industry is pretty good. What sort of places have you worked?

      • Rockandroar

        I worked at Domku in Petworth and had to get a second job. The owner would randomly force us pay kitchen staff out of our tips saying they deserved it. If it wasn’t policy, and she felt they deserved it, why didn’t she pay them more herself? I’ve also never had worse tipping patrons. The food would take forever to come out of the kitchen and the customers would take it out on the servers.

        • Forcing you to pay cooks is illegal, so you really cannot base your income on such a poorly run place. Why did you stay there and get a 2nd job rather than finding a better main job?

        • Wow. Disappointing. Explains a lot though.

      • It’s been awhile since I waited tables, but I remember the pay being heavily dependent on the popularity of the restaurant and how upscale it was. Rose’s Luxury? Golden. Denny’s in Deanwood? Barely getting by. I would imagine it really varies in a place like H Street, which has a LOT of new options and gets way more foot traffic on weekends than during the week.

        • That makes sense. Crappy chain places were generally excluded in the good money category. I imagine bars do pretty well on H st, but no idea on the restaurants.

  • If you read the full article, it’s clear they are not using this as an excuse to underpay their staff – they are actually paying their staff more than most restaurants.

    “No one at Sally’s Middle Name will make less than $10 per hour plus their share of the service charge. Aphra Adkins says she expects that to add up to more than she makes as an owner. The team is still trying to figure out what to do if diners do leave tips. They’re considering picking a charity to give it to. While there is no sign that says “no tipping,” servers will explain the service charge to guests. The restaurant will also offer retirement plans and, eventually, possibly health care as well.

    Sally’s Middle Name is one of the first restaurants in D.C. to adopt this model, although it’s starting to catch on elsewhere. “Some people are doing it, and it seems to be doing really well,” Aphra Adkins says. “The employees seem a lot happier, there’s a lot less turnover in staff, and people report getting much better service.” Adkins also hopes that sharing the service charge with all employees will result in less tension between servers and kitchen staff. “This way, everyone is working toward the same goal,” she says.”

    • I love this. I might make a special trip to H St. just to support them.

    • You know what they can do with the money if people insist on giving tips? Give it to the wait staff…
      If I give a tip above and beyond what’s expected/required it’s not because I’m unaware that there are poorer, less privileged people in the world to give money to (and servers, don’t think this means I think I’m giving you “charity.”)
      It’s not like I went to dinner at Sally’s Middle Name and gave an extra tip, completely oblivious to the fact that there are homeless people, Nepali earthquake victims etc. out there. If I want to give a little bit extra to my server then let me…

    • Whaaat? Read the full article?! That’s crazy talk.
      $10/hr plus a share of tips might actually work out to a living wage. I’m with Shawess; I’ll definitely make a special effort to try this place because of the wage policy. If others have a problem supporting an owner who views paying her employees decently as *part of the cost of owning a business,* that’s just sad.

  • I’m surprised at the negative reaction. Have you guys never gone to a restaurant in Europe? I’d rather they just raise the prices of their food and pay a fixed salary to staff, but this is the next best thing. Tipping is dumb and we should just pay waiters a regular wage.

    • The crazy thing is that restaurants in Europe are typically more affordable for what you get. It’s not hard to get dinner at a nice Paris bistro for about the same price you’d pay at Le Dip.

  • Wow. After reading through all the comments here I’m pretty shocked at the number of people who think they should have the power to determine a server’s wage. Not only is the idea that this somehow results in better service in the aggregate completely wrong from an empirical standpoint, it’s retrograde and demeaning to workers.
    In a town full of mostly liberal people I’m completely shocked at the sense of entitlement and superiority evinced in these comments.

  • I’ll be the person who doesn’t notice the 18 percent surcharge and 10 percent tax — so I’ll be tipping around 46 percent. Neat trick!

  • Tips are split evenly with BOH? I really hope that means the servers are getting paid at least 12/hr. This sounds like some chef-driven bullsh*t otherwise. The most I’ve ever had to tip out to BOH is 25%.

  • Now I will never go there. First, the percentage is too low. Second, splitting the tip evenly between front and back of house is ridiculous. With this policy they are never going to be able to keep this place staffed.

  • They might have a problem finding good servers who would be willing to work under these rules. Most good bartenders and servers make around $25 per hour or more. With half of the service charge going to the BOH, making a high hourly wage will be difficult.

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