American waiters rely heavily on tips as a source of income, so it might seem cruel for a bar owner to tell his waitstaff that they can no longer accept tips. At Bar Marco, however, eliminating tipping led to a happier staff and a better business model. Owner Kevin Cox explains his reasoning in the news segment below, and he’s setting an incredible example for other restaurant owners in the process.
Located in the Strip Avenue of Central Pittsburgh, Pennsylvania, Bar Marco used to be like most other U.S. restaurants that pay their wait staff well below federal minimum wage due to the American tipping structure. Restaurants are legally allowed to pay wait staff as little as $2.13/hour as long as the tips acquired by the server end up rounding out the server’s hourly pay to meet federal minimum wage. If the server’s minimum wage plus tips does not equate to federal minimum wage, the restaurant’s owner is responsible for making up the difference. This isn’t always what ends up happening, especially when servers don’t know their legal rights, however, so Bar Marco and other restaurants like it have adopted a no-tipping structure in order to protect their servers.
Co-owner of Bar Marco, Robert Fry, elaborated on the exact distribution of salary and benefits for his wait staff in an interview with Eater, revealing that each full-time employee with be given a base salary of $35,000 along with healthcare and 500 shares in the company. While $35,000 is by no means a staggering salary in the U.S., it is certainly livable and therefore provides a much-needed level of security and comfort for waitstaff. As anyone who has worked as a server can and will tell you, relying on a tipping structure to make ends meet can be absolutely terrifying. You may be quick to think that if a server doesn’t receive a proper tip, it’s because that server was lacking in quality of service, but often times this isn’t the case. Servers lose tips for any number of reasons ranging from a patron disliking like the dish they ordered (the fault of the chef) to a patron simply taking the anger and frustration of a bad day out on the first easy target they can find (just because you had a bad day at work doesn’t mean you can snap at your waitress every time she speaks). While many people understand how difficult it can be to work in food service, many do not, and putting employees on a salary system effectively removes the stress of having to deal with patrons who feel they are above tipping.
While many restaurants that make the switch to salary structures raise prices to compensate for the difference, Bar Marco has a different strategy to keep patrons on their side. The co-owners have decided to keep profits up by hosting more events, expanding their menu, and increasing the number of covers they do in their wine room, according to Fry. He goes on to say that all of Bar Marco’s employees are fully on-board and signed contracts that hold them accountable for a higher set of responsibilities; after all, getting a deal like this in the restaurant industry means there are plenty of people who would bend over backwards to have the same opportunity. Employees will be responsible for showing up to bi-monthly finance meetings so that there will be complete transparency within the staff. To be able to successfully keep prices low while treating the waitstaff well, Bar Marco’s co-owners will need a dedicated team that can put in the work to really pull this off.
All in all, what you have at Bar Marco is a waitstaff that now must be highly qualified to hold their positions, but who are, in turn, respected and taken care of by their employers. This yields happier and more secure staff and servers who are highly incentivized to keep their jobs, and you have to imagine that this leads to all-around great service. You have a team that completely supports the business they work for, because that business supports them back. It’s a pretty simple, yet effective strategy when you consider it in these basic terms. This is the change that waiters and waitresses have been waiting for in the food industry since tipping structures began, and I have a feeling that this trend is going to start catching on like wildfire.
What do you think of Bar Marco’s no-tipping structure? Have you heard of other restaurants doing this? Let us know your thoughts in the comments below!