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INDUSTRY STANDARD: Gratuitous Gratuity

by Robin Garr » Mon Dec 07, 2009 4:05 pm

INDUSTRY STANDARD: Gratuitous Gratuity
Insider Info For Those Who Dine Out
With Columnist Marsha Lynch

You're out to dinner at a favorite restaurant with five good friends when you spot a notice in tiny print at the bottom of the menu: "An automatic gratuity of 18 percent will be added to parties of six or more."

You might be tempted to take umbrage. Perhaps you pride yourself on tipping well. Maybe you regularly tip 20 percent unless service is a disaster. Why would a restaurant, by policy, require you to pay something that is, by definition, a gift to be given at your discretion?

Believe it or not, there are good reasons. It's not just that some people are cheapskates. Miserly tippers don't always hang in crowds of six or more. They sometimes dine alone or in pairs.

Think of a restaurant dining room as a little factory. The tables are its machines. These machines make two products: income for the restaurant owner and income for the servers. The restaurant owners get their income from the menu items. The servers' income comes largely from tips. While servers do earn an hourly wage ($2.13 an hour in Kentucky), by the time taxes for all their sales — cash and plastic — are taken out of their paycheck, they often receive less than $10 every payday. In other words, the tip money they take home at the end of the shift is their income.

In a typical case, a server is assigned a section of the restaurant that includes six tables seating two to four people each, depending upon configuration. During a shift with no large parties, your risk of being underpaid is spread across these six machines, so it's not the end of the world if the couple at Table 5 leaves a stingy $5 tip on a $60 check. In all likelihood, the couple at Table 3 will make up for it by leaving a $25 tip on an $85 check. Chances are good that things will even out, because the guests with moths flying out of their change purses are far outnumbered by reasonable, generous tippers.

On the other hand, if a large party gets seated in your section, you might have to combine some or all of your machines into one large table. This increases your risk of being underpaid (if there's a single host), increases your service time (splitting checks at the computer, timing the courses for several guests, refilling multiple beverages, opening wine bottles, and so on). This requires all of your attention, so you're not able to take other, easier tables. Also, when three four-sided tables are pushed together, they accommodate only six or eight guests, rather than the 12 that might be seated if the tables were separated.

Finally, some large parties suffer a cognitive disconnect: The person paying the bill sees the large amount of the check and figures, "OK, the bill is $375, and 20 percent of that is … $75!? I'll just leave $35 … that's plenty of money for two hours of work! That's almost as much as I make an hour!" That might sound reasonable, until you take into account that the server likely has to tip out the bartender, the hostess and the busser from that $35 — and they probably don't have any insurance, paid sick leave or vacation.

So don't take offense at an auto-gratuity policy stated on the menu. Besides, many good servers elect not to add it on, knowing that guests often won't add anything more if an 18 percent tip appears in the total when the bill is presented. They take their chances that good service will yield a better tip than the one required.

In this holiday season and beyond, reward good service with a decent tip, regardless of the size of your party. Those servers will never forget you, and you'll get even more personalized service the next time you dine at that restaurant.

Marsha Lynch has worked at many Louisville independent restaurants including Limestone, Jack Fry's, Jarfi's, L&N Wine Bar and Bistro and Café Lou Lou. She is currently a teaching assistant at Sullivan University, her alma mater.

Read it on LouisvilleHotBytes at http://www.louisvillehotbytes.com/gratuitous-gratuity
and on LEO at
http://leoweekly.com/dining/industry-st ... ine-out-11
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Brad Keeton » Mon Dec 07, 2009 4:23 pm

Nice article, Marsha and Robin.

I came across an interesting item over the weekend. We went to Palermo Viejo with a large group (16) on Saturday for my wife's birthday. Not only does the menu clearly state that 18% gratuity is added automatically, as was also clearly stated on the receipt, but also there was no tip-line on the credit card receipt, thus eliminating the possiblity of a diner missing the automatic gratuity and "double-tipping."

I thought this was nice, though our service was very good, and I would have liked to have added the extra 2% to make sure our server got what she deserved.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Robin Garr » Mon Dec 07, 2009 4:37 pm

Brad Keeton wrote:Nice article, Marsha and Robin.

All Marsha, for the record. I just post this stuff after we publish it in LEO, and I was slothful and procrastinatory this week. Great article, though! (And a nice statement about how effective a little thoughtfulness on the restaurant's part can be. Good job, Palermo!)
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Bill P » Mon Dec 07, 2009 5:43 pm

Brad Keeton wrote:...and I would have liked to have added the extra 2% to make sure our server got what she deserved.

Brad-
I bet she would have accepted cash. :wink:
'Winger
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Brad Keeton » Mon Dec 07, 2009 6:07 pm

Bill P wrote:
Brad Keeton wrote:...and I would have liked to have added the extra 2% to make sure our server got what she deserved.

Brad-
I bet she would have accepted cash. :wink:
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Yeah, I'm sure you're right. Unfortunately, I have cash on me. . .never. :oops:
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Jackie R. » Mon Dec 07, 2009 8:27 pm

Yeah, I never carry cash either. I think it would have been better to have optional "additional tip" line that a lot of places list.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Bill P » Mon Dec 07, 2009 8:54 pm

Really? Unless it is getting close to pay day, do you consistently leave the house without a $5 bill in your jeans?
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Jackie R. » Mon Dec 07, 2009 9:05 pm

Yes, I swear I do! It's too easy to get away without having cash and unless I'm going to the Farmer's Market or Margaret's Consignment (they give you ten percent off cash purchases), I really don't have it 95 percent of the time. Laziness, I suppose, and I felt the pinch last week when my debit card was highjacked and blocked by my bank's fraud department. NOW I have cash cause I'm awaiting a new card. I suppose I should feel bad considering the fees paid by the merchant, but the convenience is sublime. Takes less time to swipe a card through high speed processing than to dig for dollars and change.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Mark Head » Mon Dec 07, 2009 10:32 pm

I carry about 75 cents in cash. Never bank in person anymore - debit card pays for everything.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Jackie R. » Mon Dec 07, 2009 10:52 pm

Mark Head wrote:I carry about 75 cents in cash. Never bank in person anymore - debit card pays for everything.

In all fairness to the fairtrades, farmer's markets only take cash, as do some merchants, like Nancy's Bagels. Although I don't go often enough, I think it's worth it to stop by an ATM on my way Nancy's.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Roger A. Baylor » Tue Dec 08, 2009 12:04 am

Nancy's Bagels takes plastic.

I carry cash just so I can deal directly with the server when it comes time to tip, and because it's plain ridiculous to use plastic for a $2.50 espresso. Then again, I'm old.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Jackie R. » Tue Dec 08, 2009 12:53 am

Good to know Nancy now takes plastic - that definitely was not always the case, guess I've just abided till now . As far as paying for coffee on card - Highand has a quick system of turning your card into coffee bucks. That's always worked well for me and their minimum 5 buck card purchase program.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Brad Keeton » Tue Dec 08, 2009 8:55 am

Yeah, almost never cash for me. Generally, as Jackie mentioned, the only time I ever have cash is for the farmers market. And then I'll just stop at the bank next to the Bardstown Road Farmers market and get cash out on my way.

My wife is the same way. We literally never have cash, only the few dollars in change that we keep in our cars for parking, etc. I used to be in the habit of always making sure I had $10 just in case, but I would just spend it immediately.

There have been a few rare occasions where an emergency ATM trip was required for a vendor that didn't take plastic, but anymore plastic works just about everywhere.
"I don't eat vegans. They're too bony."
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Matthew D » Tue Dec 08, 2009 9:20 am

I have cash on me during some months and not during other months. And by some months I mean when there is racing at Churchill. [Although I doubt it is long before you can bet by plastic there. You can through the internet, obv.] During the months when I do, I really note how freely I spend it. So I don't have that cash on me for long. Not good. Not good at all.
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Re: INDUSTRY STANDARD: Gratuitous Gratuity

by Dan Thomas » Tue Dec 08, 2009 11:56 am

I'm relying more and more on the debit card....It's just easier to deal with. If my wife ever has more than a dollar on her person I'm amazed. It's always fun to look at the bank statement and see the ridiculously small amounts she debits, Like 79 cents for a pack of gum :roll:
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