House tipping expected to rise with minimum wage
Daniel Huber is fed up.
After years of distaste with the restaurant industry’s practice of house tipping, he’s taking a stand. The Edmonton chef has taken the fight to social media, where he’s rallied a growing number of allies – and rankled a few others.
House tipping is when a restaurant takes a portion of tips that customers pay servers and uses that cash to subsidize operations – including management and ownership. It’s often on top of a server’s tip-outs to other restaurant workers such as kitchen staff and bartenders.
With Alberta’s minimum wage now at $15 per hour, house tipping could become more common. And Huber wants it to stop.
“When servers earn that money, they deserve to keep it,” says Huber (Cook ’10).
“Things shouldn't be this way in 2018.”
The practice of tipping out never sat well with Huber, dating back to his early days cooking professionally. “It’s always been something that’s made my skin crawl. You weren’t paying us enough so the servers are?”
House tipping is completely offside, he says, and it’s becoming more common, due in part to increases to minimum wage that have strained restaurant profits. In some cases, he’s heard of house tips of up to 10%. The industry is preying upon the transitory nature of the workforce, he says, and upon young staff working entry-level jobs with no formal organization.
“There is little recourse for a lot of people working in the industry.”
Taking a stand
Huber, now a chef consultant for the soon-to-be-relaunched Two Sergeants Brewing, says he’s at the point in his career where he’s willing to take a stand. He took to Twitter this past summer to ask restaurant and bar staff to share their experiences with house tipping and other issues – and received thousands of responses. More recently, he formed the Alberta Vanguard Association, an advocacy group of servers, chefs and others.
Huber has appeared on radio and TV and even sat down with Alberta Labour Minister Christina Gray to make a case for government to take action and ban house tipping. In one instance, he also caught the attention of lawyers from one of the restaurant groups he criticized online. They issued a cease-and-desist order, taking exception to the percentage of house tipping he said was happening – while admitting it’s a practise they follow.
“They don’t understand that going after one guy … is probably not the best way to go because what it does is just shed more light on what they’re doing.”
“Any other industry would just increase the price of its product.”
Susan Lauder, a Hospitality instructor at NAIT who studied tipping practises for her master’s of tourism management, says house tipping was unheard of when she worked in restaurants 25 years ago. But with stiff competition among chain restaurants, increases to minimum wage, and the growth of point-of-sale debit and credit machines – putting control of tips in management’s hands – the industry has turned to tips to subsidize wages.
“Any other industry would just increase the price of its product. The restaurant industry is too competitive,” she says.
Focus on customer experience
Huber contends that restaurants gain a leg up by giving customers a reason to keep coming back – great food and a memorable dining experience. That means paying more for kitchen and service staff.
“If you're not doing that, yeah, you’re going to have to scrounge and you’re going to have to claw and sometimes they’re going to have to screw over your employee doing it. Things shouldn’t be this way in 2018.”
Huber says he’s “cautiously optimistic” that government will act. In the meantime, he’s happy to lend his voice to the cause because the issue isn’t going away. If anything, Huber believes it will ramp up as restaurants deal with the new minimum wage.
“They’re going to start raising the house tips again, they’re going to start cutting corners in ways they shouldn’t and my hope is that more workers see this [and say] enough is enough.”