Union Square Hospitality Group CEO Danny Meyer said in an article on LinkedIn that he will be reinstating tipping at all of his restaurants due to the COVID-19 pandemic.
Meyer is known for pioneering the elimination of tipping from all of his Union Square Hospitality Group restaurants as part of a new compensation model called “Hospitality Included.”
Hospitality Included aimed to close the wage gap between the front of house team and the back of house by factoring full, liveable wages and benefits for all employees into the restaurants’ menu prices.
“Over the course of nearly five years, Hospitality Included was able to make some strides in narrowing the wage gap, but it was never easy to make the math add up for all stakeholders, even in far more robust economic time,” said Meyer on LinkedIn.
Meyer said during the past four months of shutdowns, they’ve contemplated how their restaurants might best operate when they are able to fully reopen. “The only thing we know about the restaurant economy is that no one can possibly know what it will all look like next,” he said in the article.
As a result of these uncertain times, Meyer decided to conclude Hospitality Included and reopen with tips. “We’ve come to believe that it’s the inability to share tips that is the problem, not the tips themselves,” he said in the article. “Our ultimate goal is for your tips to be shared among our entire team, so both kitchen and dining room teams can benefit when a guest has a great experience.”
However, in New York and Washington D.C., where Union Square Hospitality Group operates restaurants, it remains illegal for tips to be shared with the kitchen team. So it will take some legislative changes to make Meyer’s vision a reality, which he says he is committed to. “We are actively doing all we can to persuade state and federal lawmakers to make that change,” he said.
In the meantime, Union Square Hospitality Group restaurants will be providing a share of revenue for everyone in the kitchen and will be increasing total compensation by an average of 25% across the full-service restaurants.
