Portland diners hesitant to embrace service charges
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While some restaurant owners are embracing service charges, which they say allow them to close the wage gap between servers and kitchen staff, Portland diners may be more comfortable with the industry's current tipping structure.
Driving the news: Nearly half of readers who took last week's Axios survey said they prefer to tip when dining out — 48% of 249 respondents.
- 29% of respondents said they prefer a service charge, whereas 23% said they would like higher menu prices instead.
What you're saying: Some readers wrote that while they don't mind service charges, they question how restaurants will use the tacked-on fee.
- Greg L. said he's happy to pay a service charge as long as it goes toward health benefits for both servers and cooks. However, "some restaurant owners and the industry do not have a good track record of being consistent," he said.
- "What I want is a living wage for the employees," reader Ray C. wrote. "Why am I suddenly responsible for making sure their employees earn a decent living?"
Why it matters: The service charge is not a new concept, though it grew in popularity during the COVID-19 pandemic as a way to ensure equitable wages and insurance for servers and line cooks alike.
What they're saying: "There's not really any viable ways, at this time, to really make those two things equal in the system that everyone is used to," Brookes Decker of Submarine Hospitality, which operates Ava Gene's and Tusk, told Axios.
Context: Restaurant owners who've recently incorporated service charges, which range from 15% to 22% of the final bill, told Axios they see it as a way to replace tipping, which has roots in racial and gender discrimination.
- Service charges have also been used by restaurant operators to lure back workers after many left due to the industry's historically long hours with little pay.
How it works: In Portland, servers make at least the minimum wage of $15.45 plus tips.
Meanwhile, back-of-house employees like prep cooks and dishwashers receive hourly pay and no tips, unless their employer requires tip pooling.
Catch up quick: Businesses are not required to hand over service charges to employees, unlike tips.
The intrigue: Raising menu prices to account for the cost of labor is something restaurant owners have been mulling over, too. But it's not so simple.
- For example, a $15 burger with a 20% tip is the same thing as an $18 burger, but customers are more likely to balk at the higher price and say it's too expensive, Aaron Adams of Fermenter told Axios.
The bottom line: Whether a restaurant has service charges, higher menu prices or optional tips, don't expect a big difference in your final bill.
- "The total may end up being the exact same dollar amount," Decker said.