Restaurant calls itself a 'no-tip establishment.' But it's charging a 17.5% service fee to pay workers

Stone's Throw J.J. Gouin/ShutterStock Snoo_94642/Reddit

‘So a mandatory tip’: Restaurant calls itself a ‘no-tip establishment.’ But it’s charging a 17.5% service fee to pay workers

'Raise your prices and stop tipping.'

 

Jack Alban

Trending

Posted on Feb 5, 2024   Updated on Feb 14, 2024, 12:51 pm CST

On the internet, it seems that a day doesn’t go by where there isn’t someone arguing that servers aren’t earning enough in gratuities. Alternatively, other folks insist that tipping is ultimately not necessary, and if waiters and waitresses don’t like it, then they can go and find another job.

This same debate over gratuities erupted in the comments section of a viral Reddit post uploaded by user @Snoo_94642 who snapped a photo of a placard at a Stone’s Throw Pizza restaurant. The sign highlighted a recent policy implemented by the establishment that adds a 17.5% service charge to every single order in place of tipping. Stone’s Throw says that it has done away with tipping in general, but it seems that several Reddit users believe that the service charge is just gratuity by another name.

There do seem to be benefits to employees who work at the restaurant because due to legalities in the area where Stone’s Throw operates, state law indicates the service charge amount is tax-exempt.

The menu in the Reddit post’s photo reads: “We’re now a no-tip-necessary establishment. We will not apply a 17.5% service fee to your bill, which goes to support fair wages and benefits for our entire team. This change promotes prosperity, forges equity, and aligns with our ethics.”

Towards the bottom of the menu, there’s an image of a QR code and a message that reads: “Learn more about our thought process here.”

In a caption for the Reddit post, OP linked to the pizzeria’s web page, which provides details about its “tip-free policy” in greater detail. The restaurant went on to explain why it decided to implement the tipping fee while preempting questions some have about the practice. Stone’s Throw explained why it chose 17.5% as the standard “service fee” percentage. “The Vermont Department of Revenue does not require us to tax service fees less than 20% when added to food and beverage bills,” the FAQ reads.

The pizzeria also delineated its reasoning for getting rid of an option to tip on receipts altogether. “Adding a tip line sends mixed messages to our team and guests and its presence signals that tipping is still an expectation,” the restaurant’s site reads. “By eliminating it, we’re seeking to resolve the conflict that surfaces when there is pressure to give or receive a tip.”

For those who may want to give their servers more money than they’re already paying for their food on top of the service charge, the restaurant still offers the option to leave an extra gratuity: “Tipping at our restaurant isn’t necessary. We recognize that some guests may still want to do so because it feels like an important part of their dining experience; if you wish to tip, please write it in on your credit card slip or leave cash on the table.”

According to the restaurant’s web page, this policy has been implemented at all of its locations (4 as of this writing, with a fifth on the way) and the entirety of the service fee goes to restaurant staff. “One hundred percent of the service fee goes to pay our team, which covers less than half of our labor expenses. The service fee is not broken up and redistributed to other business initiatives or investments,” the site states.

As for the restaurant’s decision to ultimately switch to the service fee model, Stone’s Throw management wrote that it was a question of ethics. “We recognize the problematic roots of tipping and how it contributes to present-day issues in the hospitality industry,” the site says, while stating the fee provides for a more equitable compensation experience for its workers. “They deserve a non-disparaging fee for said service and all the hard work that’s behind what you see in front of you.”

@Snoo_9462 didn’t seem too impressed with the service fee option, as they wrote in their post that customers don’t place their orders with a server, but at the counter themselves. They did concede, however, that the restaurant does bring diners’ food to their tables. “You need to go to the counter and order what you want. (Although they do bring it to your table),” the Redditor wrote.

Users who saw the post didn’t seem to be all too impressed with Stone’s Throw mandatory service charge policy. One commenter wrote, “17.5% is no chump change,” while another gave a reductionist explanation of the new initiative: “So a mandatory tip.”

No-tip but service fee included.
byu/Snoo_94642 inEndTipping

Others were more critical, like this one Redditor who seemed to think that the service charge and the subsequent menu prices of its food misrepresented what customers are paying for their meals. “Benefit is that you can bring in customers showing them the low price, and then once they are in, push a % on them by the time it’s too late. Most customers aren’t gonna leave once they’ve stepped in,” they said.

“I would get the f*ck up and leave while letting them know why I got up and left (in a polite way). This is bullsh*t to the highest degree,” another user wrote.

Someone else wondered why Stone’s Throw wouldn’t just collapse the service charge into the individual prices of its menu items: “Raise your prices and stop tipping, that is the honest way to manage your business and pay your employees.”

However, another user on the application argued that this business model isn’t common in food service: “And a universal way to manage business and pay employees anywhere and everywhere in the world except in the restaurant industry in the US.”

It would appear that they’re right that this method isn’t too successful for businesses. Eater reported several restaurants that adopted a non-tipping model ultimately abandoned this practice, stating that the model all but failed.

The Daily Dot has reached out to Stone’s Throw Pizza via email and @Snoo_94642 via Reddit direct message for further information.

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*First Published: Feb 5, 2024, 8:00 pm CST