RealReal added a small “Covid surcharge” in 2020. The surcharge line item is now gone but the shipping charge increased by the same amount. 
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I agree with just increasing the price of the food. I hate the 3%-5% surcharges they list on the menu. If you are paying your employees more then just increase the cost of the food and I will decide if the price is worth it for me.
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No surprise that merchants want to do this, while the oligopolistic financial companies’ card processing agreements prohibit this (although cash discounts are allowed). Of course, it is an example of how the finance industry gets a cut of almost everything in the economy, hence why so many students want to go into that industry.
I ate at a restaurant in San Francisco and thought the prices were a bit high. When the check came there was no line for gratuity - turns out the food prices were inclusive of paying staff a living wage. Made me pretty happy!
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This is same thing that happens when places ask if you want to “round up” your bill for some cause or say for the bins where you can throw your change (such as Ronald Mcdonald House) to donate. The business gets the tax deduction/positive publicity for the donation - made by you the customer, rather than out of their pocket. win/win for them.
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LOL - what I say to myself every time I decline to make one of these donations in a store that’s asking me. I know it’s not the cashier’s scheme so I don’t say it out loud. I don’t need the publicity for my charitable donations but I don’t like letting the corporation have it.
My son works at a fast food type place and they do the same. I didn’t realize that until he mentioned it the other day. He’s great at customer service (or faking pleasant sincerity) but some of his co-workers are not so he would probably do better if he did get his own tips. But his hourly wage is decent enough so he’s not dependent on the tips.
He also sometimes delivers catering for them and has gotten some great tips that way which he gets to keep himself. Including the father ordering food for a kid’s birthday party who gave him a nice $ tip and then told him to enjoy life now because once you have kids it all revolves around them. He always has great stories from his work and we are encouraging him to take notes and write a sitcom.
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We used to tip when we picked up our food from a local place, til we found out the kids didn’t get it, management did. That policy has changed, so we do tip on pickup now.
One of our favorite restaurants in Grand Cayman has an item on the menu - a six pack for the kitchen staff. It says if you buy that they say thanks through a round of banging the pots and pans. (Actually - I just looked it up and now that seems to be gone from their menu, but it was there for years).
It’s illegal not to share the tips with the servers. Full-service restaurants will either have a policy where the server or bartenders keep their own tips, or they will be a " pool house" where all the servers or all the bartenders divide the tips evenly. Generally, the servers and the bartenders will decide on a percentage of their tips to tip out the support staff of busers and food runners.
In the vast majority of full-service restaurants that are decently busy, the hourly wage for servers and bartenders is a small percentage of total income. On a busy night, because they get minimum wage and get tipped out, a high school kid busing will make more than a line cook who may be trying to support a family.
During Covid, certain restaurants started doing takeout and used part of the tip money to support the kitchen staff because of the drop in overall revenue. Many restaurants have kept this policy and, depending on how busy takeout is, can add a significant amount to overall income for the kitchen staff.
The restaurant industry will lobby against higher minimum wages for servers and bartenders. This is not done to pay them less because they make the majority of their money from tips. Restaurants would not be able to support as much staff if they were paying 15 bucks plus 20% for the government to servers and bartenders.
For many restaurants, the model of low hourly wages for servers and bartenders is a success for both ownership and staff. The real inequity in pay is with the kitchen staff, where the people cooking your food are making a third of the people serving your food.
This is what the fast food workers told me. I’m not saying it’s not illegal or wrong.
Or, because they don’t want to pay taxes. If the checks are made out to the person and the name of the business and the name of the person are the same, my guess would be they are not declaring it all. I recently redid my Dad’s house. Every contractor (demanded) they be paid with a check written out to them. I wrote out a few checks with separate business names. All said no and I had to rewrite the checks. I could have refused but there are few people who do the work and a wait can be costly. I wrote out the checks. But feel that the money is not going to taxed.
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Thank you for pointing that out. That’s the motivation, probably, for the 20% “back of the house” service fee mentioned upthread. A few restaurants have tried to better balance their wage distribution by raising prices and eliminating tipping but most customers don’t like that model. (ETA: I see someone upthread mentioned a SanFran restaurant doing this – that’s great! Hopefully it will become a trend, but my understanding is that historically it hasn’t been popular.)
I’m curious about sharing tips with kitchen staff. I assume that’s only legal for tips on takeout?
I think I’ve only seen a service fee for the kitchen staff once. A few times I’ve seen restaurants invite diners to “tip” the kitchen staff if they wish.
There’s also the realization that, at some point, most people will just go out less and spend zero dollars. As a business owner (not restaurants), I know it’s hard to run a business. That doesn’t mean you can pass on every cost or keep wages as high as you would like. The market also dictates what prices can be in order to make a profit and stay in business. Lots of restaurants by us are recently more empty after a post Covid boom. I think it’s high inflation.
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Yep. I might be at that point now. The last time I had a meal in a restaurant was in early spring for my birthday lunch with friends. Good local place, lunchtime, been there before. You know when you look all over the menu for the inexpensive items, but don’t find a single thing? It was like that. The affordable tuna burger was gone. All the prices were notably higher and I felt horribly guilty because they paid for my lunch and it ended up being about $40 per person, no drinks but iced tea and one dessert split between four of us.
Plus, many local restaurants around here have the option of a 30% tip, as though that’s a normal thing. I get that 15% is outdated now, and 18-20% is the new norm, but 30% is completely ridiculous.
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Fees? For what?
YIKES!!!
I’m always shocked at how robust the “eat out” culture is in my city. Even during the last economic downturn, the restaurants were always PACKED. It’s nearly impossible to go out for breakfast around here (even during the week!) unless it’s after 11am. During the shutdown, many people continued to patronize restaurants for curbside takeout and when socially distant, masked dining returned, so did the customers. The dine out crowds are back to normal numbers with the lifting of the mask-mandates, and so many new restaurants are opening all the time. I don’t think my area will ever see a slowdown in that regard.
I don’t frequent restaurants that overcharge, I used to eat out more frequently but lately I go to the ones that are reasonable. I over tipped during the pandemic like 50%, but lately I’m back to normal tipping. At our local pizza place, I ask for senior discount, I do not order from Doordash, and I go pick them up. My personal inflation rate has been reasonable.
$19 including tax for a recent fast food (not one of the fancy burger places) meal for 2. Probably will go home and make a sandwich instead going forward.
Will still go out for sit down meals, probably nicer ones less frequently and figure it is the price of entertainment, not sustenance.
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@CollegeNerd67 I live in a touristy town so it’s not surprising that the downtown restaurants are always packed, but we have a ton of restaurants even outside of the tourist district that still do a robust business. I’ve said to DH I don’t know how, with so much competition, these restaurants are making it.
At the end of last summer, a waterfront restaurant/marina closed. The new owner is reopening, or at least trying to. D17 applied for a job there in April and was hired, but he told her that the opening date (anticipated for Memorial Day weekend) was contingent on whether he had enough staff. That was a red flag to me. At some point he sent out an email to staff that training was tentatively scheduled to start 6/23 but I’ve heard rumors that he is having permitting issues with the restaurant which is causing delays. I told D17 she needed to look for a new job b/c most likely this place won’t be opening anytime soon and she’s losing money for every day she has no summer job. She emailed him on Monday and said she was making some family plans and asked if training was definitely starting next week. His response was that 6/23 was the target but “far from definite” which to me meant, he is not opening anytime soon. Meanwhile, the place S19 works is desperate for people so she went yesterday and applied. She’s feeling bad b/c she doesn’t want to leave the restaurant hanging, but when she can only work this summer, she does not have time to wait around hoping the restaurant eventually opens.
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