Where your tips go

If the Ivy restau­rant is any­thing to go by, tip­ping your waiter is a com­plex busi­ness.

The Irish Times - Weekend Review - - FRONT PAGE - Deirdre Falvey

You’re sit­ting in a nice restau­rant, happy after a good meal, with de­cent ser­vice – and the bill comes. You may tip in cash or add a gra­tu­ity to your card. Or there may be a ser­vice charge – a non-dis­cre­tionary tip – added to the bill. What hap­pens to that money? Con­tro­versy about how tips are han­dled at the Ivy restau­rant on Daw­son Street, Dublin, has blown up this past month after a pub­lic air­ing of staff dis­gruntle­ment at the restau­rant. The high- pro­file restau­rant opened in July. It is part of the Ivy Col­lec­tion in the UK, a busy, hard-work­ing restau­rant, with 243 seats and all-day ser­vice.

Three Ivy wait­ers (one of whom has just left) spoke to The Ir­ish Times at length about tip­ping at the restau­rant. To il­lus­trate what they see as un­fair prac­tice, they shared their staff man­ual, job con­tracts, payslips and What­sApp group chats with man­agers.

They paint a pic­ture of a lack of trust, un­happy work­ers and an ab­sence of clar­ity about how card tips – which are the ma­jor­ity – are han­dled. The fig­ures, these staff say, don’t add up. They be­lieved they would make good money for hard work at the Ivy, but they say this didn’t hap­pen.

The Ivy’s lack of trans­parency in how tips and ser­vice charges are han­dled seems un­fair, a sea­soned Ir­ish restau­ra­teur says. Staff find it hard to un­der­stand, and they are not alone: more than a week’s re­search with ques­tions to staff and the restau­rant has failed to fully clar­ify the quag­mire of some­times con­tra­dic­tory in­for­ma­tion.

Pity the poor cus­tomer who is try­ing to de­cide if – and how – to give their waiter a tip.

What the staff ex­pected

Wait­ers were re­cruited this sum­mer for the new restau­rant at a con­tracted hourly pay rate: most around ¤10-¤11 an hour.

Two wait­ers say they were told they could keep 80 per cent of any cash tips, and were ex­pected to “tip out” 20 per cent of their tips to bar­tenders and run­ners (wait­ers I spoke to have no is­sue with this com­mon prac­tice).

Sev­eral say they were told ver­bally that 40 per cent of card tips would be pooled, and di­vided be­tween all wait­ing staff; an­other was told they would get 40 per cent of the tips they gen­er­ated. The other 60 per cent would go “to the restau­rant”.

When pressed on what ex­actly this meant, the wait­ers said it was never clear to them, and noth­ing was writ­ten down. Tips are not men­tioned in the staff man­ual. Some of this 60 per cent may go to other staff.

“Lor­raine” says she was in­ter­viewed for her job as a waiter hur­riedly, in an in­for­mal set­ting: “It was vague but it sounded lu­cra­tive, [like the work] was def­i­nitely of value to a waiter. I was sur­prised it was so gen­er­ous – [I was told I would get more than] ¤11 an hour and 40 per cent of card tips.”

What hap­pened

Wait­ers’ payslips – a num­ber of which I have seen – have four cat­e­gories of pay­ment.

Ba­sic: The hours worked at the statu­tory min­i­mum wage of ¤9.55.

Sun­day premium hours ( at a higher rate).

“Tronc” pay­ment: Tronc is an es­tab­lished method in the trade of dis­tribut­ing tips. In the Ivy, it tops up the statu­tory min­i­mum wage to the con­tracted hourly rate. The Ivy Tronc com­prises the 12.5 per cent ser­vice charge levied on ta­bles of five or more, pooled and used to part-pay wages.

Bonus: A sin­gle fig­ure, with­out ex­pla­na­tion. It is a dis­tri­bu­tion of tips from card pay­ments, but there is no in­di­ca­tion of how it is worked out.

In their first payslip, and for at least two weeks in early No­vem­ber, there was no “bonus” dis­tri­bu­tion of card tips. Many wait­ing staff were dis­ap­pointed no card tips were in­cluded at all, and their up­set is vis­i­ble in man­age­ment-staff What­sApp com­mu­ni­ca­tions.

Staff mes­sages in­cluded: “It’s fine to say calm down, but at the end of the day we are miss­ing hours and tips”; “It’s ex­tremely frus­trat­ing and shock­ing”; “24 hours since out pay­check... still no of­fi­cial word of what hap­pened to our tips”.

When credit card tips were in­cluded in later payslips, they were well be­low what wait­ers reck­oned they were due at 40 per cent of the pooled credit card tips. (When they re­ceived their payslips yes­ter­day, Ivy wait­ers I spoke to had again re­ceived no pay­ment for card tips.)

Lor­raine shows me her payslips and presents her own cal­cu­la­tions. Two weeks in No­vem­ber have no bonus/card tip at all, she points out; in Oc­to­ber she worked 65-hour weeks, and the card tip dis­tri­bu­tion she re­ceived that month was ¤420. “I worked out it was ¤ 1.52 ex­tra each hour I worked. That’s not 40 per cent of the card tips I gen­er­ated.”

“Cristal” says in her early weeks: “I might av­er­age ¤200 on card tips in a night. With 10 wait­ers, that’s ¤2,000 card tips.” But “Alan” and Cristal say their share of card tips worked out less than ¤ 100 a week, while they each pro­cessed more than ¤1,000 a week.

Howit blew up

In late Septem­ber, says Lor­raine, a waiter was “sacked” for sug­gest­ing pa­trons leave a tip in cash. She is hor­ri­fied a waiter would do this, and says she would never ask for cash; if cus­tomers ask about tips, she an­swers diplo­mat­i­cally that “I get a per­cent­age”.

A man­age­ment no­tice pinned up in the restau­rant in No­vem­ber went pub­lic, ac­cus­ing wait­ing staff of “de­plorable greed” in ask­ing cus­tomers to leave tips in cash rather than on a card. It said due to the “con­tin­ued in­abil­ity of those tak­ing card pay­ments to fol­low pro­ce­dures and con­sider the whole team here”, there was “no bonus pay­ments for front- of- house mem­bers to share”.

It states in bold type that “from Mon­day NO WAIT­ERS will ever be al­lowed to take any pay­ments from guests, there will be a pass­word on the credit card ma­chine and the man­agers will take all pay­ments, with­out ex­cep­tion.”

Later it re­it­er­ates: “No team mem­ber is to ever han­dle cash or card from a guest.”

The writer of the state­ment was dis­ap­pointed that “all the run­ners, bar backs, bar­tenders, cock­tail wait­resses who make wait­ers’ jobs pos­si­ble have re­ceived noth­ing”.

What the Ivy says

The Ivy did not of­fer a man­ager to dis­cuss the is­sue for this ar­ti­cle, but is­sued a state­ment through a strate­gic com­mu­ni­ca­tions com­pany.

Credit-card tips, it says, go “to­wards a shared gra­tu­ity per hour that all restau­rant staff re­ceive. This is shared across all c 150 staff in the restau­rant (ex­clud­ing man­age­ment). This is paid in ad­di­tion to their hourly wage and is guar­an­teed by the com­pany in that the com­pany will make up any short­fall and is, there­fore, re­gard­less of whether any tips are paid by pa­trons.”

It refers to a waiter re­quest­ing a cash tip, which was in­ap­pro­pri­ate as the com­pany be­lieves “all gra­tu­ities should be for the ben­e­fit of the en­tire team”. When pressed they out­line three pay el­e­ments (as well as Sun­day pay):

“A ba­sic hourly rate (which meets min­i­mum wage re­quire­ments)”

“A guar­an­teed ad­di­tional hourly rate (Tronc) is paid to each em­ployee – the rate de­pends on the job they hold in the restau­rant – this is funded by the 12.5 per cent ser­vice charge ap­plied to bills of five peo­ple or more – and the com­pany cov­ers any short­fall as this hourly rate is guar­an­teed to the in­di­vid­ual.”

The bonus – “the split of all credit card tips re­ceived in the prior month – 100 per cent of which is dis­trib­uted to all staff in­clud­ing front of house, wait­ing staff, run­ners, kitchen staff”, ex­clud­ing man­age­ment and vary­ing each month.

From this we un­der­stand that work­ers’ con­tracted hourly pay com­prises min­i­mum statu­tory pay, topped up by money from Tronc – the 12.5 per cent ser­vice charge.

Ba­sic agreed rates in the Ivy are par­tially paid from ser­vice charges, which are es­sen­tially an oblig­a­tory tip. This is a prac­tice in some Lon­don restau­rants, but is not gen­er­ally em­ployed in Ire­land.

Dis­crep­an­cies

The Ivy says 100 per cent of card tips are shared be­tween all staff, while wait­ers say they were ver­bally told they would get 40 per cent of card tips.

On Septem­ber 12th a head waiter’s mes­sage to the group What­sApp out­lined a change in ap­proach to card tips: wait­ers were to keep note of card tips (ex­clud­ing ser­vice charges) from their ta­bles, and at week’s end the gen­eral man­ager would con­firm them.

“This will mean that what­ever card tips you make, you get. (Within rea­son. The % still ap­plies, but it will now be at LEAST 40 per cent from here on in, to­wards your pay­check).” Wait­ers say this didn’t hap­pen.

In two re­cent payslips there were no bonus/card tip pay­ments at all, and the “de­plorable greed” no­tice went up.

Cristal is dis­traught at the small amounts dis­trib­uted to staff, while the restau­rant “does ¤40 grand a day”. The waiter says she has seen daily till reads show­ing ¤36,000 busi­ness; some days they serve 800 peo­ple. “Very few peo­ple leave no tip; even ¤2 tips add up.”

Alan de­scribes a great team in the Ivy – “fun, a great mix of race, sex­ual pref­er­ence, na­tion­al­i­ties”. But “there is no staff mo­rale” and “huge” staff turnover.

Other restau­rants

“Put your­self in the shoes of an Amer­i­can tourist,” says Robert Doggett, co-owner of Dublin’s long-es­tab­lished Tro­cadero restau­rant. “They of­ten ask how we do it here. The an­swer is, ev­ery­where is dif­fer­ent. There are no set rules.”

John Healy, gen­eral man­ager of Sue­sey Street bar and restau­rant, and a vet­eran of the busi­ness and RTÉ’s The Restau­rant, says in his ex­pe­ri­ence good wait­ers are paid a bit more than min­i­mum hourly wage, while kitchen staff, not in a “tip­ping zone”, are on higher rates, salary rather than hourly wages. He thinks most restau­rants pool all tips among wait­ers.

In Sue­sey Street card tips go through pay­roll and are dis­trib­uted through a Tronc points sys­tem (based on hours worked and ex­pe­ri­ence or se­nior­ity), or­ches­trated trans­par­ently by a man­ager or se­nior waiter. A spread­sheet shows the team the tips re­ceived and how they are di­vided. “It is as com­pli­cated as tax eva­sion it­self!” he says. Ex­pe­ri­enced wait­ing staff get about ¤11 an hour ba­sic, with tips on top.

“It’s their money. I don’t own that. Tips be­long to the peo­ple who do the job.” He says to get ex­pe­ri­enced staff, they need to be able to make money: it’s a mat­ter of fair­ness. “We’re all in it to­gether, pad­dling the same way. We need to al­low our staff to make money as well.”

Cash tips are few and are pooled at the end of the night be­tween floor staff. Wait­ers share 75 per cent, and 25 per cent goes to other front-of-house.

The sys­tem at the Ivy, he reck­ons, “sounds slightly un­fair”, and he thinks man­age­ment needs to be trans­par­ent and clear about what’s hap­pen­ing with tips.

“In city cen­tre restau­rants the work is hard – you are at the coal­face. It is full-on, high-oc­tane. You can make money be­cause of tips, but it is stress­ful and emo­tion­ally drain­ing and you earn ev­ery penny of your tip.”

The Ivy is a new restau­rant set­ting up, and hitches are to be ex­pected. The Ivy Col­lec­tion’s es­tab­lished UK sys­tem may be work­ing against it in Ire­land, as the prac­tice of us­ing ser­vice charges to par­tially pay con­tracted hourly wages seems not to be com­mon here, quite apart from the staff anger about lack of trans­parency on tips.

Doggett says: “In fair­ness, it must be dif­fi­cult to open some­where new, serv­ing break­fast, lunch and din­ner over seven days, with a new crew. I would hate to be in their shoes.” A lot of money floats around in their restau­rant busi­ness.

Lor­raine says wait­ing staff are “treated like the golden goose be­cause of our tip gen­er­a­tion”.

What do Ivy staff want? Alan: “To shine some light on what they’re do­ing.”

In the pre-Christ­mas sea­son, the pub­lic spat has cer­tainly opened up the of­ten opaque busi­ness of tip­ping and ser­vice charges – and its grow­ing com­pli­ca­tion in a world of ever-re­duc­ing cash.

The Ivy says 100% of card tips are shared be­tween all staff. Wait­ers say they were told they would get 40% of card tips

PHO­TO­GRAPH: GETTY IM­AGES

Some staff at the Ivy are un­happy about an ab­sence of clar­ity about how card tips – the ma­jor­ity – are han­dled.

The Ivy in Dublin: In two No­vem­ber payslips there were no bonus/card tip pay­ments, and the “de­plorable greed” no­tice went up. PHO­TO­GRAPH: DARA MAC DONAILL

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