Japanese Restaurant Eliminates Tipping And Just Pays A Higher Wage

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Riki Restaurant, a Japanese restaurant in New York, recently decided to eliminate tipping and instead raised its menu prices to pay staff higher wages.

Notices at the restaurant have now been posted saying, “Riki Restaurant is now a non-tipping establishment. Tipping is not required nor expected.”

Riki Hashizume, the owner, told the New York Observer that the no-tip policy is in accordance with Japanese custom. “I came from Japan, and I have some ideas and I have some points of view,” he told the paper. “Usually we don’t take tips in Japan.” He said he raised menu prices by about 15 percent. When asked by ThinkProgress for more of his thinking in instituting the policy, he noted that it had just been instituted and to check back in in three months.

In the United States, tipping is standard in restaurants, so much so that people who work for tips can be paid a lower minimum wage of just $2.13. Their tips are supposed to make up the difference, and if they don’t employers are required to pay them extra, although that rarely happens. But there is a growing trend of dining establishments doing away with the custom in favor of just paying a higher wage. In New York, Sushi Yasuda had already done away with tips last year. Other high-end restaurants have done the same, including Linkery on the West Coast, whose owner says getting rid of tipping improved both service and revenue. But some places that serve the masses have also joined in, including a bar in Washington, DC that pays workers $15 an hour in lieu of tipping.

The idea behind tips is that they allow customers to dictate and reward better service. But that’s not how they play out in practice. Customers’ perception of service accounts for just about a percentage point change in what tips they leave. And while 20 percent is considered the standard tip, three-quarters of restaurant goers cop to leaving less than that and 11 percent leave nothing at all. Meanwhile, tipping perpetuates racism and sexism, as more attractive and white servers get higher amounts than others.

Another way to erode the power of tipping is to simply include tipped workers like waiters, hairdressers, and taxi drivers in the regular minimum wage. After Hawaii passed a recent hike in its minimum wage that includes tipped workers, a total of eight states require these workers to be paid the same rate as everyone else.