Not so Gratuitous Gratuities!
This afternoon my wife and I visited a local salad, sandwich, coffee and artisan bread shop 
for lunch. You know the ones that are saving the world by serving healthier food. The meals are very tasty and the portions are sized to help me contain my wanton and gluttonous tendencies to overeat! (Gratuitous Gratuities)
It was a delightful meal until we read the info-flyer leaning up against the salt & pepper shakers. We learned that apparently, the 9th U.S. Circuit Court of Appeals upheld a previous ruling disallowing restaurants the old practice of forcing their wait staff to share their tips with the rest of the employees (ostensibly to offset the low wages paid by the same employer). And for this reason, we, the customers were to be charged a 20% mandatory gratuity. The note related how the restaurant management was doing this as their social duty to ensure their kitchen staff received a living wage.
Options!
They walked us through their thought process so we didn’t conclude they were being gratuitous with our money. The three agonizing options available to them were; 1) raise the price of the meals, 2) I forget what number 2 was but in my old business we call it the ‘throw-away option’, and 3) charge a mandatory 20% gratuity! (Gratuitous Gratuities)
Thankfully the thoughtful restaurant staff is allowing us to be socially responsible by paying for mandatory gratitude. We’ve saved the day and saved their business (or have we?). Additionally, we can show extra gratitude by adding a ‘Tip’ on top of the 20% mandatory gratuity. You see, the gratuity is automatically added to the bill; the option to ‘Tip’, however, is presented when you sign your receipt on the cool new iPad register your smiling & friendly waitress hands you at your table. Before you can sign the bill the menu of options offers two buttons; one labeled ‘show your satisfaction with a tip’ or affirmatively press the cleverly worded other button stating ‘No, I do not want to leave a tip’. That’s a pretty craven business practice!
Huh?
There’s so much wrong with this that a college dissertation could be written on it. But, in its simple form, a gratuity is not a gratuity when it’s mandatory. Merrian W. says a gratuity is something given voluntarily or beyond obligation usually for some service; especially: tip. Additionally, ac
cording to the Department of Labor and the IRS, if it’s a mandatory payment for services rendered, it now becomes part of the business’s income and does not belong to the waitress.
This practice, in essence will accomplish the exact opposite of what it intended. As income, our gratuities most likely now must be reduced by mandatory Social Security payments, FICA payments, business tax, operating expenses and insurance premiums before they can be given to the employees as ‘tips’; or is that now called ‘wages’.
Redistribute Tips
Way to go small business, your passive, aggressive posture is not helping your business or your employees at all. Just raise your prices! Stop trying to make a social statement against the courts because you think it’s unfair that you can no longer redistribute your employee’s tips to compensate for the lousy wage you pay your kitchen staff. This practice will just run off your customer base that does not like to be insulted or manipulated.
Here’s the real problem. This example is merely a microcosm of the fact that we have a federal government that is into everybody’s business. In their efforts to protect everybody from everything, they’ve over-legislated so much that everybody is lost and confused in their spaghetti rolls of rules.
How can the average Mom and Pop businesses make sense enough of all the rules to make smart decisions? Instead, they are relegated to making stupid decisions over stupider ones. This can’t bode well for our future!
Gratuitous Gratuities
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