T.J. Callahan says he was “trying to do the right thing” when he opened the Thomas & Dutch restaurant earlier this year, and switched from the traditional tip model to a required 20% service charge added to the bill.
Not only would it mean more money for the servers, but, Callahan said, the flat service fee would also help eliminate historically negative perceptions of tipping as having sexist and/or racist origins.
But the service charge lasted only five months, before Callahan went back to the old format.
“The hostility we got” from customers to the fee, Callhan told Evanston Now, included being accused of running a “socialist, woke restaurant.”
Last week, Evanston Now reported that another eatery, Soul & Smoke, has instituted a mandatory charge in place of gratuities, but Thomas and Dutch had reinstated tipping.
Callahan was not available for an interview at that time (another employee confirmed the end of the service charge), but was able to talk with Evanston Now today.
Callahan said that quite frankly, “some people were not coming because the service charge was in place.”
“It dramatically increased my costs,” he said, “but for the most part people seemed to hate it.”
The mandatory fee had become a “third rail.”
Even the servers, whom Callahan said received the equivalent of a 66% hourly pay raise from the charge, had to take grief from customers.
The required fee, Callahan said, “left a bad taste in the mouths of guests.”
Thomas & Dutch is an upscale downtown restaurant, a rebranding of Callahan’s more casual Farmhouse at the same location.
He had thought that progressive, affluent, educated Evanston would accept the service charge, particularly with the past negative connotations of tipping.
Didn’t happen. Despite putting service fee information on the restaurant’s website, and on a table card for diners to read, Callahan said customer reaction was often “what the hell is this?”
There is still a 4% surcharge to help cover employee fringe benefits such as health care. Customers are made aware of that.
But as for dropping the mandatory 20%, Callahan said, “I had to go back to the traditional model.”
“I need to stay in business.”
Considering the less-than-positive customer reaction he found for service charges, Callahan is worried that Evanston City Council might end the sub-minimum wage (which servers are now paid, with the understanding that tips will increase their take-home pay), in favor of a higher minimum rate.
Callahan said that might lead diners to Skokie or Wilmette, which are not considering such changes (Chicago is).
Ironically, Callahan noted that in his restaurant industry experience, the typical voluntarily paid tip is 20% … the exact same amount he had added as a mandatory service charge.
Good for him for trying. People are idiots sometimes. The 20% surcharge minus tip = the same exact amount most people pay, and it gives servers who busy their butts every day a little more financial security. And I know Mr. White agrees with me!
I am glad that he tried as well. When I travel to place that does not have tipping, I like it. In my experience the service is fine, and I don’t have to think about the gratuity.
I guess change is often unsettling. The “socialist, woke” criticism does not make any sense. No one tips cashiers and baggers at grocery stores even though it helps us when they keep the line moving as quickly as they can. No one is calling Jewel “socialist” as a result.
If the City eliminates sub-minimum wage for tipped workers there will not be a service charge item on the bill to get upset about. The prices will just be higher and we may all be confused about whether or not the social norms for tipping are adjusted to offset the increased wages our servers will be getting.
And Evanston prices will be higher, creating yet another competitive disadvantage for Evanston businesses. And who does that help?
To be clear, I am not advocating to eliminating the sub-minimum wage. I don’t know what is best. I do like having service cost included, but making that work requires social norms where that is expected. If only a few isolated cities eliminate sub-minimum wages, then there could be confusion about the appropriate tip. That could lead to even more restaurants going out of business. But maybe not. It will be hard to tell since so many restaurants go out of business anyway.
I appreciate what the owner of the restaurant was trying to do but we’re all struggling, we’re all working, we all have mouths to feed, we all have bills to pay, we’re all grinding. So when I see “progressive, affluent, educated Evanston would accept the service charge” – my immediate reaction is “GFY”. It’s your business, you handle your employees. You take a pay cut, you cover the 15% tip they get to make it 20%.
Stop pushing this narrative that we have to pay for peoples salaries to make their live easier. Life isn’t easy, life is hard and it’s always going to be that way. Adapt and overcome.
I think as a society we are pushing back on all of the “fees” being added to the consumers bill. Not just from restaurants but from our gas bill, cable bill, sporting events, etc.
I know I’ve had it and do what I can to avoid paying the added fees. Example: most restaurants charge the credit card processing fee now. I pay cash to avoid that fee. I think restaurants should accept other forms of payment like Venmo so the consumer can avoid paying that fee if they don’t have cash. On a $200 bill they’re paying an extra $9.
We are being ‘Fee’d’ to death in America. Money is tight for everyone and everyone needs a break. We’re not going to get a break so people are going to voice their opinion when they see a mandatory 20% tip included in their bill + 4% credit card processing fee + 10.25% sales tax + 4% insurance fee for the workers.
That all adds up and the consumer has had about enough.
We can’t keep this up, this system doesn’t work. I’m sorry but it doesn’t.
I fully support FTC chair Lina Khan going after junk fees. These fees are attractive to business because they can pull in more customers by advertising a lower cost than the actual cost of the goods or services. The restaurant industry is a little bit different than other industries, as customers have been long expected to directly pay the wait staff. Ideally the cost on the menu would cover the cost of paying employees a fair wage and processing payment. But since this isn’t the norm in the industry, I can understand why they decided to try a mandatory service charge.
I would prefer to move away from the tipping culture. My experience in other countries where tipping is not expected, and workers earn a living wage has been wonderful. However, there is more to it than adding a service charge – the whole restaurant culture needs to change. The typical US dining concept that you have a designated server doesn’t work with the service charge mentality. When dining in Europe I find that someone might take your order but everyone on the floor is able and willing to check in and take care of any customer. There is no trying to flag your wait person over if there’s a problem – anyone will jump in. I’ve had experiences in the US where after our order is taken and a large party gets seated and our server is occupied for extended periods and we might never see them again until it’s time for the check. As someone that worked in the business for almost 10 years there can be days where work is very uneven depending on how tables are assigned. There is competition to get the best shifts and sections creating animosity among co-workers. These issues don’t happen if tipping isn’t involved. There are other ways to cover the additional costs that don’t leave you feeling nickled and dimed.
I am turned off by all of the fees. It ruins the experience. I’m now expected to scrutinize the menu for a tiny asterisk that explains multiple fees. Even if it is optional, I don’t want to have that awkward conversation with my server. Again, it ruins the experience. So, yes, I have purposefully avoided restaurants that have additional fees.
A restaurant can succeed by listing one, all-inclusive price (including gratuity). I believe that Twisted Hippo in Chicago operated this way. It made the experience so much easier.
These “fees” being passed down to customers will reach it’s breaking point, if not already. A perspective that seems missing in these comments is the question of whether a server doing a bad job should be tipped the same as a server doing a great job. This mechanism that exists in the framework of tipping is truly what weeds out bad employees in the food service industry. Is it a gentle mechanism? No, but is life supposed to be somehow engineered to be gentle?
I also noticed comments that compare this country to other countries that don’t have a tipping culture. The dark reality is that often in those societies, a server doing a bad job is simply replaced the same day without any appeal process, just because a customer complained. Those societies have surplus job seekers that will happily fill those positions and work with diligence. Sure, some post-industrial societies practice the no tip culture. If it is historical, then perhaps that works for them. But the ones that just recently adopted it under a banner of social justice are experiencing the same pushback whether they admit it or not.
The loss of the ability to be judged for your individual accomplishments and substituted with this mass group identity judging is exactly why we will continue to wonder why our country keeps throwing money at problems but never seeing any real improvements.
I worked as a server in high school, all four years of college, and for a few years before and during law school. I was fine with tipping. For the most part, customers tipped well for good service. There now seems to be an expectation that all services need to be tipped and at a rate that does not correlate to the quality of the service.
Evanston is more and more treating it’s residents like children who are incapable of making their own decisions. Whether it’s bags at the grocery, topless beaches, or tips in restaurants, we are increasingly force-fed a diet of “what good people do”. That Evanston has a large population of highly educated residents, with the ability to decide most things without outside help, is irrelevant: Big Brother knows best.
We are becoming like Iran, with “Morality Police” prescribing every detail of our lives.
There is a bit of irony in these comments that refer to the high level of education of the Evanston population and how that should provide an expectation of proper self-initiated tipping. Aren’t the ones suggesting mandatory tipping, minimum wage, defunding the police, and affirmative action all from the highly educated class?
High levels of education may enhance knowledge but is irrelevant when it comes to moral and ethical opinions. If anything, a masters degree or doctorate simply provides more rationalization of unethical practices. For example, how does a highly educated person think it is ok to unfairly promote someone based on their race while simultaneously discriminating against another race to accomplish that goal. Many times those other races being consciously discriminated against are minorities with so called historical grievances themselves. A diploma does not justify an immoral opinion nor does it enhance one’s ability to act morally.
Just increase the cost of menu items by 20% instead of imposing the charge.