While Andrea, Ed and Karen all utilize alternative payment models in their restaurants, barcito's (Los Angeles) model is service included, Magpie Cafe (Sacramento) offers a kitchen gratuity line and Sycamore Kitchen (Los Angeles) has instituted a service charge model.
Below are the top 10 quotes from the panel discussion:
1) “I think I talked about it a little bit – the broken system that I’ve worked in for so long. The tension and animosity that can build between the front-of-the-house and back-of-the-house, who in our places are trying to make a career out of this. Versus the front of the house, who are not looking to make a career out of this and are making a lot, a lot of money." -Karen Hatfield
2) "I think the number one rule is: you need to have perfect employee communications. You need to make sure if you are transitioning, you communicate in an effective and fully transparent way to your employees." -Bruno Katz
3) “We are a little bit at a loss of where the culture of dining goes without gratuities…For our servers, most of the reason they are in the business is the tip as far as we can tell…Fundamentally, the culture on the floor is going to have to change without gratuities.” Ed Roehr
4) “Some of the challenges have been that they aren’t motivated to turn tables as a server would be if they were living off tips or to up-sell as you’ve seen in the past. Probably from the customer’s point of view those are two things that could be seen as a bonus.” Karen Hatfield
5) “There are two main aspects to this. One, the opportunity to reward and incentivize our top performers as opposed to it being kind of random, or the night that you worked, or a guest that you really wowed. We wanted to really improve the work experience, provide healthcare and to legitimize restaurants as a place to work and have a career.” Andrea Borgen
6) "In the old model the servers were actually creating a tip pool on their own outside our understanding, but what we understood was that they were tipping out the kitchen about 10 percent at the end of the night. So the first thing we were able to do was to explain to them that under this model they would not longer be obligated to give that side tip. Therefore, they wouldn’t be responsible for the tax portion of that 10 percent. The other way that we were able to demonstrate this to them: When January comes you guys are getting a $1 raise and the rest of the house isn’t." -Ed Roehr
7) “Guests in New York are really aware of this movement. It’s gained so much momentum in New York. They kind of understand why its happening, but they are still incredibly resistant to it…People in Los Angeles really haven’t heard what’s going and on and don’t realize how the minimum wage is going to impact restaurants, but are incredibly receptive.” -Andrea Borgen
8) "More than the money, it turned out having that the conversation closing the deal with the guest was the big issue for the food server. Having to have that conversation about politics and math at the end of the experience was really the biggest part bringing them down." Ed Roehr
9) “I think that that (service included) is a great way to do it and that it is probably the future. I think there are a couple of reasons. We have a higher price point there, and sticker shock is a real thing. I think it would be really hard for people to see those numbers, and I think it would have a huge impact on our business right now. I think if a greater amount of restaurants transitioned to that in the future – that probably will happen – I assume the service charge will not be around that long. I think it is a bridge model. I don’t see this as being the long term solution.” -Karen Hatfield
10) "Understand that when you have a service charge, you’re not dealing with the tips anymore, you’re dealing with wages now." -Bruno Katz
All quotes have been lightly edited for clarity.