Recently, Danny Meyers, a prominent New York restaurateur, declared that his restaurants will slowly remove tipping in his restaurants and raise their prices to compensate workers more appropriately. Now the first major restaurant chain in the US is doing the same. According to Eater, Joe’s Crab Shack’s, “servers will start at $14 an hour and the bumped wages will be offset by the price increases of 12 to 15 percent.”
What pushed the restaurant chain to drop tipping? Ray Blanchette, the CEO of Ignite Restaurant Group (Joe’s parent company), “recently told investors the move should reduce staff turnover, improve service quality, and actually lower prices for customers who are typically more generous with their tipping.”
Following the lead of Meyers, Joe’s Crab Shack may spark interest in other major restaurant chains to do the same.