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Servers at Joe's Crab Shack will no longer depend on generous patrons to earn a decent wage.
Owned by Ignite Restaurant Group, which also runs Brick House Tavern + Tap, the seafood restaurant is the first major chain to eliminate gratuity.
Servers will be paid $14 an hour or more, depending on past
performance, according to Restaurant Business. The move is expected to "result in an improved team atmosphere, a significant reduction in turnover and greater financial security for employees," said Ignite CEO Raymond Blanchette during a recent earnings call. Food prices will increase by12 to 15 percent to help fund the wage raise.
Joe's Crab Shack has already banned gratuity at 18 of its restaurants; plans are in place to extend that ban to all 130 U.S. locations. The chain took to its official Facebook page this afternoon to elaborate:
Hey y'all. You may have heard that we've been testing a new, no-tipping service model in select locations. We're still in a testing phase and don't have a timeline yet on when or if this would roll out to all locations. With this new service model, staff will be paid a higher, fixed hourly rate and guests will no longer be obligated to tip. We are still testing this and taking guest and employee feedback into consideration.
The new policy comes on the heels of an October announcement from Danny Meyer—founder of Shake Shack and New York's Union Square Hospitality Group—on plans to end tipping and increase wages at 13 of his restaurants.
[via Business Insider]
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