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US restaurants adopt tip-free pricing to pay staff directly
One tip-free operator said shifting from tips to higher menu prices also raised sales tax costs, contributing to at least one restaurant switching back to tipping.
BBC Business profiles a small but growing number of US restaurants that charge higher set menu prices and do not accept tips, arguing that front-of-house tips can be uneven and can leave staff reliant on customer generosity rather than steady wages. In San Francisco, La Cigale charges $140 per person and pays higher salaries, with staff arguing that tipping can reduce effective earnings when workers are paid only parts of the day rather than continuously. The restaurant tells diners, “What you see is what you pay,” and frames return visits as the only form of customer reward it wants. In Massachusetts, Nightshade Noodle Bar owner Rachel Miller moved to a tip-free model after reopening following the Covid-19 pandemic, saying kitchen workers were taking home a smaller share than front staff for similar hours. To cover higher wages, Miller raised prices, with tasting menus starting from £102 for seven courses before 6pm and $126 for nine courses, and she said the higher costs reflect paying staff properly. Not all tipless efforts have lasted. Talulla in Cambridge dropped tips in 2020, only to switch back in September last year, with co-owner Danielle Ayer citing limits to sustaining a 23% menu price increase through the winter months, noting that while tips do not count as revenue, menu price hikes do and therefore affect sales tax.