What's your experience with Initiative 82?

Submitted by UncleLongHair0 t3_11ctdjj in washingtondc

Went to a large bar/restaurant near Dupont last week. Nothing seemed out of the ordinary with prices, service, or tips. Very friendly bartender, great food, great service, I tipped about 20%.

Went to a small restaurant on H St. last night. We had to order all of our own food and drinks with QR codes. The few service people there seemed overworked and grumpy and barely said a word to us, basically just brought things to the table. The check included a 20% "service fee", which was taxed, and recommended tip range of 15-25%.

So for $60 of food there was $12 for service fee, then about 10% tax for $7.20, and a tip range of $12-20.

I don't know if there is any way to tell how much of the service fee might go to the servers rather than the restaurant, I don't think there is any legal requirement. I'm not up on the very latest of Initiative 82 but I don't think the servers' hourly wage has increased much if at all (it's supposed to phase in over 5 years). So I don't want to stiff them, even though I got literally almost no service at all, but paying $30-40 of service/tax/tip on a $60 tab is completely outrageous, that's 50-65%. I ended up tipping 15% but will never go back to that place.

What are others experiences? Interesting to me that these two restaurants seem to have completely different approaches.

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solidrecommendations t1_ja4y1e2 wrote

It hasn’t gone into effect yet

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rrocketman88 t1_ja7rctl wrote

Seems like most restaurants are complying early right?

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solidrecommendations t1_ja7s8x5 wrote

In what way? You think they’ve already increased hourly wages?

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rrocketman88 t1_ja7svv4 wrote

Yes. There was an article in the WaPo not long ago where they interviewed several owners across town that were already complying and most of them did it with service fees.

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solidrecommendations t1_ja7uwdw wrote

Good for them. The service charges are still confusing garbage though.

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rrocketman88 t1_ja7vk43 wrote

I don’t mind them. It lets me know I don’t have to tip. It would be worse if they just raised prices and didn’t signal that their employees were getting paid $15 and hour.

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solidrecommendations t1_ja7wlak wrote

I don’t mind them either in that sense, but many restaurants are ambiguous about whether the money is for wages or just increased costs and still suggest tipping on top of that. Regardless, I generally don’t tip on top of service fees (as I mentioned to someone else in this thread).

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UncleLongHair0 OP t1_ja50pmv wrote

I get that but it seems like bars and restaurants are changing their policies, or new places are starting out with them, that are intended to work with Initiative 82 once it kicks in. Like why else would you randomly add a 20% service fee to every check? Maybe this is the only place in DC doing it -- I doubt it -- hence my question.

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solidrecommendations t1_ja521y3 wrote

Oh … service fees started to proliferate in the pandemic. I never tip on top of them unless I need to do so to get to 20% (eg I will tip 5% on a 15% service fee). I’ll rarely make exceptions to that rule for outstanding service.

But if a service fee is 20%, I generally don’t leave an extra tip. Gotta keep an eye out for them too, some places are a bit sneaky.

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Ok_Culture_3621 t1_ja52v42 wrote

Same here. If the fee is >=20% I just don’t tip. If less, I do something close to the difference. But there is no way to know if the owners are actually using it to pay their employees and not just pocketing the difference.

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UncleLongHair0 OP t1_ja52wmm wrote

There was a little info icon next to the service fee on the app but all it said was that it "helped the restaurant cover expenses".

I don't think there is any requirement that a "service fee" goes to the staff. So if you don't tip because of the service fee you might just be moving money from the staff to the owner. Which isn't necessarily an awful thing especially if they don't really provide any service but could also screw the staff.

And outside of DC and for services like GrubHub and DoorDash or Amazon grocery delivery, there is no guarantee that the tip even goes to the driver it just goes to either the delivering company or the restaurant. And I have been seeing tips requested everywhere like at checkout, when the person literally doesn't provide any service.

My favorite was at the Union Market cheese shop where the tip suggestions were 20%, 25%, or 30%. I'm going to tip someone 30% for cutting and wrapping a wedge of cheese?

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solidrecommendations t1_ja53i1s wrote

At some point it ceases to be my problem … you get 20% extra on the bill from me, how that is divvied up isn’t my call. I used to work in restaurants and I truly empathize with the workers, but I can’t shoulder figuring out their pay structure when I’m just trying to eat dinner.

To your last point, I don’t tip at retail or pickup only restaurants (except on very large orders).

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spince t1_ja5ppc3 wrote

>I don't think there is any requirement that a "service fee" goes to the staff. So if you don't tip because of the service fee you might just be moving money from the staff to the owner. Which isn't necessarily an awful thing especially if they don't really provide any service but could also screw the staff.

There also no requirement the staff work at an institution where they feel like they're not being fairly compensated.

If staff feel like they're not getting their fair share (or purported value) out of the 20% service fee they can walk.

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ksixnine t1_ja9dj5s wrote

Explain compensation, please..

Before the pandemic/ I82 a person would work a 7hr shift and could earn between $200-$400 based on the evening & establishment.

As is now, with the service fee being added to compensate for healthcare and higher hourly wages, many people are fortunate to make anything above $114 for their 7hrs (and when you include taxes, that’s about $100.)

I do understand workers going somewhere where they are valued; however, the compensation of working in one place over another was built off of tips because very very few places can afford to pay $30-$50/ hr to their bar & waitstaff.

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spince t1_ja9mwh5 wrote

>As is now, with the service fee being added to compensate for healthcare and higher hourly wages, many people are fortunate to make anything above $114 for their 7hrs (and when you include taxes, that’s about $100.)

I'm not sure I follow. Healthcare benefits and higher hourly wages are a workplace benefit and part of the overall compensation package.

I was responding to a poster who implied that the service fee could be going entirely into the owner's pockets. In your example, the service fee was being used specifically to offset better compensation for the staff.

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ksixnine t1_ja9r84s wrote

Ok.

Would you rather make $114 or $200 on a given 7 hour shift?

And, do you understand how the tip credit worked?

Healthcare as a bonus is wonderful - the thing is it could have been incorporated while keeping the tip credit in play.

Edit* it also depends on what the owner wants to do with the service fee: in many cases it is used for healthcare/ inflation, in some cases it is used to pay the kitchen higher wages, etc.. there isn’t any law stating what that money has to go towards.

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spince t1_ja9x0xf wrote

> Would you rather make $114 or $200 on a given 7 hour shift?

If every single factor in the compensation package is equal, obviously more. But that's disingenuous because in your own post you're talking $114 with a guaranteed minimum wage floor + health care benefits vs. one without those things.If you're talking $114 with healthcare or $200 without, it would depend on whether my cost of acquiring private healthcare insurance on my own would be more than $86 per shift.

> And, do you understand how the tip credit worked?

I do!

>it also depends on what the owner wants to dowith the service fee: in many cases it is used for healthcare/ inflation, insome cases it is used to pay the kitchen higher wages, etc.. there isn’t anylaw stating what that money has to go towards.

Which returns to me to my original point - if waitstaff feel like the service fee is not being used to their benefit, they should take their labor elsewhere.Management could also return to encouraging tipping while abandoning the 20% service fee. It's not the customer's responsibility to now do a 40% add-on to whatever they order.

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ksixnine t1_jaatj9v wrote

The $114 or $200 are both with healthcare ~ that was why I asked if you understood the tip credit: healthcare in conjunction with the tip credit was already a thing before the pandemic/ I-82.

Different establishments have different protocols on where the service fee goes, and based on the experience of the server determines whether they can move to a different job or not - it really isn’t as if they are saying ‘I’m not making what I’m worth, so I’ll leave’ and is closer to saying ‘no one will hire me because I’m not experienced enough’ ~ which doesn’t even scratch the surface as to whether they are good or bad at the job.

The reality is management was always on the hook to pay whatever the minimum wage was if sales were low - they grumbled about healthcare, and ironed out what food cost to raise to meet the new labor demands.

Without the cushion of the tip credit, and the rest of the financial responsibilities that they have to contend with, they aren’t going to trim their profit margins — truth be told: the customer has always been responsible for keeping the doors open, and the cost of doing business was somewhat hidden; however, now that certain people demanded that the tax credit be removed in favor of using a standard wage, restaurants are going to pass that responsibility onto you.

The elephant in the room is that the gratuity industry that many detest generates about $48bil annually (yes, just tips..) and that the argument to increase wages/ remove the tip credit was a means to tax food service workers more.

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spince t1_jabsrtm wrote

>The $114 or $200 are both with healthcare ~ that was why I asked if you understood the tip credit: healthcare in conjunction with the tip credit was already a thing before the pandemic/ I-82.

Sorry, your original comment didn't make this clear since you stated the service fee was implemented for health care and higher wages. Your premise keeps changing so it's hard to understand what you're arguing.

The rest of your post is waxing poetic about Initiative 82 which I didn't state a position on and focusing on a very specific hypothetical of a server who wouldn't benefit under initiative 82 so I won't address it.

> the customer has always been responsible for keeping the doors open, and the cost of doing business was somewhat hidden

What I'm arguing is very simple - it's not the customer's responsibility to ensure servers are paid as much as they can get anymore than it's the customer's responsibility to ensure owners profit as much as they can.

My personal tolerance is a 20% obligatory add on fee on the bill. I don't care if it's in the form of a mandatory service charge or a cultural obligation of a tip, because the premise of the tip has long been disconnected from actual service quality.

Restaurants that do a 20% fee and guilt you into tipping on top of that are not places I will patronize.

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ksixnine t1_jac1bsc wrote

Mmm, this entire post, per OP, is dealing with I82… You do understand that, yes?

Dealing with I82 from a consumer or a supplier standpoint, both entities should feel as if they are being treated fairly - true or not?

My asking if you understood the tip credit was to understand how well you understood it pre and post I82 having been passed. Now that we both know your depth: which pay structure [both with healthcare] would you care to be under – $114 (via wage increase) or $200 (via tip credit)

>What I'm arguing is very simple - it's not the customer's responsibility to ensure servers are paid as much as they can get anymore than it's the customer's responsibility to ensure owners profit as much as they can.

-This tells me that you aren’t sincere in what you’re saying … you aren’t grasping your personal role in how this specific economic system works: you cannot argue for the server to go elsewhere for work without understanding your purpose in why sed establishment encouraged you to come in - and yes, that does place you in a position of providing profit for the establishment as you also pay the server’s salary ~ it’s no different than buying a car, or groceries, or getting a haircut .. your choice in doing business at sed establishment keeps the doors open, and people employed.

>My personal tolerance is a 20% obligatory add on fee on the bill. I don't care if it's in the form of a mandatory service charge or a cultural obligation of a tip, because the premise of the tip has long been disconnected from actual service quality.

-Your personal tolerance matters little in this discussion, and cultural norms are just that, cultural norms: when in Rome, do as the Romans do — admit it or not, the tip credit allows for people to help gauge worth/ value based on a rating systems of a food critic (or several), and the premise of a tip has been lost on customers that didn’t have a better grasp on what their meal truly should have been charged ~ without the tip credit, people are clutching their pearls based on a new understanding of the capitalist culture of restaurants and how they, the diner, actually figure in.

>Restaurants that do a 20% fee and guilt you into tipping on top of that are not places I will patronize.

-Most all businesses want to run on the cheapest possible labor that maximizes their earnings without sacrificing service.. if you feel guilty by knowing the truth, what else needs to be hidden from you?

Would you feel better if it was a 35% service fee and no line for a tip?

Would you be happier dining in a prix fixe environment ~ with or without the option of doing prorated ala carte menu items?

Fact is, your disdain by learning the reality of the economics of keeping a restaurant open is exactly what scares restauranteurs — the restaurant industry is difficult, and the ability to constantly trim costs is dwindling precipitously .. the last thing you or I want is for restaurants to take an approach of you being a one time customer, but if that scheme works because it shields you from being better aware of how your dining choice on the evening is keeping its doors open, then more shall follow.

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713ryan713 t1_ja5h7gd wrote

I'm not going to overthink this. 20% for the server is standard as a tip. If they're charging a "20% service fee," I'm assuming that's the tip, and I'm not going to prod further.

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lgy27 t1_ja5izxd wrote

If the restaurant adds on 20%—they can call it whatever they want—I’m not tipping on top of that.

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Existing365Chocolate t1_ja5hfo9 wrote

If they have a service fee then you don’t tip

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jeffreyhunt90 t1_ja5i4d9 wrote

At this particular restaurant (sticky fingers) the service charge is not given to the staff at all.

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spince t1_ja5vuio wrote

If the staff aren't seeing their wage or benefits increasing following the administration of the service charge the staff should find an employer that is more fair to them.

It truly is not your responsibility as a customer to solve.

Trying to solve an employer/employee problem by putting it on the customer through tip inflation is going to result in more customers staying home in the long run and that's bad for restaurant owners and servers alike.

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wandering_engineer t1_ja7btpq wrote

>Trying to solve an employer/employee problem by putting it on the customer through tip inflation is going to result in more customers staying home in the long run and that's bad for restaurant owners and servers alike.

Absolutely. I have always hated tip culture with a passion (it's so stupid, just charge what I'm supposed to pay), all this service fee BS makes it even worse. Really just turned me off to going out to eat or drink at all post-COVID, I rarely do anymore except for the occasional take-out. I have sympathy for restaurant workers but I also have no doubt many others feel the same way and are just fed up with dealing with it.

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invalidmail2000 t1_ja5rrew wrote

It sucks for the workers sure, but you're just rewarding this restaurant by also tipping. If nobody did or stopped patronizing them they would either fix what they were doing or have a hard time finding staff

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jeffreyhunt90 t1_ja55r95 wrote

Sounds like you went to Sticky Fingers.

When I heard about their policy, I immediately left.

And im vegan.

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Throw_acount_away t1_ja59x7z wrote

Yup, it's good but my server specifically said the service charge was not the tip. I felt bad and threw on 10%, but it's really crappy of them

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jeffreyhunt90 t1_ja5hxs3 wrote

I’m going to send them this post to hopefully change their minds. I won’t go back until the policy is changed.

Raise your prices. Don’t scam your customers.

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IcyWillow1193 t1_ja7e5ru wrote

>Sticky Fingers.

Sticky Fingers has been in a sad, long slow decline for years but the pandemic really accelerated it. I used to love it but at this point I wish the owner would just move on and make room for something good.

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orion2145 t1_ja61l9s wrote

Love sticky fingers but if this is true I’ll just skip it.

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FennelSuperb7633 t1_ja8oulu wrote

Sticky Fingers is such a ripoff now. It cost me $68 for two cups a coffee, a pastry, and pancakes when I include the service charge and tip. I’ll never go back!

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NavyYardBro t1_ja5c12t wrote

I’m not paying 40% extra.

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WontStopAtSigns t1_ja5cwum wrote

Ya fuck that place. Tell me the price of what I'm buying or we don't have an agreement for me to pay.

I don't want a goddamn algebra equation to guess what my bill will be either. I will assume anything extra is the gratuity, and 100% optional (up to me). There isn't going to be any extra gratuity when the person I ordered from hands me a surprise bill >20% than what I ordered.

Nope.

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LoganSquire t1_ja5uvkh wrote

Don’t let restaurant owners gaslight you into thinking these fees are because of I82, which hasn’t even gone into effect. This is just some restaurants trying to milk another 20% out of your pocket.

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EverybodyBeCalm t1_ja5zn7c wrote

Everyone hates seeing extra fees, I just will never understand why they don’t just include these in the prices of their menu items. Then people won’t feel bamboozled at the end.

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Def_Probably_Not t1_ja7l3tp wrote

Agreed. I went to one restaurant that had a little sticker on the front that simply said something along the lines of, "We apologize, but our costs have increased, and we had to make the unfortunate decision to raise our prices by 10%". And I appreciated that approach.

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UncleLongHair0 OP t1_ja9vzqg wrote

It's funny I would probably not complain about a food price going from $9 to $11 but a 20% "service fee" seems ridiculous.

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baesoonist t1_ja6atem wrote

Service fees that aren’t going to staff are absurd and make no sense- the food is already marked up to make profit.

I’ve been to one restaurant (Pizza Paradiso) that has started incorporating an automatic 20% service fee that goes entirely to the staff. Besides having signs and notes about it around the restaurant, when you go to pay the suggested tips are something like 3% 5% and 7%, in case you want to throw a little something extra that goes directly to that server for outstanding service.

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Docile_Doggo t1_ja5e8ul wrote

If you have a service charge of 20%, the customary standard tip percentage, I’m going to treat that as the tip. And I’m not going to feel an ounce of guilt for not tipping another 20% on top of that.

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TravelerMSY t1_ja4y675 wrote

Well, if they’re going to include service, why add more? Especially when you didn’t get much?

This is Reddit, so there probably won’t be any consensus.

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godlovesugly t1_ja50cp3 wrote

Will you name the H St restaurant so I can avoid it?

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supitsgreg t1_ja6aqw1 wrote

If a restaurant has a service fee, then that is the tip 😂✌️

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NorseTikiBar t1_ja69wnm wrote

I think this is just showing how we should expect service fees that don't go to the waitstaff have an effect on the experience: negatively. I've been to a few places that have the service charge that explicitly calls it out as going wholly to the staff and I haven't seen a difference between those and ones that don't have a service fee where I'd be expected to tip normally.

Of course, this whole sorting process is only going to become more clusterfucked and it's the public and the service employees at these shitty spots that will suffer.

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t-rexcellent t1_ja6i8e2 wrote

I-82 hasn't gone into effect yet (and when it does, it will be very gradual over a few years). When it is in effect, it will be very reassuring to know that even if a restaurant charges a "service fee" that doesn't go to staff, and if patrons choose not to tip because of that, the waitstaff will still earn a living wage like all other workers in the city.

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wandering_engineer t1_ja7cctk wrote

Not sure why you're being downvoted, it's true. And tip culture is really a terrible practice - pay your employees a fair wage, set your prices accordingly, any tip should then be optional (no expected 20+%). That's how it's done in the rest of the world (here in Europe I just round up and rarely tip more than a few dollars), and quite frankly it makes eating out a much more pleasant experience.

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ksixnine t1_ja97kjd wrote

Sorry, I’m not tracking you — most of Europe incorporates a service fee into their meals, and outside of Iceland & Scandinavia *where tips are not expected (5-15% based on where you are) are expected ~ which is pretty much the same as what is happening here in DC currently. leaving extra isn’t necessary but is nicely appreciated; however, if a service fee isn’t included a 5-15% is expected based on where one is ~ Switzerland on the other hand wants 10% on top of their service fee. Currently in DC we are watching all of these models play out to see which works best going forward.

*edited, because brain thinks faster than typing correctly

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wandering_engineer t1_ja9b06b wrote

If there is a service fee, it's rolled into the price. None of this "it isnt the real price" BS. And 5-15% is not expected in most of Europe. I live in Sweden, previously Germany and have visited a large portion of the continent and have never paid more than a few Euros unless it's truly exceptional service. All of my local coworkers do the same, we don't need US tip culture here.

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ksixnine t1_ja9iapt wrote

I did say it was optional in Scandinavia.. and in Germany they bake in and bang you for both a service fee and a VAT, so yeah your leaving a few Euros if you care to is really at your discretion.

My prior comment wasn’t clear: in most EU countries a service fee is included, and leaving extra isn’t necessary; however, if a service fee isn’t included a 5-15% is expected ~ Switzerland on the other hand wants 10% on top of their service fee.

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wandering_engineer t1_ja9lb9e wrote

Yes that was my point - tipping is nice but generally not expected. Compare that to the US where 20% is now apparently the bare minimum and you're considered nothing short of a monster if you don't tip (and many people will roast you for even 15-18%, I've seen it happen).

I am hoping that the new initiative will nudge people towards the European model but am afraid it's too ingrained.

EDIT: and again service fee and VAT is rolled into the price. If that burger is €15 on the menu, you pay €15. None of this deceptive adding a service charge, then adding sales tax, then expecting over 20% more on top of all that. You get banged both ways in the US too, the only difference is Germans are at least transparent about it.

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ksixnine t1_ja9w7t6 wrote

It isn’t that ingrained, and people will adjust; however, the financial compensation isn’t there at present.

Too many people thought of/ wanted to treat this job like any other 9-5 where you get paid X/hr with a chance to make extra — the problem is that they didn’t want to put in their apprentice time and expected to make Four Seasons type of money while working at a Cracker Barrel.

Yeah.. no.

The other problem is that you’ve people that were earning $30-$50+/hr on the old system — very few places can honestly charge enough to actually make that type of financial compensation.

I do understand the frustration of feeling cheated here in the US- it sucks for you and the server. I also understand the fear that restaurants have over profit margins being thin.

Ultimately it’ll be a hybrid system similar to San Francisco (although DC doesn’t have that type of expendable cash..) where QR codes & fast casual fills most of the void, and going out to eat at a regular restaurant becomes a special treat vs a normal experience.

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ksixnine t1_ja94x41 wrote

There’s no incentive for anyone to work in many restaurants vs a grocery store or a 7/11, just none - for that matter, there will be a dearth of talent at lower end establishments because they are now working for a paycheck which is less that what they would’ve earned otherwise.

The lack of using the tip-credit, in conjunction with restaurants paying for healthcare and increasing wages (with or without inflation adding to the issue) is going to clamp down on the mom & pop places, and give way for corporate backed companies to fill the vacancies.

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t-rexcellent t1_ja9bucm wrote

Well, they might enjoy working in a restaurant more than working at a grocery store, even if the pay was identical. But I think many restaurants will still pay better and hire more professional staff than a convenience store or a minimum wage employer. And I think many patrons will still continue to tip. Keep in mind that there's nothing forcing restaurants to charge a service fee -- that's just something they came up with during the pandemic (which was justified, I know) similarly to how airlines realized they could charge you for carry on bags. Lots of restaurants won't do it (and many who do it now may cave under pressure to get rid of their fees).

Of course ultimately the voters have set the law and we'll just have to see what happens!

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ksixnine t1_ja9fol4 wrote

Restaurants have a smaller margin than convenience stores, and are more than happy to send employees home if service is slow - grocers, not so much based on how labor is spread out due to products arriving ~ you can’t be guaranteed 30+ hrs a week in a restaurant, but you can be at Trader Joe’s.

And they do have an incentive: with I•82 on the horizon there isn’t a smart restaurant that doesn’t want to get ahead of the curve now vs five years down the road.

Service fees for DC are mostly pandemic related; however, California/ Wash St/ Nevada.. have been utilizing this practice for quite a while, thus I don’t see too many DC establishments getting rid of it - especially if this is how they are making their ends meet.

Ultimately, yes, DC voters put this into motion, because they didn’t understand the tip-credit.

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Camdc1234 t1_ja6dw3s wrote

A lot of what you are describing has been going on since the pandemic, and I would attribute this to behaviors restaurants began during the height of the pandemic, and some just never stopped, or some learned from adapting to COVID but now use indiscriminately

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UncleLongHair0 OP t1_ja9w5si wrote

I've never seen a 20% service fee at a restaurant before.

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Mad-Dawg t1_ja66pv5 wrote

The wage doesn’t start to gradually increase until May through, IIRC, 2027.

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rrocketman88 t1_ja7rs4b wrote

There was a WaPo article that interviewed several local restaurant owners and they said that they were already complying with 82 and they are adding the service fee as signal that their employees are payed appropriately. I'm for it because I don't want to go to a place where it isn't clear and tip an employee already making $15+ an hour.

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BrightThru2014 t1_ja82vyq wrote

I only cover the difference between the service fee and 20% tip FWIW (sometimes this is $0).

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ArmsofSleep t1_ja7kui4 wrote

Thought I’d read every single Nextdoor grandma complaint about service fees but I guess I forgot we are in for a rash of “why would Initiative 82 do this???” years before it takes effect

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CrankyBloomingdale t1_ja818sj wrote

Wait you can’t “have your cake and eat it too”? 82 was a turd and now servers are having a “hey…wait I don’t get tips on top of that 20% service fee “🤷‍♂️🤷‍♂️🤷‍♂️moment. Tipping now goes away and I thank each and every owner who has removed the tip line ( examples - 2 Amys, Duck and the Peach) and explain the costs are now “baked in” (and I wouldn’t care if an x% service charge now covers 82 compliance - no need for additional).

To the jackalopes who pushed this - you get what you get 👍 and now that you are making higher $$$ there is no need to tip.

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ksixnine t1_ja9623m wrote

The only servers that are just now realizing that they have eaten into their earnings are the ones that voted for I•82.

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CannaVet t1_ja8fk1n wrote

So many businesses busting ass to drain customers and employees at all costs then surprised pikachu when people stop caring. I'm in more rural Virginia and the prices on the delivery apps have just consistently kept creeping up so I finally deleted em.

For $30+ for a $12 meal I can feckin almost just uber there to eat and back.

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