Originally Posted by Kevin AA

Today I had a revelation -- the tipping system is essentially making the servers and bartenders commissioned workers. Now I can see why there is such resistance to switching over to a no-tip system. No one who works in sales would trade a job that brings in up to $50/hour for a flat hourly wage, unless the rate was really high, which businesses would probably not pay.

Think about it, do you tip at a furniture store? No! Then why are the workers so attentive to the customers (instead of just standing at the cash register waiting for people to say "I want this and that")? It's because they get a low hourly rate plus a commission for selling the merchandise. But the customer doesn't have to determine how much that commission is. That is between the workers and management and it works just fine.

So how about this: at No-Tip Restaurant, the employees make an hourly wage plus a % of sales (for example, $9.00/hour plus 12% of sales). Raises in hourly wage and sales % are available for the better workers.

For the bartenders, if a % doesn't make a lot of sense, pay per drink (e.g., $1 for a beer and $2 for a mixed drink). Instead of charging $3 for a beer and expecting the customer to give a dollar to the bartender, just charge $4 for the beer and add a dollar to the bartender's paycheck.