Joe’s Crab Shack is first national chain with no tipping policy

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A day after The Pitch reported that the two metro locations of the Texas-based Joe’s Crab Shack chain — in Olathe and Independence — were among the few local venues serving Florida stone crab during that crustacean’s official season, the 24-year-old seafood operation announced that it was introducing a no-tipping policy in its restaurants, the first national chain to do so.

Last night, the Eater blog was one of the first media outlets to report the news that Ignite Restaurant Group (which operates most of the 138 existing Joe’s Crab Shack restaurants) was dropping tipping and increasing the servers’ salaries from tipped minimum wage to a starting salary of $14 an hour. To accomplish this, Joe’s Crab Shack restaurants are increasing food and liquor prices 12-15 percent.

Will other big restaurant chains follow suit?

Last month, New York restaurateur Danny Meyer, the CEO of the Union Square Hospitality Group, told Fox News that tipping “has lost any value it had” and was dropping the practice from his collection of restaurants including Union Square Cafe and Gramercy Tavern.

“What’s gotten a lot less attention in the media is the customer pushback at the Danny Meyer restaurants,” says Kansas City-based author, restaurant consultant and former waiter David Hayden. 

“The 20 percent extra that Meyer is charging customers is being split between the front and the back of the house,” Hayden says. “It’s a way of redistributing servers’ wages to non-tipped employees to cut labor costs. It’s all pretty absurd.”

Hayden fully expects other national chains to jump onboard with the no-tipping policy, but predicts it will be a short-lived trend.

“I think the big chains are going to try,” he says. “In the end, it’s always a financial decision, and the only reason any business will do this is if the servers’ non-tipped wages are less than the 12-15 percent that the restaurants are passing on to the customers. Trust me, no restaurant has ever done something like this with the best interests of their serving staff in mind.”