No-tip trend slow to catch on at Hawaii restaurants

Nestled in a cozy, L-shaped space at the newly constructed 808 Center on Sheridan Street, Urban Bistro opened its doors in August as a no-tip restaurant, following an increasingly popular trend in cosmopolitan U.S. cities such as New York, Chicago and San Francisco.

“It’s working out really well for the customers and the staff,” said owner Margaret Lin.

The issue gained traction nationally in October when New York restaurateur Danny Meyer announced that tipping would be eliminated — and wages increased — at all 13 restaurants in his Union Square Hospitality Group, including the Modern inside the Museum of Modern Art. In California, restaurants like Atelier Crenn in San Francisco and Comal, a Mexican eatery in Berkeley, eliminated tipping, adding a 20 percent service charge instead.

The no-tipping movement is meant to address the inequity between front-of-the-house staff such as servers, who get tips, and back-of-the-house workers such as cooks and dishwashers, who do not.

Still, few restaurants here have embraced the no-tipping formula, although there’s evidence customers would appreciate it.

Urban Bistro surveyed diners when it first opened and found support for the no-tip concept. Although patrons place orders by marking their choices on a sticky note, servers, called hosts, deliver the orders, pour drinks and clear plates. The restaurant does not add a service charge to the tab, but factors it into menu prices in order to pay its 10 workers above minimum wage. Still, Lin said the restaurant’s menu prices remain competitive with other eateries.

“It is chosen to encourage everyone to work as a team and focus on the right priorities in gratitude for (customers’) business and not for gratuity,” said manager Richard Smith. “When the team succeeds, the customers are happy. When the customers are happy, the company succeeds. When the company succeeds, it can reward all the employees accordingly in the form of higher wages and more benefits.”

Gregg Fraser, executive director of the Hawaii Restaurant Association, said he thinks local businesses are waiting to see how the trend develops on the mainland.

“There are too many variables for anyone to jump right out and say this is the way to go,” he said.

There are about 3,200 eating and drinking establishments in Hawaii, accounting for 58,300 jobs, according to the National Restaurant Association.

Under the 2016 tip credit law, Hawaii employers may pay up to 75 cents an hour less than minimum wage — currently $8.50 per hour — if the employee receives enough tips so that they are pocketing $15.50 per hour.

Hank Adaniya, a former Chicago restaurateur who runs Hank’s Haute Dogs in Kakaako, said he likes the no-tip idea in principle but that it might take a long time for people here to get used to it.

“In Hawaii, especially, people want to do it because there’s a disparity between the pay and our cost of living,” he said. “It’s almost mandatory to help out.”

Hank’s is a quick-service restaurant where customers order and pick up at a counter, with no tips required. Even then, Adaniya said he put out a tip jar after six months in business because customers suggested it.

An informal survey of diners at Urban Bistro indicates many are ready for the shift in dining culture.

Suzanne Uratani of Makiki said she is a conscientious diner who supports restaurants that emphasize locally sourced ingredients and provide value for her money.

“Couple that with my social-justice sense that every worker deserves a living wage and it’s a given that I would support the no-tipping idea,” she said.

Kristine Choy of Honolulu said she liked the convenience of not having to deal with tipping.

“I know exactly how much I’m going to spend,” she said. “The tips and tax (are) already built into the price of the food and become hassle-free in the end.”

Depending on the quality of service, Choy typically tips between 18 and 20 percent of the bill. She said she had a great experience with the service at Urban Bistro despite not leaving a tip.

Bill Comerford, owner of several Irish pubs, including Kelley O’Neil’s and the Irish Rose Saloon in Waikiki, said he doesn’t think a no-tipping policy would work in the bar trade.

“It’s cultural in the U.S.,” he said. “Part of the business of getting a drink is knowing your bartender, and you get to know your bartender by tipping him.”

Comerford, who sometimes finds himself explaining the practice of tipping to visitors from places where it’s not customary, including Australia, New Zealand and Japan, said it’s an American tradition to reward those who give prompt and attentive service.

“Some guys make good tips because they give good service,” he said.

Laura Woodall, a bartender at Cha Cha Cha Salsaria in Hawaii Kai, agreed. Without tips, Woodall feels her rapport with customers would suffer.

“A lot of customers have been my customers for 10 years,” said Woodall, a single mom with more than 25 years of experience as a server and bartender.

“No matter how high they raise the wage, I don’t think it would make up for (the tips from) the great customers I’ve built over the years.”