Six in the Six: half a dozen burning questions for Hemant Bhagwani, the restaurateur who’s doing away with tipping
At his new restaurant, Indian Street Food Company, Toronto restaurateur Hemant Bhagwani (founder of the Amaya chain) has introduced a radical new “no tipping” regime. He says the move promotes a happier work environment, from the dish pit up. Here, we quiz him on why he did it, whether it’s working and how to handle crappy service in a no-tips environment.
Torontonians have been tipping since the dawn of time. What inspired you to switch to a no-tipping policy?
I was inspired by my desire to create a more equal work environment. Over my years of owning a number of restaurants, I’ve noticed the huge disparity of earning. A lot of cooks want to become servers. Even people who were coming out of great culinary programs like George Brown were trying to switch to serving jobs, and you can’t blame them. Servers come in for four or five hours, and they might walk out with $250. These guys in the kitchen would work from noon until 10 p.m. and not even make half that. It’s not a fair system.
Back in my serving days we tipped out the back of the house. Is that not standard anymore?
It is, but it’s: this guy’s getting half a per cent, that guy’s getting half a per cent. It’s not enough, and it makes it impossible to keep good people. Look at the dishwasher. That’s the hardest working guy in the restaurant, and it’s just totally thankless. It’s no wonder we could never keep anyone in that job. It was always a new guy every week or every two, or someone just wouldn’t show up and I’d end up washing dishes in my restaurant.
Okay, so how does abolishing tipping help Johnny Dishwasher?
It depends on how you execute it. A lot of places just spike the cost of the food by about 15 per cent, but I wanted it to be more transparent. So what I did was add a 12 per cent administration fee to every bill. That’s 12 per cent on the net sales, which works out to 10 per cent of revenue. That extra money gets distributed amongst everyone. The idea was to be able to create a restaurant where the staff are happy and where they understand that the money they make is directly related to the sales.
What about the customer, though? If you’re charging a 12 per cent admin fee, isn’t that just a tip by another name?
It’s less expensive than tipping, and it makes paying your bill at the end of the meal an easier experience.
What do you say to the complaint that by taking away tipping, you’re denying customers their one recourse against crappy service: not tipping?
I think tipping is such a norm in North America. Even when people aren’t happy with their service they leave 10 per cent. At my restaurant, if the service is bad, I want people to come and tell me. We won’t force them to pay.
There are a few notable American restaurants that have made the same move to no tipping. Is this the way of the future?
I have gotten phone calls from a couple of restaurateurs who are interested in starting the same thing, so that’s a good sign. We’ll see. I think there are lessons to be learned. There will be tweaks along the way. And who knows—maybe it won’t work. At this point it’s an experiment. I was speaking to one restaurateur who said I was either really brave or really stupid.