Joe’s Crab Shack has been testing a new service model that brings an end to tipping for guests. This test is currently being conducted in 18 locations nationwide. No timeline is in place to implement this policy nationally; the company is testing the results of this pilot program.
“It’s simple, really. We believe that consistently great service should always be included in the menu price, so we are taking the responsibility for paying the service staff,” says Ray Blanchette, CEO, Ignite Restaurants. “I personally believe tipping is an antiquated model and you have seen most businesses in America migrate away from it over the last 50 to 100 years.”
No service charge will be added to guests’ bills to replace the gratuity. Additionally, menu prices have been adjusted slightly to account for the added labor cost but the prices are typically less than the average 20 percent service tip.
The new policy, while guest-driven, is likewise intended to benefit Joe’s staff. Servers, hosts, and bartenders will be paid higher, fixed hourly wages, which is expected to result in an improved team atmosphere, greater financial and employment security, and reduced turnover.
“We have a responsibility to give our employees the best possible future while providing the best service to our guests. We look forward to learning more from this pilot program over the coming months,” Blanchette says.