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New York Restaurants Sued For Adding Illegal Tips

New York Restaurants Sued For Adding Illegal Tips


Celebrity tennis pro filed a class-action suit against Midtown chains

Wikimedia/Andreas Praefcke

It's not legal in New York to add service charges to listed prices except for parties of eight or more, but one New Yorker says it's been happening anyway, and he's filed a class-action lawsuit to stop the practice forever.

Ted Dimond, a tennis pro who teaches celebrities like Naomi Watts and Liev Schrieber to improve their swings, says several Midtown restaurant chains, including Olive Garden, Red Lobster, Ruby Tuesday, and Applebee's, have been illegally adding gratuities to the checks of smaller groups of diners.

Dimond's lawyer was careful to state that his client also dines at more upscale restaurants where illegal tipping happens, but that they chose to take on the big chain restaurants because they were the "most egregious violators," according to the NY Post.

Dimond's suit claims the restaurants have engaged in willful price fixing that "has jointly raised the prices of dining in restaurants while simultaneously lowering the quality of products and services."

The class-action suit seeks $50 plus $1,000 for "willful violations" where Dimond says customers are tricked into adding a second tip on top of an automatically charged gratuity.

Cathleen Duffy of the Marriott Marquis in Times Square, one of the venues named in the suit, said the hotel's Crossroads American Kitchen and Bar charges an 18 percent gratuity on parties of six or more, which is stated on the menu, but that she was unaware of the NY law specifying that automatic gratuities could only apply to parties larger than eight people.


5 New York City Bars and Restaurants That Changed History

Anyone who has ever had a favorite eatery shut down knows how intrinsically these establishments can be linked to our own history: be it your favorite bar in college, the place where you got engaged, or your go-to comfort spot establishment. In a broader context than our own lives, some locales have been tied to major movements that have had impacts far beyond their immediate neighborhoods, too.

“When you look at New York City, restaurants and bars are more than just places to drink, they’re really anchors of our community, and they take on social and historical significance,” said Andrew Rigie, executive director of the NYC Hospitality Alliance.

Here are five still-operating New York City establishments that you’ll want to get to know.

The 21 Club

21, which has evolved into a bar room, a restaurant, and private event space since opening in 1930, is one of the most iconic restaurants in New York and a favored haunt of many Hollywood celebrities. Its roots stretch back to the Prohibition era, when it became a popular speakeasy (and a secret wine cellar with a revolving bar that kept booze out of the authority’s view). Though famous folks like Frank Sinatra, George Steinbrenner, and Joan Rivers frequented the restaurant for its classic American fare, like its famed chicken hash or 21 burger, the establishment has also had an undeniable impact on how we drink.

“When you look at this country during Prohibition time, the 21 Club was a significant restaurant and speakeasy that people went to, and post-Prohibition it’s had celebrities and business people going to the restaurant to kind of capture a piece of history,” said Rigie, adding that people who have worked there have spawned interest in the cocktail movement that has swept the nation in recent years. “Almost every restaurant you go into has a craft cocktail menu, and even chain restaurants [do now, too],” he said. “People care about the quality of the product and that’s true for cuisine and cocktails. It’s an art, and what [people have been] able to do with some of these cocktails, many of them are Prohibition-era cocktails, so you’re bringing back drinks that were consumed many years ago.” Have a mixologist at your favorite hometown bar? You can thank 21 Club for keeping the tradition of cocktails alive through the years.

McSorley’s Old Ale House

How many bars do you know that have been involved in precedent-setting court cases? Well, McSorley’s, the oldest continually operating bar in New York, is one of them. “It has survived over a century [and] a half in a city where most pubs are lucky if they last a decade, which I think is the biggest continued draw of the bar,” said Maeve McNamara, former bartender and daughter of current owner Mathew Maher. “New York changes so quickly, and so I think people are drawn to something that has been open for so long and hasn't changed very much. Continuity of that degree is really uncommon, and I think that is what makes us special and so dear to our customers' hearts.” McSorley’s hasn’t just been a watering hole for celebrities (though of course, there’s that, too, with everyone from Abraham Lincoln to Justin Bieber stopping by), but it has also been the subject of various creative works over the years, including poetry by E.E. Cummings, paintings by John Sloan, in addition to books and plays.

But back to that court case. Many people know the bar, McNamara said, because up until August 1970 it was a men-only establishment. Women were eventually allowed in after the National Organization of Women sued claiming that the discrimination was a violation of constitutional rights, and won. The bar now welcomes all patrons (a mix of college students, tourists, and colorful regulars) that come in to toast with either house light and dark ale (no hard liquor here) and eat hearty pub fare like corned beef hash or a cheese platter (consisting of New York cheddar, raw onions, and saltine crackers) at communal tables. Paul Freedman, author of “Ten Restaurants That Changed America,” said one major category of restaurants that have a historical impact are simply those known as survivors. McSorley’s among them. “It’s so unchanged that is has become everyone’s idea of what a pub should be,” he said.

Fraunces Tavern

There are plenty of restaurants throughout the country that have hosted modern day presidents, but few that have done so for the first. Fraunces Tavern is one of them. “Not only was it a favorite watering hole for founding fathers like Alexander Hamilton, John Adams, and George Washington, but most notably, it is where George Washington bade farewell to his officers on Dec. 4, 1783 following the end of the American Revolution,” said Jessica B. Phillips, executive director of the Fraunces Tavern Museum. Fraunces, which still serves drinks and food, now also provides the community with an opportunity to explore the American Revolutionary era at its adjacent museum.

Since its Revolutionary War days, Fraunces has expanded, with its museum and tavern occupying five separate buildings on Fraunces Tavern block, a historic district on the National Register of Historic Places, with each room’s decor keeping with the style of the building, said Amy King, marketing coordinator for the restaurant. Meanwhile, the Porterhouse Bar at Fraunces Tavern boasts an impressive collection of craft beers, Fraunces’ whiskey bar has a specialty collection of over 260 world whiskeys, and its hideout bar serves as a sports bar. “While we still have some very traditional tavern menu items, our menus have changed over the years to suit modern tastes and trends while still staying true to the tavern's roots,” King said. Guests from near and far can nosh on the restaurant’s slow-roasted chicken pot pie, traditional fish and chips, or filet mignon on a stone at the place where George Washington once hung his hat.

Julius’

It might not sound like ordering a drink would create history, but that’s exactly what happened at Julius’ in 1966. Before the famed riots at the Stonewall Inn, which kicked off the gay rights movement, the gay rights group Mattachine Society organized a “Sip-In” at Julius’ to challenge an unwritten rule that allowed bars to refuse service to LGBT patrons, said Ken Lustbader, co-director, NYC LGBT Historic Sites Project. “The bar has been around the mid 19th century. Not only is it historical in that it’s been serving food for so long and that the interior is intact from what we believe is right after Prohibition, but it’s the site of an important LGBT sort of civil disobedience over 50 years ago,” Lustbader said. “The Sip-In was one of the earliest public displays of LGBT civil unrest. At the time if you were LGBT and went into a bar and said you were a homosexual you could be refused service because LGBT people were considered disorderly.” The Mattachine Society went into Julius’, ordered drinks after saying they were gay with the press in tow to shed light on the unfair practice. This “helped pave the way” for diminishing harassment for LGBT individuals at bars and restaurants, Lustbader said.

Since then, Julius’ has undergone a gradual transformation, going from a sports bar in the 1940s and 1950s, to a gay bar in the late 1960s, 1970s, and 1980s, Lustbader said. Now, it’s the longest continually operating gay bar in New York City and is a gathering place for a large swath of people—diverse in ages and attracting local people and visitors. “People really recognize it as a safe place and has a wonderful patina of history that recognizes its LGBT past but is also very current,” Lustbader said.

Delmonico’s Restaurant

If you enjoy fine dining, you can thank Delmonico’s for creating the concept. The eatery, which opened its doors in 1837, was largely thought to be the finest restaurant in the United States in its early days, said Freedman, and was known for revolutionizing New York’s financial district and making it a destination for gourmands. “It defined fine dining more than any other restaurant” Freedman said, adding that it prioritized service in addition to quality in a way that has set the bar for other fine dining establishments, and is responsible for being the first to serve up some American staples like Baked Alaska and Lobster Newburg (classics that are still on the menu today).


Pentagon chief Austin getting silent treatment from Chinese generals

A Wisconsin group is suing the Biden administration on behalf of a Tennessee business owner, claiming that it is giving preference to restaurants and bars owned by women and minorities for COVID relief funds — adding that white men are being “pushed to the back of the line” for assistance, according to a report.

The lawsuit, which names Small Business Association Administrator Isabella Casillas Guzman, was filed for Antonio Vitolo, the owner of Jake’s Bar and Grill in Harriman, Tenn., Fox 17 in Nashville reported.

It was filed in federal court in Tennessee by the Wisconsin Institute for Law & Liberty and targets the $28.6 billion Restaurant Revitalization Fund, which is only processing applications from “priority groups” — women, veterans, or “socially and economically disadvantaged individuals” — between May 3 and May 24.

Broader eligibility for assistance opens up after that period.

Isabella Casillas Guzman attends a Senate Small Business and Entrepreneurship Committee confirmation hearing on Feb. 3, 2021. Tasos Katopodis/Pool Photo via AP, File

Vitolo said he applied for the COVID aid on May 3 but was told he didn’t qualify because he is white, the suit says.

It claims the distinctions are unconstitutional and calls on the administration to halt the payments until an equitable system is in place for distributing them, like first-come, first-served.

See also

Disabled white farmer sues Biden admin over ‘racist’ COVID relief plan

“Given the limited pot of funds, this puts white male applicants at significant risk that, by the time their applications are processed, the money will be gone,” the lawsuit says.

Vitolo’s wife, who is Hispanic and owns half the restaurant, isn’t eligible under the rules because a business is required to have a 51 percent ownership by someone in the “priority groups” to receive the aid.

“I do not want special treatment. I just want to be treated equally under the law. I am opposed to race and sex discrimination, and I would hope my government lived up to the same principle,” Vitolo said in a press release from the group.

The Wisconsin Institute for Law & Liberty has also sued the Biden administration on behalf of white Midwestern farmers over its COVID loan forgiveness program that gives preference to black farmers.

Joe Biden turns to Small Business Administration chief Isabella Casillas Guzman as he signs the “Paycheck Protection Program (PPP) Extension Act of 2021” into law in the Oval Office on March 30, 2021. REUTERS/Jonathan Ernst

The SBA announced this week that it began distributing payments to more than 16,000 applicants.

The Biden administration has said more than 186,200 eligible businesses applied for the financial help in the first two days of the program.


The Fixe Is In: More Restaurants Adding Automatic Tip to Bill

A little sleuthing by the Post has turned up about a dozen NYC restaurants which have been tacking a 15-20 percent gratuity onto the bill regardless of party size and without noting the policy on the menu. One disgruntled diner, Dazi Chen, tipped off the tabloid after finding a 20 percent "autograt" charge on his check at Midtown's Bombay Eats, where he dined with a friend. "I felt cheated and taken advantage of," Chen fumed. "They're trying to get double gratuity." It's illegal for restaurants to automatically charge a gratuity without notifying customers, and it must be a party of eight or more. But at the River Cafe in DUMBO, two diners from England recently discovered an unannounced 15 percent gratuity on a $400 check, even though the menu reads, "Gratuity and sales tax not included." A manager denies it, but it sounds like a case of tourist profiling by waiters, who always complain about paltry tips from foreigners. Check out the full list of restaurants angling for gratuitous gratuities here.


Why Tipping Should Be Outlawed

Many people don't understand what a tip is for, mainly because it's not the way we choose to compensate most of our other people-facing professions. Imagine if when you went to the doctor, you decided how much he got paid based on how happy you were.

It was the coat check tips that did it, back when I was working for a restaurant company and became friendly with a woman who staffed one of our hostess stations. It felt strange and demeaning to go from chatting about our weekend plans one minute to pressing a couple of sweaty bills into her hand in exchange for my coat the next. But to abstain would be even worse &mdash it would mean neglecting my contribution to a pool of money that I knew comprised her income. I get the feeling she wasn't too keen on the power dynamics, either.

The friendships I've formed with restaurant employees over the years have made me think seriously about why hospitality workers are singled out among America's professionals to endure a pass-the-hat system of compensation. Why should a server's pay depend upon the generosity &mdash not to mention dubious arithmetic skills &mdash of people like me?

So I was thrilled to hear that New York City's Sushi Yasuda recently decided to eliminate tipping altogether. Including gratuity for parties of six or more has already become relatively commonplace in a few restaurants, like Thomas Keller's Per Se and The French Laundry, it's automatically added onto all checks. But Yasuda has gone one step further, dispensing with service as a separate line item &mdash and implicitly, an "extra" &mdash and folding it into their prices as a cost of doing business, along with the rent, and electricity, and ingredients.

If I had my way, we'd take this idea to its logical conclusion and get rid of the practice of tipping altogether. Just outlaw it. Here's why:

1. People don't even understand what a tip is.

If you are of the belief that a tip is an optional kindness you're doing for your server, you might be surprised to hear that you are not in France. Here in America, the practice is voluntary only in the legal sense of the word. You are not technically stealing if you don't tip the customary 15 to 20 percent, but that's probably the best that can be said of you. The tip you pay is a sort of wage: federal law allows tips to be used to make up the difference between a server's salary and minimum wage, meaning they can make as little as $2 to $3 per hour from their restaurant employer. Tips are absolutely depended upon to make up the shortfall.

When you leave a bad tip, you are docking a person's wages. This may either be because you're confused about what's expected or because you're an asshole, and you really believe that your sea bass arriving lukewarm is justly punishable by making it a little harder for the guy who brought it to you to pay his rent.

2. Doctors don't live on tips. Nor do flight attendants.

Tip confusion is understandable, because it's not the way we choose to compensate most of our other people-facing professions. Imagine if when you went to the doctor, you decided how much he got paid based on how happy you were with the diagnosis or if actors and musicians were paid discretionary sums by the audience, post-performance. Even within the context of the restaurant, some roles receive salaries and others rely on tips. Why do I tip the bartender who made my Manhattan, but not the line cook who grilled the excellent steak I'm eating with it? It's completely arbitrary. Servers, whose job demands are not fundamentally different than that of hard-working office assistants, or hotel concierges, or spin instructors, or flight attendants, should be paid the competitive wage for what they do and how well they do it, and that cost should be factored into menu prices.

3. The percentage basis makes no sense.

Did a server work less because I ordered a $40 bottle of wine than if I had ordered a $400 one? Should I feel a little bit bad when I'm a party of three on a table for four, as the waiter is getting stiffed on 25 percent of his or her optimal tip? Is it less hard to work at a roadside diner than Le Bernardin, where the check averages are approximately ten times higher? (Although that one isn't entirely fair a place like Le Bernardin is dividing the tip among a much larger staff).

4. Better service doesn't actually beget better tips.

Diners love the power to bestow or withhold financial reward at their whim servers, in turn, seem to be motivated by the idea that really excellent service could be rewarded by a monster gratuity. The trouble is, that's not actually how things pan out in practice. Michael Lynn, a professor at Cornell's School of Hotel Administration, has spent his career researching tipping behaviors, and found that perceived service quality only accounts for two percent of the variation between tips. Two percent! It's probably not even enough to be picked up on by the server, much less cause a significant change in behavior.

5. It perpetuates racism and sexism.

Lynn's research also shows that tip amounts are affected by racial and gender discrimination. Female servers get larger tips than male servers sexy women earn more than frumpy ones white servers, more money than their black counterparts &mdash regardless of what the perceived quality of service is. The system works the other way, too. Black diners tip less on average than do white diners, and research shows that servers provide black diners with inferior service as a result. The tipping system catches us all in a regressive cesspool of our own worst prejudices.

6. Smart people have been trying to end the tipping practice for a century.

Backlashes against the tipping practice are not new. There was an anti-tipping movement at the beginning of the 20th century amongst Americans who saw it as an aristocratic holdover contrary to the country's democratic ideals. Between 1909 and 1915 six states passed anti-tipping laws, all of which were repealed by the mid-1920's as unenforceable or potentially unconstitutional. Samuel Gompers, who founded the AFL, was one political figure notably outspoken against tipping as promoting detrimental class distinctions.

But despite all this, the country as a whole has been loath to abandon the tipping convention. If knowing all of the above, you still balk at the idea of a service charge being rolled into the cost of your meal, maybe you should ask yourself why this is. Are you unwilling to participate in what a restaurant judges to be the fair, market-rate compensation for its employees? Do you think that you are a pawn in a nefarious plot by management to grossly over-reward servers, those men and women who are on their feet for eight hours, ferrying your drinks and foods to and fro? Do you believe that you are in a better position than the restaurant manager to motivate and evaluate his or her staff and make the complicated decisions about compensation and employment?

If yes, can I march into your office and adjust your pay depending on how well you do in our meeting? Or &mdash more accurately &mdash depending on your skin color, your breast size, or your age? Well, of course not, is the answer to that one. Because that would be barbaric.


Do You Know Where Your Tip Money Is Going?

It’s a scene that plays out at the end of the night at most restaurants across the country: Servers, tired from a long shift and ready to clock out, must count the cash that’s in their pockets and match it with the sales and tips they earned that day. Once that’s reconciled, they file the money and receipts away, and, depending on the restaurant, might pass a few bucks from their take-home tips to the bartender, food runner, busser, or hostess. This is called “tipping out” in industry parlance, and it’s a fluid and frequent practice of sharing the (tip) wealth. Since 2011, servers have not been allowed to share tips with the cooks or dishwashers behind the kitchen doors. But the Trump administration made a drastic change to that rule earlier this year.

On March 23, the government passed a 2,232-page budget spending bill. Tucked inside, on page 2,205, were hard-won, far-reaching amendments to the Fair Labor Standards Act (FLSA) offering protections for tipped workers. The bill expressly prohibits employers, managers, or supervisors from collecting or retaining tips made by employees — one of the biggest concerns opponents had against the Department of Labor’s recent, and widely hated, proposal.

The new law makes another critical change. It allows tip sharing between tipped and non-tipped employees — for example, between servers and cooks — if a restaurant pays the full minimum wage (does not take a tip credit) to all employees. This is a departure from the older rules, which did not allow such sharing of tips between traditionally tip-earning staff (bartenders, servers) and non-tip-earning staff (cooks, dishwashers).

The change in the law means that restaurant operators in most states — including the seven states that do not have a tip credit (California, Oregon, Washington, Nevada, Minnesota, Montana and Alaska) — are now free to ask servers to tip out the back of the house provided they pay employees at least the full minimum wage for all hours worked. However, in a few states, such as New York and Massachusetts, due to the particularities of state law, it remains illegal to share tips with back of the house even if the restaurant pays the full minimum wage.

First, some good news.

At least in the short term, the change has the potential to level longstanding income inequality between back and front of the house. “This is just huge news for full-service dining,” restaurant owner Benjamin Shahvar told the San Francisco Chronicle. “This is as big as finding out the minimum wage is going up $1 a year for the next five years.”

A number of restaurants in California are already embracing the new rules. Rocco Biale, owner of Rocco’s Ristorante Pizzeria in Walnut Creek, a family-owned, full-service, 350-seat restaurant that’s been around for 19 years, began sharing tips with back of the house nearly immediately after the change in the FLSA.

“The kitchen is not only part of the chain of service, they are the heart of the chain of service,” Biale says. “There is a lot of back-of-house work that is critical to the diner’s experience and there is no logical reason why hard-working kitchen staff should not share in a portion of the customer’s generosity. To not allow them to participate in a tip pool has been a long overdue oversight.”

The change, at least at Rocco’s, has been seamless. The servers continue to tip out the same percentage, but the back of the house now shares in it, in addition to hostesses, bartenders, and barbacks, “chain-of-service employees” who were always in the pool. “We made the change right away and nobody blinked,” Biale says. “Servers don’t notice a difference because they tip out the same amount it’s just that now the back of house can share in it, too.” This means that everyone in the front gets a little bit less, too. The exact amount that everyone is tipped varies from restaurant to restaurant.

Tanya Holland, chef and owner at Brown Sugar Kitchen in Oakland, plans on sharing tips with the kitchen when she relocates to her new space in downtown Oakland and opens a second restaurant in the San Francisco’s Ferry Terminal Building. “I will absolutely be sharing tips with back of the house in my new restaurants,” she says. Holland has also signed onto RAISE, Restaurant Advancing Industry Standards in Employment, an organization of restaurants committed to professionalizing the industry and raising wages and work conditions. “Kitchen people are so underpaid and we have to equalize it,” she says. “The system is really antiquated and makes women very vulnerable to sexual harassment and coercion, and that has to stop. This change has been a long time coming.”

Biale says the key to harmony is to find the right balance in the tip pool, giving enough to the back of the house without making it punitive to the front. “You have to find that middle ground that satisfies the back and front of house,” he says. “Either a standard percentage of sales going to the kitchen workers, or a percentage of the tips earned by servers and bartenders going to the kitchen workers.”

Reducing income inequality isn’t the only projected benefit to tipping out the back Biale believes better compensation will also help to mitigate a huge labor shortage in the kitchen. “Restaurants need to better compensate the kitchen because there is a real labor shortage,” he says. “It’s so bad, we are in the fetal position here.”

On the other hand.

While most operators are pleased with the ability to share tips with the back of the house, this isn’t necessarily good news. Giving restaurateurs the power to force tip sharing with back-of-house staff could offset what should be the cost of doing business. Rather than give cooks raises, they can siphon tips off from servers to pad cooks’ existing salaries. It’s a quick fix for an urgent income-equality problem in the hospitality industry. But, over time, it removes some of the pressure to eliminate tipping — a practice Eater has found demeaning and discriminatory — altogether.

Perhaps unsurprisingly, not all servers are keen on the new rules. A server in New York City, who wished to remain anonymous, believes “it’s the restaurant’s job to take care of the back of the house and not the responsibility of the server.” She previously worked at a restaurant in Hawai‘i where tips were not shared with back of the house, but management paid the kitchen staff a higher wage and gave them other benefits, like separate family meal and food to take home. “That worked out really well and we had a nice sense of camaraderie,” she says.

Two servers in San Francisco, who didn’t want their names printed, admitted that it sounded “selfish” to not want to share tips with back-of-house staff. They were accustomed to tipping out their fellow service staff, and noted that except in the case of gratuity-included restaurants — a system pioneered by restaurateur Danny Meyer’s Union Square Hospitality Group — sharing tips with non-tipped workers “seems like giving our money to the owners. It’s like, all of a sudden Chef doesn’t need to give the cooks raises, because we did.”

The current situation:

The issue is bubbling up in New York City with some force. While it remains illegal to tip out the back of the house in New York for now, the change in the FLSA might usher in a new paradigm for the way the city pays its restaurant workers.

The state of New York is now considering eliminating the tip credit, which could then open the door to a change in rules regarding sharing tips with back-of-house workers. Gov. Andrew Cuomo is currently holding hearings on whether to eliminate the tip credit, a proposal that has stirred up virulent opposition, with many restaurateurs contending that this could be the death knell for the industry. “After New York raised its tipped minimum wage by 50 percent at the end of 2015, over 270 restaurants closed statewide,” wrote Michael Saltsman, managing director at the Employment Policies Institute (EPI). “Unless Cuomo wants New York City to go the way of San Francisco — where dining out becomes a privilege for the well-heeled, and high costs crush the mom-and-pop eateries — he’ll send this half-cooked proposal back to the kitchen.”

Beatrice Stein, a restaurant consultant in New York City, says the tip credit is critical to New York restaurant operators. “That tip credit greatly helps a restaurateur to save money in a climate where they are facing insurmountable costs — taxes, and fees for family leave and sick pay and skyrocketing rent and food costs,” she says. “The operating costs are just too high, and if we lose this we will have to put less people on the floor to reduce labor costs. That puts stress on everyone in the restaurant and really affects the guest and the guest experience.”

To offset costs, more than 200 restaurants — from Michelin-starred restaurants like Eleven Madison Park and Cafe Boulud to popular neighborhood ones like Jack’s Wife Freda and St. Anselm — have signed a letter to Mayor Bill de Blasio asking that he support their right to add a surcharge. Currently, it’s illegal in restaurants for New York to add a surcharge to bills, a law intended to protect diners from surprising fees.

Andrew Rigie, executive director of the New York City Hospitality Alliance, opposes the removal of the tip credit. “We can’t look at this in isolation,” he says. “By the end of this year there will have been nine mandated wage increases in the past three years. Coupled with the sky-high price of commercial real estate and the new mandated paid sick leave and health care, you have a perfect storm of price pressures.”

Without citing sources, Rigie believes restaurant workers are also opposed to losing the tip credit. “Servers are doing really well under the current system, and they are concerned that if the tip credit is eliminated, it will hurt their earnings,” he says, pointing out that if their base salary increases, menu prices will need to rise, eventually resulting in fewer diners spending less money when they go out. Rigie also believes that eliminating the tip credit would further increase the disparity in wages between front-of-house and back-of-house workers, who cannot earn tips.

Evidence is conflicted on the true benefits to eliminating the tip credit. Restaurant Opportunities Center United (ROC) research shows that paying full minimum wage does not reduce servers’ tips, and does not reduce overall restaurant sales. However, The Census Bureau released a study that found a decrease in tips associated with a higher minimum wage.

That said, a recent poll by the National Restaurant Association found that a majority of Americans believe the minimum wage should be raised, even if it means they’ll have to pay more for their meals when dining out. Results of the poll, which were presented on a slide deck obtained by The Intercept, indicated that 71 percent of Americans support raising the federal minimum wage to at least $10, “even if it also increases the cost of food and service to customers.”

The change in the law may also reduce sexual harassment in the industry. “When front-of-house and back-of-house workers share in the tip pool, there is less tolerance for sexual harassment,” says Saru Jayaraman, executive director of ROC, who points out that the seven states paying the full minimum wage (and not a tip minimum) have half the rate of sexual harassment compared with the other 43 states which have tipped minimums, according to ROC’s 2014 Glass Floor Study.

Sexual harassment proliferates when some workers experience a lack of power when female servers earn sub-minimum wage, they have to do whatever it takes to earn tips, and that includes tolerating harassment by kitchen staff. “When you bring back of house into that tip pool, the power and balance shifts, because the waitress gets a full wage and the kitchen is invested because they can share in that tip pool,” says Jayaraman. “Everyone along the line of service becomes a team and that changes the power dynamic.”

A recent report supports ROC’s research. In interviews conducted by the New York Times, more than 60 servers and bartenders shared stories of crude comments, propositions, groping, and even stalking from customers. “They work in diners, chain restaurants and high-end dining establishments, and they reported hourly take home pay ranging from $8 to more than $40,” the Times reported, linking sexual harassment to tipping. “Working for tips means that each shift comes with questions that do not apply to millions of other workers around the country: How much money will I make, and how much will I tolerate to make it?”

But the EPI conducted a review of ROC’s methodology and Equal Employment Opportunity Commission data collected during the time period studied by ROC, and found discrepancies. They concluded that there was almost no difference in the percentage of sexual harassment reported from restaurants in the states without the tip credit and those with. They also found that New York State, which does have a tip credit, has a lower rate of restaurant sexual harassment than any of the states without a tip credit. That said, it’s widely known that incidents of sexual harassment are under reported as victims fear retaliation.

Regardless, some New York operators are already convinced of the benefits of tip-sharing. Sara Jenkins, the chef and owner of Porsena restaurant in the East Village, told Eater in December that she would love to see New York adopt regulations permitting operators to tip out the back of the house. “I don’t think it’s fair that waiters take home such significantly huge salaries that the kitchen does not,” she says. “If I could share tips between front and back of house, even if I had to pay full minimum wage, I would do it.”

Camilla Marcus, owner of West-Bourne in Soho, a hospitality-included restaurant that employs its staff from the Door, a nonprofit that serves at-risk youth, agrees. “The back of house has been marginalized for a very long time, and I think the change in the law shows we are moving forward,” she says. “A model that brings teams together is important.”

Update 6/13/18 9:48 a.m.: This post has been updated to reflect inconsistencies in data about the connection between tips and incidents of sexual harassment.

Andrea Strong, founder of the pioneering food blog the Strong Buzz, has been writing about restaurants and food for the past 18 years.
Editor:Daniela Galarza


Chipotle Is Involved in New Legal Drama in New York

Chipotle is being sued by the city of New York for hundreds of thousands of alleged violations of its Fair Workweek Law, which aims to protect workers from unreliable work scheduling practices. According to the lawsuit, workers are owed more than $150 million in compensation from the fast-casual Mexican chain.

Chipotle allegedly violated workers' rights at several dozen restaurants across the city by changing work schedules at the last minute and requiring workers to cover back-to-back shifts, according to the complaint. In these instances, workers were allegedly not offered additional compensation or adequate notice or time off. The chain also purportedly did not offer its existing workers more shifts before hiring new ones to fill them, a practice which left its employees "in an involuntary part-time limbo."

Furthermore, the chain allegedly violated the Paid Safe and Sick Leave law, which mandates that employees receive a minimum of 40 hours of paid sick leave per year. Between April 2014 and January 2020, the chain only allowed for 24 hours of paid sick time, the lawsuit claims.

"Chipotle's flagrant disregard for our laws and for their employees is unacceptable," New York City Mayor Bill de Blasio in a statement to The New York Times. "Workers deserve reliable schedules, and we will do everything in our power to hold them accountable."

Chipotle was previously sued by the city of New York for similar violations of the same law that allegedly took place between 2017 and September 2019, according to the outlet. In total, the company has about 90 locations that employ about 6,500 workers in the city.

Chipotle said it does not comment on pending litigation in a brief statement provided to Eat This, Not That!.

"The proceeding filed today by DCWP is a dramatic overreach, and Chipotle will vigorously defend itself," Laurie Schalow, chief corporate affairs officer, said in the statement. "Chipotle remains committed to its employees and their right to a fair, just, and humane work environment that provides opportunities to all."

For more, check out America's Largest Fast-Food Chain Is on a Downward Spiral, Reports Say. And don't forget to sign up for our newsletter to get all of the latest restaurant news delivered straight to your inbox.


New York City Doubles Down on Labor Lawsuit Against Chipotle

After suing Chipotle for labor violations two years ago, New York City alleges the chain still hasn't fixed the issue.

New York City doesn&apost appear to be too pleased with Chipotle Mexican Grill. Back in 2019, the city sued the popular burrito chain for violating its Fair Workweek Law—passed in 2017—which protects fast food workers&apos "right to a predictable work schedule." Now, two years later, not only has that lawsuit not been resolved, but the city is replacing it with a bigger suit—referred to by the New York Times as "the largest action the city has brought under the law"𠅊nd it could cost Chipotle hundreds of millions of dollars.

This latest legal action, filed this week, alleges that Chipotle owes workers across New York City&aposs roughly 90 locations $151 million in relief for violating a number of the Fair Workweek Law&aposs provisions. And from there, additional financial penalties could reportedly more than double the total amount Chipotle is required to pay.

According to CNN, NYC&aposs Department of Consumer and Worker Protection claims to have uncovered upwards of 600,000 violations across New York City&aposs 6,500 Chipotle employees from November 2017 until at least September 2019. The allegations include not giving workers a required two-weeks advanced notice of their schedules, having employees work multiple shifts without sufficient time off, failing to provide the additional pay required in these kinds of situations, and failing to offer existing employees additional shifts before hiring new employees𠅊 move that left "thousands of employees in an involuntary part-time limbo."

Adding to Chipotle&aposs troubles, the lawsuit claims that "although Chipotle made some efforts to come into compliance beginning in September 2019, it remains out of compliance in significant ways." So even after the initial suit, New York City seems to believe the burrito chain didn&apost take the actions required to address the situation.

"Since we first filed our case against Chipotle, we have unfortunately learned that those initial charges were just the tip of the iceberg," Lorelei Salas, commissioner of the NYC Department of Consumer Affairs, explained in a statement provided to CNN. "This case exemplifies the abusive practices that this law is intended to end."

​Mayor Bill de Blasio added, "Chipotle&aposs flagrant disregard for our laws and for their employees is unacceptable. Workers deserve reliable schedules and we will do everything in our power to hold them accountable."

In Chipotle&aposs defense, the company&aposs chief corporate affairs officer, Laurie Schalow, told CNN, "We make it a practice to not comment on litigation and will not do so in this case, except to say the proceeding filed today by DCWP is a dramatic overreach." She then added, "Chipotle will vigorously defend itself."

Meanwhile, these multiple run-ins with the City of New York aren&apost Chipotle&aposs only government tussles over labor laws. Last year, the chain reached a $2 million settlement with the state of Massachusetts over labor violations that included overworking 16- and 17-year-old employees.


5 New York City Bars and Restaurants That Changed History

Anyone who has ever had a favorite eatery shut down knows how intrinsically these establishments can be linked to our own history: be it your favorite bar in college, the place where you got engaged, or your go-to comfort spot establishment. In a broader context than our own lives, some locales have been tied to major movements that have had impacts far beyond their immediate neighborhoods, too.

“When you look at New York City, restaurants and bars are more than just places to drink, they’re really anchors of our community, and they take on social and historical significance,” said Andrew Rigie, executive director of the NYC Hospitality Alliance.

Here are five still-operating New York City establishments that you’ll want to get to know.

The 21 Club

21, which has evolved into a bar room, a restaurant, and private event space since opening in 1930, is one of the most iconic restaurants in New York and a favored haunt of many Hollywood celebrities. Its roots stretch back to the Prohibition era, when it became a popular speakeasy (and a secret wine cellar with a revolving bar that kept booze out of the authority’s view). Though famous folks like Frank Sinatra, George Steinbrenner, and Joan Rivers frequented the restaurant for its classic American fare, like its famed chicken hash or 21 burger, the establishment has also had an undeniable impact on how we drink.

“When you look at this country during Prohibition time, the 21 Club was a significant restaurant and speakeasy that people went to, and post-Prohibition it’s had celebrities and business people going to the restaurant to kind of capture a piece of history,” said Rigie, adding that people who have worked there have spawned interest in the cocktail movement that has swept the nation in recent years. “Almost every restaurant you go into has a craft cocktail menu, and even chain restaurants [do now, too],” he said. “People care about the quality of the product and that’s true for cuisine and cocktails. It’s an art, and what [people have been] able to do with some of these cocktails, many of them are Prohibition-era cocktails, so you’re bringing back drinks that were consumed many years ago.” Have a mixologist at your favorite hometown bar? You can thank 21 Club for keeping the tradition of cocktails alive through the years.

McSorley’s Old Ale House

How many bars do you know that have been involved in precedent-setting court cases? Well, McSorley’s, the oldest continually operating bar in New York, is one of them. “It has survived over a century [and] a half in a city where most pubs are lucky if they last a decade, which I think is the biggest continued draw of the bar,” said Maeve McNamara, former bartender and daughter of current owner Mathew Maher. “New York changes so quickly, and so I think people are drawn to something that has been open for so long and hasn't changed very much. Continuity of that degree is really uncommon, and I think that is what makes us special and so dear to our customers' hearts.” McSorley’s hasn’t just been a watering hole for celebrities (though of course, there’s that, too, with everyone from Abraham Lincoln to Justin Bieber stopping by), but it has also been the subject of various creative works over the years, including poetry by E.E. Cummings, paintings by John Sloan, in addition to books and plays.

But back to that court case. Many people know the bar, McNamara said, because up until August 1970 it was a men-only establishment. Women were eventually allowed in after the National Organization of Women sued claiming that the discrimination was a violation of constitutional rights, and won. The bar now welcomes all patrons (a mix of college students, tourists, and colorful regulars) that come in to toast with either house light and dark ale (no hard liquor here) and eat hearty pub fare like corned beef hash or a cheese platter (consisting of New York cheddar, raw onions, and saltine crackers) at communal tables. Paul Freedman, author of “Ten Restaurants That Changed America,” said one major category of restaurants that have a historical impact are simply those known as survivors. McSorley’s among them. “It’s so unchanged that is has become everyone’s idea of what a pub should be,” he said.

Fraunces Tavern

There are plenty of restaurants throughout the country that have hosted modern day presidents, but few that have done so for the first. Fraunces Tavern is one of them. “Not only was it a favorite watering hole for founding fathers like Alexander Hamilton, John Adams, and George Washington, but most notably, it is where George Washington bade farewell to his officers on Dec. 4, 1783 following the end of the American Revolution,” said Jessica B. Phillips, executive director of the Fraunces Tavern Museum. Fraunces, which still serves drinks and food, now also provides the community with an opportunity to explore the American Revolutionary era at its adjacent museum.

Since its Revolutionary War days, Fraunces has expanded, with its museum and tavern occupying five separate buildings on Fraunces Tavern block, a historic district on the National Register of Historic Places, with each room’s decor keeping with the style of the building, said Amy King, marketing coordinator for the restaurant. Meanwhile, the Porterhouse Bar at Fraunces Tavern boasts an impressive collection of craft beers, Fraunces’ whiskey bar has a specialty collection of over 260 world whiskeys, and its hideout bar serves as a sports bar. “While we still have some very traditional tavern menu items, our menus have changed over the years to suit modern tastes and trends while still staying true to the tavern's roots,” King said. Guests from near and far can nosh on the restaurant’s slow-roasted chicken pot pie, traditional fish and chips, or filet mignon on a stone at the place where George Washington once hung his hat.

Julius’

It might not sound like ordering a drink would create history, but that’s exactly what happened at Julius’ in 1966. Before the famed riots at the Stonewall Inn, which kicked off the gay rights movement, the gay rights group Mattachine Society organized a “Sip-In” at Julius’ to challenge an unwritten rule that allowed bars to refuse service to LGBT patrons, said Ken Lustbader, co-director, NYC LGBT Historic Sites Project. “The bar has been around the mid 19th century. Not only is it historical in that it’s been serving food for so long and that the interior is intact from what we believe is right after Prohibition, but it’s the site of an important LGBT sort of civil disobedience over 50 years ago,” Lustbader said. “The Sip-In was one of the earliest public displays of LGBT civil unrest. At the time if you were LGBT and went into a bar and said you were a homosexual you could be refused service because LGBT people were considered disorderly.” The Mattachine Society went into Julius’, ordered drinks after saying they were gay with the press in tow to shed light on the unfair practice. This “helped pave the way” for diminishing harassment for LGBT individuals at bars and restaurants, Lustbader said.

Since then, Julius’ has undergone a gradual transformation, going from a sports bar in the 1940s and 1950s, to a gay bar in the late 1960s, 1970s, and 1980s, Lustbader said. Now, it’s the longest continually operating gay bar in New York City and is a gathering place for a large swath of people—diverse in ages and attracting local people and visitors. “People really recognize it as a safe place and has a wonderful patina of history that recognizes its LGBT past but is also very current,” Lustbader said.

Delmonico’s Restaurant

If you enjoy fine dining, you can thank Delmonico’s for creating the concept. The eatery, which opened its doors in 1837, was largely thought to be the finest restaurant in the United States in its early days, said Freedman, and was known for revolutionizing New York’s financial district and making it a destination for gourmands. “It defined fine dining more than any other restaurant” Freedman said, adding that it prioritized service in addition to quality in a way that has set the bar for other fine dining establishments, and is responsible for being the first to serve up some American staples like Baked Alaska and Lobster Newburg (classics that are still on the menu today).


NY's Business Curfew Hurts Restaurants Trying to Host Super Bowl Events, Owners Say

By Checkey Beckford and Erica Byfield &bull Published February 6, 2021 &bull Updated on February 6, 2021 at 3:47 am

New York restaurant owners had been hoping for some sort of Hail Mary from Gov. Andrew Cuomo that would allow them to stay open past 10 p.m. for Super Bowl Sunday, saying the one-day-only extension could be used as a sort of pilot program.

That's the sort of language Cuomo used to describe allowing the Buffalo Bills to have fans at their home playoff game last month. And with improved recent COVID numbers, some thought there might be a chance.

However, those hopes were sacked by the governor Friday.

"No, we are not thinking about changing the curfew for Super Bowl Sunday," Cuomo said, joking that "maybe if the Bills were in the Super Bowl it would be a different conversation."

But business owners aren't laughing, saying that the governor's curfew is hurting their chances of making any money on the unofficial holiday. The game is set to kick off at 6:30 p.m., but it will still be going well past the state-imposed shut down time.

"Super Bowl Sunday is one of our busiest days and nights of the year," said Aristotle Hatzigeorgiou, who owns Clinton Hall in Lower Manhattan. "It's very hard to tell people to come join your establishment on a Sunday, then have them go home at 10 o'clock, which is about halftime."

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Adding some salt to the wound, nearly 100 upstate New York bars and restaurants were granted an exemption from the curfew after they sued the state — but it only applies to those businesses.

"Make it fair so statewide everybody operates under the same rules and, two, it's probably going to start a whole rash of new lawsuits from all the other establishments that can't open," said Hatzigeorgiou.

The governor's office didn't comment on the judge's decision to give the exemption, only saying that they were "reviewing the order."

The owners' opening concerns were addressed across the river in New Jersey, where Gov. Phil Murphy lifted the state's curfew, allowing restaurants to stay open later. For the first time in nearly a year, restaurants on Friday were able to stay open past 10 p.m.

Concurrently, the new measures allow 35 percent capacity for indoor dining, as opposed to the previous 25 percent. Some restaurants said that increase won't make much of a difference, perhaps adding a table or two, but it is a step in the right direction.