Kentucky Restaurant Utilizes Interesting Alternative to Tipping

In Depth

There’s a Kentucky restaurant that has completely abolished tipping, and contrary to what you might expect, it actually looks like it might be great for their servers.

Since Packhouse Meats restaurant in Newport, Kentucky opened in January, it’s had signs posting everywhere making clear that tips are not part of the transaction process. The credit card slips don’t even leave a line for tips. You might think this would screw servers over…except Packhouse’s owner, Bob Conway, actually did it in order to protect servers:

“I’ve heard the horror stories – $3 left on a $100 tab,” he said. “How much a server makes has nothing to do with how hard they work. Servers had quit because they couldn’t make ends meet.”

I feel that so goddamn hard. Every server who’s done the job for any extended period of time has at least one story like that — I had a family run my ass ragged for two hours at Applebee’s and leave $5 on a $125 for no discernible reason other than simple fuckery.

The trick to what Conway is doing, however, is that it isn’t a simple hourly: servers get paid either $10/hour OR 20% of their food sales, whichever is higher. Unsurprisingly to anyone who’s ever worked as a server, Conway reports that it’s almost always the over for servers.

The reality becomes apparent as soon as you do the math: to make $100, all you need to do in food sales is $500. Even at a chain restaurant, you can usually sleepwalk to $500 in food sales on a dinner shift. At a couple places where I worked, clearing $1000 in food sales wasn’t exactly rare for a busy night — and I would’ve been overjoyed to know I was guaranteed $200 for that sort of shift (when, far more frequently, crappy tips would’ve made it significantly less). If, for whatever reason, the restaurant is dead that night/day, you’re still guaranteed $50-60, assuming we’re talking about 5-6 hour shifts (the most common for non-closing servers, in my experience). My guess is that servers hit the $10/hour way more frequently on the day shift, as the food if often cheaper and there tend to be fewer customers at most restaurants during lunch.

This still wouldn’t work for fine dining (or even fine-adjacent dining, which is what I’d consider my time at McCormick & Schmick’s) — on my worst dinner shift at McCormick’s, I’d still pull roughly $12-15/hour (on a really good shift, such as Christmas Day, I could pull upwards of $35/hour), and alcohol (particularly wine by the bottle) tended to be a huge percentage of my sales. It’s also absolutely and totally untenable for a bartender unless you’re switching it to include alcohol sales; even then, you’d probably have to make it 30% of sales for the math to work out.* But it could work really, really well at a chain restaurant, which is where, let’s be honest, you’re likely to get screwed the hardest as a server. Conway reports that his servers make an average of $15/hour under this system. I would’ve danced naked on a heavily visible rooftop singing I’m a Little Teapot when I was working at Applebee’s if it meant I’d average $15/hour. Unsurprisingly, Packhouse’s employees report pretty high levels of job satisfaction.

The funny thing is, the process ultimately works out the same for the customer: restaurants slightly raise the food cost in order to cover increased labor, so a meatball that would be $2.40 is now $3.00. It actually winds up adding up to the same amount a customer would pay if they were tipping appropriately — meaning servers make what they should, the restaurant does just fine, and good customers see no difference in price. The only people inconvenienced are the dickhats who’d otherwise leave shitty tips — and screw them anyway, since almost every terrible tipper is going to tip horribly no matter how good or bad the service was.

Though there’s not currently any collective movement in place to shift to a system like this (and, again, it wouldn’t work for every restaurant unless the numbers were heavily tweaked), it’s interesting to see a restaurant taking the first step, and heartening to see them avoid screwing over their employees in the process.

*Bartenders typically make at least 150% of what servers make, and with good reason — they bust their asses to a mind-blowing degree. I was a pretty-good-but-not-great server, and I would’ve made a HORRIBLE bartender. Any server who doesn’t respect good bartenders deserves to make nothing and have all their service bar drinks spilled on their shoes.

Image via Sean Locke Photography/Shutterstock.

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