Saru Jayaraman, co-founder and co-director of the Restaurant Opportunities Centers United (ROC United), says that the winds of change are blowing across the restaurant industry with restaurant leaders parting with traditional ways of doing business.
In fact, she says that in her 15 years in the industry she's "never seen such a rift in the industry" as we're seeing right now. That rift is coming is mostly coming in the form of compensation, with some restaurants banning tipping while others are holding onto the ways that have always worked for them in the past.
In a recent interview with the Boston Globe to promote her new book, Jayaraman talked about how there are two types of restaurants -- "high road" and "low road." For Jayaraman, "high-road" restaurants are those that pay their staff well and gives them fair benefits like paid sick leave (which isn't just a matter of improved worker conditions but also a health issue for customers).
The third key item for a "high-road" restaurant, according to Jayaraman, is career growth in the industry.
“The third is really mobility, particularly for workers of color, immigrants, and women. When you have the opportunity to move up the ladder, perfect your skills, and see that your hard work and merit pay off, then you feel like you’re in a profession.”
Despite's tipping's murky past in America's history, Jayaraman isn't against tipping. She just wants to eliminate the lower wage for tipped workers.
“I actually think it’s all about policy that moves entire cities and states to the high road. That’s how you will achieve scale. We just passed $15 [minimum wage] in California — that’s for all workers. San Francisco is a high-road city. Every restaurant in the city not only has to pay $15 an hour, but has to provide health insurance and paid sick days. It’s pretty extraordinary.”
She said that 70% of tipped workers who live off $2-$3/hr are women who mostly work at larger chain restaurants. The same demographic that has three times the poverty rate of the rest of the restaurant workforce, according to Jayaraman.
“We’re doubly subsidizing these chains. We pay their workers’ wages through our tips and we pay for their workers’ survival through taxpayer-funded public assistance. You’re talking a total of $16.5 billion annually for the restaurant industry alone.”
Regardless if you share Jayaraman's opinions or not on tipping and the industry, it's clear that things in our industry are changing and are more in flux than they have been in years past. And more diners are sharing Jayaraman's views, which is only going to make the tide pull stronger.
How this all shakes out remains to be seen, but operators need to be forward thinking. If they're caught flatfooted they could struggle as badly as the newspaper and publishing industry has with their own status-quo upheaval.
For the entire Q&A with Jayaraman, head on over to the Boston Globe.