Chef and owner Brian Clevenger is celebrating the opening of Contadino and its sibling pizzeria on 19th Ave E. While he would prefer to talk about fresh pasta and pizza, he, like a growing number of Capitol Hill food and drink owners, is answering questions about an italicized note at the bottom of his menus notifying diners of a “5% service charge” that is “distributed in full to the employees you do not see” —
While pro-labor advocates call the new crop of service charges added by owners like Clevenger protests of “the fact that they have to pay their workers a living wage,” the Contadino restaurateur says he is trying to find a new path to solve an issue close to his heart. And he might soon find some help from the last guy you might expect to lend a hand to a restaurant atop Capitol Hill, Seattle.
“When I started, that was the part that made it worth it,” Clevenger told CHS Tuesday morning about the tips shared in an organic, poorly regulated, process that had been playing out in American restaurants for decades.
In 2016, a Ninth Circuit Court decision upheld a U.S. Department of Labor rule barring restaurants from requiring employees to share tips with back of the house workers. Ever since, owners like Clevenger have been trying to sort out how best to turn the dials to keep his front of house staff satisfied while making sure his cooks and dishwashers get a fair cut. Raise prices a little and the tips only go up for front of house. Raise prices more, tips go up for front of house, and you can now pay back of the house higher wages but you risk a drop in business. How much will your neighbors pay for pizza? Clevenger said it is in that environment that he decided to experiment and move his businesses forward with a service charge at Contadino.
“We’re trying to shorten the pay gap between the cooks and the servers.”
At Vendemmia in the Madrona neighborhood, Clevenger said his staff is still pooling tips and that he could roll back to the old way at Contadino. It’s a risk. With the labor ruling in place, Seattle owners are being advised by industry associations that they could face federal investigation and lawsuits. Other restaurants have experimented with adding a separate tip line for the kitchen while more on Capitol Hill are eliminating tipping altogether.
Meanwhile, Seattle’s march to a universal $15/hour minimum wage also complicates the situation around pooling. Workers at small Seattle businesses — those with 500 or fewer employees — are now guaranteed $13 per hour, up $1 from 2016. Employers either hit that by paying $13 per hour or by paying $11 hourly and either at least $2 per hour toward medical benefits — or ensuring their employees get at least $2 hourly in tips. Seattle’s tip credit toward the $15 wage is scheduled to run through 2025. Without a service charge, a restaurant owner must cut into already slim margins to meet the minimum wage for non-tipped employees in the kitchen.
Clevenger might get some help sorting out the matter from some unlikely places. To start 2017, a petition is pending before the Supreme Court to take up the issue. “The Trump administration is likely to oppose the rule,” industry analysts say, “as being anti-business, because it is seen as economically advantageous for restaurant employers to have back-of-house employees participate in tip pools.”
Clevenger said, whatever the ultimate decision on tip pooling, his service charge is not a protest. It is, like the other policies and practices he has put in place as a small business owner, a solution to make Contadino survive, grow, and be a great place, he hopes, to work.
“Minimum wage is not an issue with us,” Clevenger said. “We don’t want overpriced food. We’re a really small company just trying to survive in a challenging market.”