The Daily Rail: The Tip Pooling Controversy

Tuesday, January 24, 2017


Today's Specials:


GALLERY: Can You Spot the Rat in These Restaurants?

Cleanliness is key and these restaurants have some serious work to do! We’ve collected a gallery of seven restaurants that have a major rat problem. Can you spot the rat in each restaurant?


BUSINESS: Increase Your Intelligence in One Day

Are you listening to your customers? And we don't mean online reviews or compliment cards. We mean listening to their silent feedback -- data intelligence.




Beer Recall!

Sierra Nevada Brewing has recalled some of its bottled beer in the Midwest, South and East Coast for some of its beer. A flaw in the bottle was detected that could allow glass to break and fall inside. Ouch!


Millennials are Killing the Big Mac

Only 20% of Millennials have ever tried a Big Mac, according to Bloomberg. To answer the problem, McDonald’s is introducing two new members to the Big Mac family – Mac Jr. and Grand Mac.


Why are Cows Being Fed Skittles?

Not a joke. Cows in Wisconsin are being fed Skittles because they serve as “cheap carbs” – even cheaper than corn. This isn’t a new trend, however. CNN says bovine’s have been living off sugary sweets “for decades” but the practice was grown since corn prices have increased.



Why it matters to you: We can’t say it enough, knowing your customers mean better customer service.

Parents of children with autism and sensory sensitivities have a hard time eating out. One interesting partnership is working to change that. Mary’s Pizza Shack in Napa, CA is working with a local nonprofit called Anova to offer “Sensory Friendly Kits” in some of their locations.

The kits include ear muffs to reduce noise and toys that help relieve stress or help children focus and manage their anxiety in an unfamiliar environment.

Pizza places are well recognized as family friendly establishments. This pilot solution could actually make restaurants more inclusive and accommodating of different needs. From a purely business perspective, this tactic opens up their establishment to cater to specific needs and grow their business. This solution is a great example of a win-win for parents and restaurants alike.



Why it matters to you: are you aware of the controversy over tip pooling?

The tipping process in restaurants has been in the spotlight for some time now. Just recently the National Restaurant Association has petitioned the Supreme Court to hear a case to overturn the existing Labor Department regulation—and allow tips to be pooled with back-of-the-house employees. Right now, the law states that tips are the property of the employees who receive them, NOT the restaurant; therefore the restaurant cannot influence where tips are given after collected.

The idea behind the tip-pooling rule is that waiters, bussers, and bartenders are allowed earn less than minimum wage because their tips are credited to their salary. Cooks and dishwashers, in turn, must earn a minimum wage. National Restaurant Association claims the rule that bans tip pooling is a form of “overregulation of business by government,” saying restaurants should have the freedom to control compensation of their employees. Overall, working in restaurants may become very different in months to come.



Why it matters to you: If you follow Danny Meyer you’re bound to get things right

Seems like a week doesn’t pass that Danny Meyer and the folks at Shake Shack aren’t making some industry leading news. This time it’s their approach to mobile ordering that is newsworthy. The fast moving chain announced that they are giving away one of their signature single Shakeburgers if you download their new ShackApp. As far as growing your app base, this offer is a perfectly targeted approach. Shake Shack is simultaneously introducing their online ordering portal, encouraging downloads and then rewarding the guest with free product for completing their first transaction.

As marketing strategies go, this is as sound as it gets. The object is to both acquire contact with the guest, but also induce them to visit or redeem an offer. As an example, let’s say you want to build your email marketing list. Inform guests that if they join your list they will receive a special offer in their first email. A free appetizer, a special dessert or complimentary beverage with their next visit, are all solid inducements. Now, not only do you have their email address, but you have them anticipating an email from you. So, while you may not be able to wow them with your new mobile app you can still use behavior based marketing to engage your guests and strengthen your relationship with them.