On Living Wages
Our staff is our family, and we are committed to providing the best possible work environment and exemplary work practices for our employees.
Daily, we work to nurture an inclusive workplace where all staff feel included, respected, and valued. We employ a leadership team of which more than 50 percent are women and people of color. We offer competitive wages as well as a meaningful benefits package, and over the last decade, we have lead the industry in evolving our business practices to address some of the intrinsic injustices in the tipped model of the hospitality industry. Read on about how living wages and pay equity have helped us push the needle in the right direction.
As a first step in addressing inequities, in 2016, we instituted a Revenue Sharing model across our restaurants, sharing a percentage of food sales with our kitchen staff, raising their pay by approximately $2 an hour.
Then in October 2020, we committed to take a stand with One Fair Wage and the High Road Restaurants organizations. With these commitments we pledged to work towards a legislative package that includes:
- Work towards a $15 minimum wage for all workers
- Fight to do away with the Sub-minimum wage for tipped workers
- Fight for legislation that allows restaurant owners to distribute tips equitably between the Front and Back of the House
Additionally, we subscribe to the stated mission of RAISE: High Road Restaurants, ”[to] advocate for fair wages and increased racial and gender equity through hiring, training, and promotional practices.”
Now in early 2021, we have taken the next step; this time targeting pay equity. Enacting an Administrative Fee allowed us to distribute these funds across the restaurant’s employees (excluding ownership), decreasing the wage gap that had been so prevalent between tipped and non-tipped positions.
We have installed these policies amongst our restaurant group, positively impacting the take-home pay, especially for our non-tipped staff. As we expand our model of service, we are continuing to reevaluate the distribution of tips, Administrative Fee and base wages to hold to our goals of pay equity and living wages. Still, we believe the passage of legislation targeting pay equity and living wages in the hospitality industry will create a level playing field, eliminating the advantage to those who would choose to maintain and leverage low wages to keep menu prices down.
On Pay Equity
WE ARE ARE EXPERIMENTING WITH A NEW PAY STRUCTURE AT STATE PARK, VINCENT’S AND MAMALEH’S DELICATESSEN. THE PURPOSE OF THIS CHANGE IS TO WORK TOWARDS MORE EQUITABLE PAY BETWEEN THE FRONT (FOH) AND BACK (BOH) OF THE HOUSE STAFF.
In order to provide equitable wages for all of our staff members, we’ve made the decision to include a 10% Administrative Fee on all takeout checks, and 20% on all table-service checks. Additionally, guests may choose to tip.
These two amounts will be combined and redistributed to employees in their paychecks. This change will include FOH and BOH Management but exclude ownership. We conservatively project employees will get an additional $3 – $5 dollars per hour over their base pay in their paycheck.
We are putting an end to our Revenue Share program but in this shift, we are guaranteeing all employees in the company will make a minimum of $17/hour.
Our original intent was to fully remove the ability for guests to tip. At this time, we aren’t able to do this because of limitations in our point-of-sale system, called Toast. Since we offer delivery through our ordering sites that is serviced by a third party delivery partner, we need to allow tips for drivers who are not our employees. We can’t remove the option to tip our staff and keep on the option to tip the delivery driver – it’s all or nothing. We have also received feedback from some guests who would like the option to leave a tip even with the Administrative Fee on their check. Due to these reasons, we’ve decided to leave the tip line on all checks, (online and paper). Tipping our staff is no longer necessary, but always appreciated if a guest cares to.
Beyond pay equity, we also feel moved to make these changes to provide stability and dependable wages to our tipped employees. These front of house positions have historically been shorter shifts during the busiest times, with hours being cut when business is slow. We have decided to forgo the sub-minimum wage and start all employees at a minimum of $13.50/hour. This is a noticeable expense to the business — the sub-minimum wage has allowed restaurants ‘cheap’ labor, and while the system works for a business’ bottom line, we feel it is time to move beyond that crutch. In our model, front of house workers can know that their time and efforts are valued, and can rely on steady wages that are not subject to weather or the level of business on a given day.
WE ARE LOOKING FORWARD TO CLOSING THE WAGE GAP BETWEEN THE FRONT AND BACK OF THE HOUSE, AND DOING OUR PART TO GET OUR EMPLOYEES WORKING FOR A LIVING WAGE.
The purpose is to make pay equitable between FOH and BOH and make a living wage for all.
Why not just share tips?
Massachusetts is one of two states in the nation that does not allow tips to be shared between the Front and Back of the house. We are working closely with elected officials to make this change in regulation. But, until then, we are forced to work around the issue with this pay structure.
Why are you doing this?
We think that it is important to work towards pay equity and providing a living wage to all employees. Of course there are many challenges to running a business – and labor cost is high among them. Still, it is our priority to continue to work on leveling the playing field for wages in our businesses, and pay our employees the most we can while running a healthy business.
How will I know how much more than my hourly wage I will make?
Each paycheck there will be a line separate from your regular hourly wage that will show your additional earnings from the admin fee.
So now – if the restaurant is busier – we are ALL making more money?
How does the increase in FOH per hour wage affect labor cost?
It raises the labor cost to each business significantly. We have decided though, that working away from the tipped minimum wage is an important step in providing wage stability to all of our staff. We plan to use some of the PPP money we’ve received to help us handle this additional expense, but we will need to work creatively on the long term plan for how the businesses can afford to keep this going. We’ve committed to giving this model a real chance – we plan to reevaluate at 3 months and 6 months, and also accept that it may not be realistic at this time. If that is the case, we will reevaluate everything to see how to keep moving forward with equity and living wages as our guide.
Does all of the Administrative Fee go to staff?
Yes, all of the Administrative Fee is dispersed and accounted for into non-ownership labor wages and labor expenses each pay period.
Does the payroll expense increase?
Yes, when payroll increases taxes also increase.
Is the loss of tip credit significant?
It does affect the owners and the company investor’s personal taxes. However, taxation is limited as it is a flow through.
What’s the formula for distributing the Administrative Fee?
Each pay period, we will calculate how much money has come in from the Administrative Fee and will distribute it to all employees based on hours worked. Each restaurant model is a little bit different, so the exact breakdown varies at each location. The goal is equity. Salaried managers may get a lower percentage than hourly employees because their base wage rates are higher. Additionally, some non-tipped employees may get a slightly higher percentage since they aren’t allowed to share in the tips.
Are we planning a rainy day fund with any of these monies?
No, we think it is better to distribute all of the money each pay period.
WHAT DOES ‘GUARANTEED MINIMUM’ MEAN?
The base wage for any employee in the company starts at $13.50. Base wages increase depending on years with the company, as well as experience, skill level, and responsibilities of the position. All employees are guaranteed a minimum of $17/hr. This means that if tips and the Administrative Fee don’t get an employee to $17, the business makes up the difference to ensure that ‘take-home’ rate.
Do we plan not to take tips when they can be legally shared with the whole staff?
Unfortunately, we don’t have all the answers right now, and it’s hard to know what might be different when/if tip sharing is allowed. If tip sharing were allowed today, we would be allowing them to come in (as we are currently!) and would happily share them equitably with all of our staff.
HOW DO WE EXPLAIN THIS NEW PAY STRUCTURE TO OUR BOH EMPLOYEES WHO HAVE GROWN ACCUSTOMED TO OUR REVENUE SHARING PROGRAM?
The Revenue Share is being replaced by an Administrative Fee and it will be at least $3/hour extra. This is more money than our Revenue Share was able to provide. All employees are guaranteed a minimum of $17/hour.
When are employees eligible?
Newly hired staff are eligible right away.