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Danny Meyer, along with other renowned operators in the restaurant industry have been on the forefront of the no-tipping movement.
This is a policy where employees are given higher wages instead of relying on tips.
Meyer, in particular, is known for putting his employees first. He maintains that happier employees foster more enjoyable guest experiences and this mentality has attributed to his success in the industry.
Meyer’s name is often in headlines celebrating his industry efforts, but yesterday it was reported that Meyer, along with other big names in the business are being sued over their no-tipping policy.
The lawsuit claims that Meyer, Tom Colicchio founder of Craft Hospitality, and David Chang of Momofuku conspired to implement the no-tipping policy as a way to overcharge guests, while also stealing tips from their employees.
“The conspiracy is in its early experimental stage, focused on developing and disseminating best practices for switching to a no-tipping, “hospitality-included” business model. The no-tipping movement is the most significant issue in the industry today. One conspirator predicts that “ten years from now we’re going to look back and go, ‘Oh, God, do you remember when we used to tip?’” according to the complaint. “The ongoing conspiracy unlawfully transfers millions of dollars from customers and servers to restaurant owners in violation of federal and state antitrust laws. Participating restaurants and a compliant media have portrayed the no-tipping/higher prices movement as intended to promote social justice and equality, while the real aim and effect is greater profit at the expense of workers and consumers.”
The plaintiffs are seeking class-action status.
Meyer's Union Square Hospitality Group assures that the transition to the no-tipping policy was in the best interest of the employees and there was no malicious hidden agenda.
"We undertook the challenging and lonely journey of introducing Hospitality Included to create clear and transparent growth paths for our people while beginning to address the decades-long growth of inequality among restaurant professionals," said Union Square Hospitality Group in a statement. "We believe hospitality can and should be a viable career with competitive wages, and we are more committed than ever to Hospitality Included getting us there."
The suit is claiming that Meyer and Colicchio "colluded” together and cites tweets about the no-tipping policy between the restaurateurs as “evidence.”
Do you think this case will hold-up in court? Is this allegation too much of a long shot?