Thomas Keller's Per Se restaurant pays $500,000 to waiters after cheating staff from tips

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  1. uggboy
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    uggboy Gold Member

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    Thomas Keller's Per Se restaurant pays $500,000 to waiters after 'cheating staff from hard-earned tips'

     
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  2. NYBanker
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    NYBanker Gold Member

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    This article doesn't really lay out what happened. It suggests the "service charge" was not apportioned to front of the house staff....yet also says no employee money was originally withheld.

    I wonder what really played out.
     
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  3. iolaire
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    iolaire Gold Member

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    This one explains the issue:
    http://money.cnn.com/2015/07/02/pf/per-se-fine-tipping/

    In general Per Se was charging a fee like say a hotel's amenity fee, but at times in they described it as gratuity so the State said it should have gone to the employees. I'm generally pro employee rights but from what I've read is the employees were not really short changed but rather the restaurant stuck a "bogus" fee on top of private events and at times tried to explain it as gratuity rather than explaining it was to cover the restaurants costs...

    Likely that description of the fee as a "gratuity" was some sales type person trying to justify why they were charging a 20% fee on top of the quoted prices. Which leads me to wonder did private dining not already have its own price sheet with higher prices, or were they at menu prices plus the additional fee?

    also:
    Per Se updated the language in its private dining documents in the second half of 2012, to rename the charge "operational" and clarify that it doesn't cover gratuity, according to the agreement.
     
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  4. mattsteg
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    mattsteg Gold Member

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    A clarification - the article quotes the restaurant as stating that no employee money was withheld. If they were not planning to disburse the service charge (even though clearly they should have been...and were in fact legally required to do so) I guess you could say that they never considered it to be employee money...

    The big question is how long prior to the law changing were they presenting a 20% service charge that looked like a gratuity to customers (and thus makes them less likely to tip/tip well...) ...but wasn't. I suspect that they were doing this prior to the law change, kept doing it, and then eventually revised their language in accordance with the law.

    It looks like they were charging a "service charge" (which I expect many see and equate to gratuity, from @iolaire's link apparently including their employees...) to cover operations costs. The law changed to state that any service fees, unless clearly disclosed otherwise, were to be disbursed as gratuities, and they did not implement that change until almost 2 years after the law had been in effect.
     
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  5. HaveMilesWillTravel
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    So they tried to hide true price and nickel and dime their customers and shot he selves in the foot to the tune of $500,000. Love it.
     
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  6. violist
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    violist Gold Member

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    OK, so there were these events at the restaurant, and there was a 20% service charge
    at the bottom of the bill, none of which went to the waitstaff. So did these folks think
    that they were being stiffed tips for all these shindigs, or what? Sounds like after one
    or two occurrences, the servers should have figured something was amiss.
     
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  7. HaveMilesWillTravel
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    They may not have been aware of their rights under NY law.

    http://www.ag.ny.gov/pdfs/PER_SE_AOD-EXECUTED.pdf
     
  8. iolaire
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    iolaire Gold Member

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    Keep in mind Per Se's prices have been inclusive of gratuity:
    http://www.grubstreet.com/2013/06/restaurants-dont-accept-tips.html
    Per Se, New York City and the French Laundry, Yountville
    Gratuity included the $295 price of the nine-course menu, but additional tips aren't forbidden. Thomas Keller uses the same system at his Napa Valley restaurant.


    But this article claims there will be a 20% service charge in 2005 that would be shared with the staff:
    http://forums.egullet.org/topic/72290-per-se-ends-tipping-in-favor-of-service-charge/
    LET'S hope this trend doesn't catch on. Master chef Thomas Keller's extravagantly priced Co lumbus Circle restaurant Per Se is axing the tip. Starting Sept. 1, customers will no longer get to decide how much of a gratuity to give the waitstaff — instead, a flat fee of 20 percent will automatically be added to each and every bill, regardless of the size of the party, with proceeds to be divided equally among all the restaurant's staff. That's sure to be popular with the busboys, but one insider tells us, "Most of the service staff are planning on quitting at the end of this month when the salary changes happen." The restaurant issued a statement saying the changes were designed "to further the establishment of a unified work culture within the restaurant."

    so that goes against my argument unless something changed between 2005 and 2012.
     
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