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Monday, July 28, 2008

Pure Greed, Bad Faith and Broken Trust in Cleveland

Oh, one thing I forgot to tell you, before leaving, was that I would be in Cleveland, Ohio for a long weekend. It's the annual baseball trip wherein my husband and I get together with about 35 of our closest friends to watch the Indians snatch defeat from the jaws of victory one more time. Cleveland fans have a bizarre masochism. And nostalgia, either for 1948, which was the last time they won a World Series, or for the mid 1990s, when they almost did.

Anyway, we see a few games, go out to some really nice restaurants for dinner and I marvel at my friends amazing tolerance for this Yankee fan.

It's the restaurant part that has caused a major brouhaha in Cleveland. This, I am happy to report, has nothing to do with any bad manners on our part. It's actually because of an article in the Cleveland Plain Dealer by award winning journalist and first lady of Ohio, Connie Schultz.

According to Schultz, in this article, an Ohio restaurant chain, Yours Truly, has begun skimming the tips of its servers. They take about 1 to 3 percent off all gratuities that are included when a customer pays his check with a credit card. The restaurant chain claims they are merely making the waiters contribute to the processing fee the restaurant must pay on each credit card transaction.

But restaurants, by law, pay their servers well under minimum wage. In fact, they are allowed to pay as low as $2.13 an hour in Ohio. The rationale for this is that waiters can more than make up for that in the tips they make. And in upscale restaurants, where customers routinely give 20 percent of a hefty check for good service, that is probably true. But in the average family restaurant, where the bill is considerably less expensive, most customers give 10 to 15 percent because that's what they can afford.

Here's what Schultz said:
What servers won't tell you, unless you ask, is whether they get to keep the full amount of tips left on a credit card.

Sadly, this is an increasingly urgent question to ask. In Northeast Ohio, for example, it should be on the tip of any tongue dining at Yours Truly restaurants, where management recently decided that servers should help cover the processing fees charged by credit card companies. Depending on which card is used, servers lose 1 percent to 3 percent of every tip not paid in cash. That adds up for people making so little.
The company president, Lawrence Shibley, thinks this is fair because "times are tough" for the restaurant chain. But the same times are even tougher for the servers.

I'm sure that most Yours Truly employees would love to say they are breaking even this year -- or any year, for that matter. I'm also pretty sure that, despite Shibley's claims otherwise, most Yours Truly customers would appreciate knowing that the tipping policy has changed.

"I don't really think that's necessary," Shibley said. "This is between us and our employees."
And that brings us to an even bigger problem for this restaurant chain. Most customers didn't know this and many have been reacting with as much outrage at this as Schultz did. And she expressed it cogently.
Now, see, that's exactly the kind of attitude that gets customers riled up. You can't demand that we subsidize your employees' wages and then get testy when we insist on a few ground rules. Every last cent of a tip is meant to go to the person who waits on us. Period. And we deserve to know if management has decided otherwise.

Shibley said "lots of other restaurants" are now doing this. Well, Yours Truly isn't supposed to be like other restaurants. At least that's the claim on its Web site, which boasts of striving for "open, honest and fair communication" and insists that, while "financial strength is always within sight and a priority, the bottom line is not our top goal."
And that's what's riled Schultz and other customers the most. In addition to taking advantage of their employees, Yours Truly has violated the trust of their customers. They've misrepresented themselves and cheated their employees. And how have Cleveland customers responded?

All the people I've been with this weekend have been paying with credit cards but leaving cash tips. And not just in Yours Truly. We've been doing it even at the most upscale places. As one friend, himself a businessman, put it gleefully, "This way the restaurant still has to pay the service charge on the credit card but they can't stiff their workers."

A very important point to remember about Cleveland is that it's a working class town. Even the yuppies all have a father, mother or grandfather who was in some union. And lots of successful people worked their way through college by waiting tables. So there's a lot of sympathy in that town for those who serve them. And a lot of anger at a successful restaurant chain that would pull a stunt that reeks of pure greed.

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