Wednesday, May 4, 2016

Restaurant Tipping Crackdown



In the U.K's City AM publication of Wednesday, May 4th 2016 under the Forum section Ryan Bourne (Head of Public Policy at The Institute of Economic Affairs) seemed to be commercially driven in that article. He tried to justify the bid by restaurants to deduct tips from the wages of waiters. He noted that the "diverse nature of the restaurant trade means that imposing these sorts of regulatory strait-jackets can have unintended consequences". If there are going to be consequences it is likely that they will be in forms of revolt and paybacks for being forced to pay the Living Wage and unable to make up for it from tips. To cut a long story short the tips do not belong to restaurants, they are not and should not possibly be in the trade to cash in tips, the patrons can be charged more to make up for the increased labour costs. What belongs to them is what the patrons pay for the meals and if they wish to add the value of the experience to the cost of the meals they can do so and it really cannot be regulated. They have the freedom to set their prices, but the tips do not belong to them, they belong to the waiters regardless of whether the restaurants are high-end or have casual chefs. What is wrong in this issue is that the restaurant trade is trying to modify its model and it is has come up or will come against Social Norms. He ended the article that Social Norms are important in market economies but should not be imposed by law. The restaurant trade should notice that they are trying to adopt a model that will not pay them as it will come against Social Norms. If the Norm is not imposed legally or at least through other policy means; would it not obvious that the restaurants will be taking away what does not belong to them? 
---Ugo Unamka

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