Surprise, Diners: It Turns Out We Like to Tip Our Waiters

What's Hot

2 Types of Black Marks Might Vanish From Your Credit File SoonBorrow

6 Ways the Obamacare Overhaul Might Impact Your WalletInsurance

7 Dumb and Costly Moves Homebuyers MakeBorrow

This Free Software Brings Old Laptops Back to LifeMore

Obamacare Replacement Plan Gets ‘F’ Rating from Consumer ReportsFamily

Beware These 12 Common Money MistakesCredit & Debt

21 Restaurants Offering Free Food Right NowSaving Money

17 Ways to Have More Fun for Less MoneySave

House Hunters: Beware of These 6 Mortgage MistakesBorrow

30 Household Uses for Baby OilSave

25 Ways to Spend Less on FoodMore

Nearly Half of Heart-Related Deaths Linked to These 10 Foods and IngredientsFamily

5 Surprising Benefits of Exercising Outdoors in WinterFamily

10 Ways to Save When You’re Making Minimum WageSave

Boost Your Credit Score Fast With These 7 MovesCredit & Debt

7 Painless Ways to Pay Off Your Mortgage Years EarlierBorrow

The Most Sinful City in the U.S. Is … (Hint: It’s Not Vegas)Family

The True Cost of Bad CreditCredit & Debt

10 Companies With the Best 401(k) PlansGrow

This Scam Now Tops ID Theft as the No. 2 Consumer ComplaintFamily

6 Stores With Awesome Reward ProgramsFamily

6 Ways to Save More at Lowe’s and The Home DepotSave

6 Healthful Treats for Your DogFamily

New Study Ranks the Best States in the U.S.Family

Thousands of Millionaires Moving to 1 Country — and Leaving AnotherGrow

Strapped for College Costs? How to Get the Most From FAFSABorrow

6 Overlooked Ways to Save at Chick-fil-AFamily

Ask Stacy: What’s the Fastest Way to Pay Off My Mortgage?Borrow

Where to Sell Your Stuff for Top DollarAround The House

8 Ways to Get a Good Price on a Shiny New AutoCars

Ask Stacy: How Do I Start Over?Credit & Debt

Secret Cell Plans: Savings Verizon, AT&T, T-Mobile and Sprint Don’t Want You to Know AboutFamily

30 Awesome Things to Do in RetirementCollege

14 Super Smart Ways to Save on TravelSave

The Rich Prefer Modest Cars — Should You Join Them?Cars

You’ll Soon Pay More to Shop at CostcoSave

10 Ways to Save When Your Teen Starts DrivingFamily

Many Americans complain about tipping the wait staff when dining out. But when this restaurant chain experimented with a no-tipping policy, it backfired.

Joe’s Crab Shack made headlines last November when it boosted its servers’ hourly wages and adopted a no-tipping policy at 18 of its 131 restaurants. Now, just six months into the trial run, the popular casual seafood chain is pulling the plug on the no-tipping policy and reverting back to the standard gratuity model at all but four of the test restaurants.

It turns out the no-tipping policy was not only unpopular with Joe’s workers, but the majority of its customers also disliked it, Nation’s Restaurant News reports.

“[O]ur customers and staff spoke very loudly [about the policy],” said Bob Merritt, CEO of Joe’s Houston-based parent company Ignite Restaurant Group, in an analyst call last Wednesday. “And a lot of them voted with their feet.”

Joe’s Crab Shack hiked the wages of its servers and raised its menu prices at the no-tip restaurants to cover the increased labor costs. Merritt said the pilot restaurants saw an 8 to 10 percent drop in customers after implementing the no-tipping policy.

The restaurant chain’s research revealed that about 60 percent of its customers disliked the change in the tipping policy.

“Merritt said customers disliked the no-tipping policy for two reasons: first, they didn’t want to lose control of incentivizing service, and secondly, they didn’t trust management to pay the increase price to employees,” said Restaurant News.

As it reverts back to the standard gratuity model at 14 of the test sites, Joe’s also plans to roll back prices at those locations.

According to CNN Money, the no-tipping policy will remain at four of the fast-casual seafood restaurants where it was well-received. Merritt said his company will also try and identify the reasons why the policy works at some locations and not at others.

“The system has to change at some point,” Merritt said.

Do you think tipping is an antiquated model for restaurants? What do you think of the Ignite Restaurant Group’s decision to drop the no-tipping policy at 14 of the 18 locations where the policy was tested? Share your comments below or on our Facebook page.

Stacy Johnson

It's not the usual blah, blah, blah

I know... every site you visit wants you to subscribe to their newsletter. But our news and advice is actually worth reading! For 25 years, I've been making people richer without making their eyes glaze over. You'll be glad you did. I guarantee it!


Read Next: 10 of the Most Fantastic Train Trips in the United States

Check Out Our Hottest Deals!

We're always adding new deals and coupons that'll save you big bucks. See the deals to the right and hundreds more in our Deals section.

Click here to explore 2,060 more deals!