North Carolina restaurant adding 20% ‘fair wage service fee’ to every bill

National and World

DURHAM, N.C. (WNCN) — A restaurant in Durham, North Carolina, says it is now paying employees a fair wage but is passing the cost on to consumers.

Pizzeria Toro added a 20% gratuity called a ‘Fair Wage Service Fee’ to every bill for dine-in customers. The receipt will also have a message saying “seen and unseen hourly wage workers are the backbone of the restaurant.”

Gray Brooks is a chef and one of the owners of Pizzeria Toro. He said some prep cooks and dishwashers had to work two jobs.

He sees the fee as a way to close the wage gap between staff who traditionally did not make tips and those who did.

“The restaurant business is such a slim margin business, we were paying them as much as we could and it wasn’t enough,” Brooks said. “This was a way to sort of take that extra income and spread it out so that everybody was making enough to make a living.”

Brooks said a living wage to him means enough money to pay bills, with a little left over every week.

He said he considered raising prices by 20% and eliminating tips but said he felt this was more transparent. He said the restaurant is not expecting additional tips.

Bartender Arturo Sanchez already made tips. He said closing the gap means he could end up with a little less some days, but it’s a trade-off because he won’t be short-changed during an off night.

“A little bit of a decrease in terms of what we’re bringing home every day, but that is gonna be sort of mitigated by the fact that there is less of a stress, and the knowledge that we’re sharing those tips with employees all throughout the restaurant,” Sanchez said.

Sanchez said he hopes the practice spreads to more restaurants.

Brooks said customers have been mostly supportive, but that there’s been some online pushback from people who say they wouldn’t tip in the case of bad service.

According to the MIT Living Wage Calculator, the living wage for a single adult in Durham County is $16 an hour, more than double the current minimum wage.

The Durham Living Wage Project recognizes employers in the area it says pay a living wage. The list includes about 20 restaurants and breweries.

Pizzeria Toro said it is not certified as a living wage business by the group since its living wage is not fully paid by the employer, with the 20% gratuity coming from customers.

Customer Lily Johnson said the fair wage service fee makes her more likely to go to Pizzeria Toro.

“The most important thing is just to keep your employees happy, and I think that’s really awesome that they’re doing that,” Johnson said.

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