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Famous Chef Weighs in on the Taxing Issue of Tipping


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Chef/owner Eric Ripert of famed Le Bernardin on a panel at RFDC.

Eric Ripert, chef and co-owner of Le Bernardin, considered one of the best restaurants in the world, had a different take on the hot issue of eliminating tipping, which opponents say will mean raising the cost of menu items. Ripert, who was part of a chef panel at the Restaurant Finance and Development Conference in Las Vegas, November 9-11, said the state and local government are the only winners if tipping is eliminated, because it will be collecting more sales taxes on higher food bills.

Restaurateurs with percentage rent leases also will take a hit because the revenue they pay rent on will be artificially inflated because of the higher prices dues to the elimination of tips, said Sam Goldfinger, CFO of the One Group, a public restaurant company.

Rohini Dey, owner of the Vermillion Group, said that while she’s not against tipping, she thinks the real issue is how to repeal laws that don’t allow tips to be shared with the back of the house. While the front of the house gets the glory, it's the kitchen, or production center, where the skill and dedication of the cooks should be rewarded in the same manner as the servers, she pointed out.

Tipping is also an incentive for servers to take good care of guests, said Ripert. The French chef added that in his travels overseas, he’s noticed restaurants that don’t have tipping often don’t offer up-and-beyond service. Extraordinary service is compulsory in fine dining, he added.

Whether restaurants raise prices to compensate for no tipping and higher minimum wage won’t be totally up to the industry, one audience member pointed out. “You can only pass it on if the consumer will let you,” he said.

But all is not doom and gloom. “I remember when smoking was banned,” Goldfinger said. “I thought, ‘there goes the industry.’ There’s always something. As an industry we’ll figure it out.”

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Tom KaiserTom Kaiser is associate editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
 
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Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
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Nancy WeingartnerNancy Weingartner is editor-at-large of Franchise Times magazine and the editor of the Food On Demand media project. You can reach her at 612-767-3200 or at nancyw@franchisetimes.com.
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