Atera Goes Service-Included, Tipping No Longer Necessary

As New York State prepares to raise the lowest base rate of pay for waiters and other tipped workers to $7.50/hour, bringing that wage closer to the higher full-minimum earned by cooks and dishwashers, another high profile restaurant is taking steps to make such distinctions virtually irrelevant by eliminating the need to tip. When Jodi Richard's Atera reopens (later than expected) next week with a new chef, the tasting menu-only counter spot will adopt a European-style service-included system wherein all prices will reflect the full cost of dining, minus tax. The policy will allow Richard to better compensate kitchen staffers and offer health insurance to her employees.

Chef Ronny Emborg's 18-course menu will cost $235 when dinner service resumes next Tuesday. Patrons will not expected to leave gratuity; for comparison's sake, a similar tasting would cost about $188 at restaurant where a 20 percent tip is customary. That's a proper price drop from Atera's previous menu under chef Matthew Lightner, who charged $225 before tip, or $270 after. Wine pairings, previously $165 before tip, are now $195, service-included – roughly the same amount.

"Ronny and I together feel strongly about the fact that we have a really good group of people working with us and we want to do whatever we can to keep them," Richard tells Eater. Under the service-included system, "We can even out the salaries among everybody and have the money to be able to add health-insurance on top of that."

Despite having a lower minimum wage, waiters in New York make an average of $15.30/hour, compared with cooks, who make about $13.00, according to a Payscale survey. That disparity between front-of-the-house and back-of-the-house pay can be difficult to rectify because the bulk of a waiter's compensation often comes in the form of tips, which are considered the legal property of the employee, and which cannot be redistributed to cooks or dishwashers. Instituting a service-included policy (or levying a service charge) generally lets a restaurant count the money that would have otherwise gone to tips as revenue, meaning it can use those funds to raise the salaries of employees who don't typically count on gratuities.

Atera's back-of-the-house employees should see their salaries rise by about 15 percent. Waiters might see their nominal pay reduced "slightly," Richard says, but adds that the difference could be made up by the "optional additional tip" line she'll likely add onto the bottom of the check. "Even though we say you don't have to leave a tip, some people can't help themselves. We're not counting on that, but we know that's going to happen."

Atera, with 13-seats situated around a u-shaped chef's counter, has 21 employees, eight of whom would be tipped at a more typical restaurant.

The anti-tipping movement has never quite reached critical mass in New York. Susan and Barry Wine were pioneers in this regard, instituting a service charge at The Quilted Giraffe in the 1980s, long before there was a vibrant national debate over how hospitality industry workers should be compensated. Thomas Keller, in turn, is the more contemporary father of bringing European pricing methods to the states. In 2005 the chef adopted a service-included policy at New York's Per Se to avert an exodus of cooks unhappy with their pay, according to the Times; the system had already been in place at his French Laundry in Napa Valley, California.

Few followed Keller's lead. The Chef's Table at Brooklyn Fare adopted a service charge, a policy that the two-Michelin starred Atera also would try out and eventually drop. But besides Per Se, the only real big-name NYC restaurant to go full on service-included was Sushi Yasuda in 2013.

Even across the U.S., most restaurants that move to de-emphasize tipping opt for the service-charge system; among the most prominent venues doing so are Alinea, Atelier Crenn, 42 grams, EL Ideas, Coi, Saison, and Benu. Adding 20 percent at the end of the meal – or before the meal in the form of a pre-paid ticket – seems to closely more mirror the American practice of tipping, minus the voluntary nature. The service-included path, ubiquitous throughout France and Europe, is riskier in the U.S., as it involves raising the prices of everything from wine to tea to cocktails to reflect what the customer would have ended up paying with with tipping. The means the cost of dinner can appear significantly higher to patrons unaware of the policy.

Take the entry-level Champagne at Per Se, a glass of Jose Dhondt that runs $34. It's expensive, but it's technically cheaper than the lowest priced champers on Eleven Madison Park's list. That glass, a $29 pour of Bereche et Fils, works out to $34.80 after tip.

"Without enough restaurants doing service-included, I worry that I would lose people walking by who think we're too expensive," Amanda Cohen told Eater late last year, during an interview about her plan to institute a service charge of sorts at Dirt Candy. "What are we going to do? Run out each time and say, 'Wait, here's our manifesto. Service is included!" Indeed, Daniel Patterson, who levies a service-charge at his two-Michelin-starred Coi in San Francisco, abandoned a service-included policy at his more casual Aster in the city's low-key Mission District. "Can't make all-inclusive work in a casual place yet. But we'll keep trying!" the chef tweeted.

The benefit of a service-included policy, like the one at Atera, is that diners have a more transparent picture of what dinner will cost going into the meal. The price on the menu is the price on the check, with only tax added afterward. "I think it's going to be a relief for people to get a bill and not have to worry about throwing more money on top of it."

And most staffers should be happy about the health insurance plan; Atera will pay the full monthly premiums of its employees, a generous policy even by large corporate standards.

Some other quick notes about Atera 2.0:

• The cancellation window will drop to a much more lenient three days at the new Atera. Previously, guests who cancelled their reservations within seven days of a reservation were subject to being charged the full menu price per person, plus tax.
• Atera will charge approximately $70 for its "tea progression" to pair along with dinner. The non-alcoholic "temperance pairing" will cost around $85.
• As was the case with Atera's final menu under Matthew Lightner, the restaurant will not currently levy supplements for any menu items, as is common at Per Se and elsewhere.