2267 Kearney Street, Denver CO 80207

LWS Info

Why we changed our business model, and why you
see a surcharge fee on your bill.

We have made a change to our business model in order to be able to pay our non-tipped employees more fairly in relation to the rest of our team. The disparity between tipped staff and non-tipped staff compensation has been growing for many years. We want to do this for the benefit of our team as a whole. We want:

· To be transparent to all about what we are doing.
· To explain why we are doing it and why it is so important to us and our industry.
· To ask for support as we implement a new approach.
Generally in restaurants, tipped service members can make 2-3 times as much as non-tipped employees. The fundamental issue underlying this widening gap, is that tipped employees are tied to top-line revenue increases and tipped minimum wage increases, whereas non-tipped employees are tied solely to bottom line results.

The surcharge was put in place to help the non tipped employees have higher pay rate. One that will minimize the pay gap between the tipped employees and the non tipped employees. If we raise prices, then the guest just has a larger bill and the server gets a larger tip. Our tipped employees have also had a minimum wage price increase of about $6 per hour over the past 3 years (mandated by the state and the amount varies by city). That price increase works out to be almost 30k each year for the restaurant. Our margins are already so incredibly thin and this increase is almost crippling. The living wage surcharge enables the non tipped employees the pay increase that they deserve (well above minimum wage).
Every time we increase menu prices to cover inflation somewhere in the expense structure, we cover the expense but widen the wage gap. Every time there is a mandatory tipped minimum wage increase, it widens the wage gap. How can we as owners tolerate a scenario whereby half of our team’s compensation is about 50% lower than the other half’s? We need to connect (at least part of) their compensation to top line revenue if we want to correct the disparity.

We are implementing a 8% Livable Wage Surcharge to your bill.  We know many people will ask, “Why don’t you just raise your prices? Our response is that in fact we are raising prices, albeit in a different way that specifically aims to close the wage gap between the tipped staff and the non-tipped staff.
We are a smaller, independent restaurant, and we do not want to sacrifice craft or integrity in order to serve the community that we love so much, we believe this is a fair, effective, and sustainable approach. Our hope is that by making the compensation more equitable, we are cultivating a team of employees that feel more valued and respected.  We support our community, other local businesses, local farmers and our staff.   We thank you for your understanding and support as we move to create more of a balance.

(This letter is very slightly revised from Duo Restaurant & Centre Street Café)