Durham’s Monuts Donuts has never been afraid to go against the grain.
When Lindsay Moriarty and Rob Gillespie launched the breakfast joint in 2011, first selling donuts off the back of a custom tricycle, they were already actively committed to paying their employees a living wage. In the subsequent years, Moriarty and Gillespie proved the sustainability of their novel business model.
After they opened a bustling brick-and-mortar bakery and brunch spot (originally on Parrish Street, now on Ninth Street) more than a dozen local restaurants followed their lead in becoming living wage certified. The move created a new norm, helping to shift the conversation around the conditions of industry workers in the community.
But last year, as the pandemic devastated restaurants and social justice movements gripped the nation, Moriarty and Gillespie realized they needed to break conventions once again. This April, with hopes that they might be able to spearhead another standard for Durham businesses, Monuts went entirely tip-free.
INDY Week: Why did you go tip-free?
Lindsay Moriarty: It’s something that Rob and I have thought about for a long time. We always had a hard time seeing how to make it work, because it’s so ingrained in how restaurants run. But then during the pandemic, a few things happened.
One was that the Black Lives Matter movement really took a footing. As business owners as we watched that unfold and asked ourselves, “What are we doing to participate in the systems of racism that are built into our institutions?” Tipping began as a way for white business owners to pay certain professional classes less than a minimum wage. The industries that got put into this class were typically held by African Americans, so it was basically white people’s way of paying black people less.
The other thing was that we saw tips increase significantly during the pandemic. It was wonderful that customers were attuned to the plight of restaurants and felt like they could chip in, but on the back end what was happening was a discrepancy between what our front-of-house and back-of-house employees make. It misrepresented how we value our employees across the restaurant, and created a little bit of tension that folks in the back knew how much folks in the front were making. By and large, the way other restaurants address this challenge is by pooling tips and then distributing them to the back-of-house as well. And that does reduce the disparity between the different departments, but it doesn’t change the fact that they’re participating in a system that has racist and sexist roots. It seems more like a band-aid than an actual solution.
Can you say more about how tipping perpetuates sexism?
There’s a lot of research that shows how you can increase your tips. At the tops of those lists are always smiling more, dressing a certain way, being a certain type of person to accommodate what customers want. I think that’s ridiculous. Tipping never correlates with the quality of service; it almost always correlates with artificial indicators that have more to do with what a person looks like than how they do their job.
We’ve always pooled tips at Monuts, so in some ways that has corrected for what individual consumers tip for one employee versus another. But participating in the system, even if we are insulated from its worst effects, is still turning a blind eye to the bad parts of it.
How do you anticipate the pandemic changing tipping norms?
We definitely saw tipping increase over the pandemic. I don’t know if that’s going to be a sustained thing as things return to normal. I know that our customers have been really enthusiastic about a switch to no tipping, so if more restaurants start to go that way, maybe a bigger shift could be brought on by consumer activism, like consumers saying, “Hey, we would pay higher prices if we didn’t have to tip.” Because it shifts things the way it should be, as opposed to leaving part of the wage in the consumer’s hand.
What are some concerns you have about eliminating tips?
One of our biggest concerns was that in raising our menu prices by 15% we would lose customers, but in the past we’ve been fortunate that our customers respond well to our political and social missions. The other major concern was that, in going tipless, the front-of-house was going to take a pay cut, even if the back-of-house was going to have an increase.
We met with all of our staff members one-on-one to explain why we were doing it and what their wage would be afterwards. We were expecting to lose staff members over it, but we did not. When we initially set what the tipless range would be, it ranged from $16 to $22 an hour, with the average around $18. Our hope is that by the end of the year, we’ll be able to continue to funnel excess profits back into staff wages by way of raises and bonuses. If, at the end of the year, Monuts has managed to be more profitable as a result of higher prices, we have every intention of putting that money back into our employees’ pockets.
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