RyanRYAN WALLACE OPENED A GREAT PUB here in Fort Collins three years ago.  William Oliver’s Publick House has great food, wonderful drinks … It’s a place that you enjoy taking friends.

But there’s a lot more to the story.

I found out that they instituted a no-tipping policy last September, so I was eager to find out why he made the decision and what the results have been.  After all, very few restaurants have the courage to make this magnitude of change.

Let’s be absolutely clear that tips are usually a large portion of food service workers’ take-home pay, so eliminating this source of income could be devastating.  It’s critical to design a system which gives employees fair pay and benefits.  Including, in this case, profit sharing and a retirement plan.

This is a big shift, both for employees and customers.

It’s delivering results.  Ryan has lowered employee turnover while increasing their quality of life – because they’re now able to plan on a reliable income.  The bottom line for the company has improved, and it’s more sustainable.

William Oliver'sThe customer response has been interesting.  He’s actually lost a few customers over this shift: people who relate to the loss-of-tips aspect without understanding that employees are happier with building a career with a respectful employer.

And this shift from “job” to “career” is an important one.  When employees are given respectable pay and benefits, they want to stay not only with the company but make it a more permanent part of their life.  They’re more interested to develop themselves, take initiative, and engage in their work.

The customers who are most loyal are the ones who get this.  They experience the change in viewpoint, and start treating their servers more professionally.

I’ve observed this same shift in other countries outside the US, and I’m thinking that our society’s addiction to tipping might actually increase our workers’ tendency to focus on the short term rather than making a professional career.  It’s just a theory, but there may be a correlation.

A net effect of this change has resulted in a reduction in the number of customers who might enjoy taking advantage of their waitstaff, replaced by those who enjoy more professional interactions.

I admire that Ryan and his wife made this change not just to improve the business, but also as a social issue.  They just believe that this company has an obligation to contribute to the community through the employment it provides.

What’s next?  Well, this policy is just six months old, and there may be more steps to work through.  For instance, there’s tax implications that I wasn’t even aware of.

Beyond that, Ryan plans to continue building business through great product and service, and providing a great environment for customers and employees.  Modest improvements based on courage and the desire to do the right thing.