Restaurants Canada wants more industry innovation as Halifax restaurant scraps tipping

As a new Halifax restaurant bids farewell to tips, a Restaurants Canada vice president says more restaurants should be innovative.

On Oct. 29, Coda Ramen opened on Gottingen Street in Halifax’s north end. Instead of accepting tips, staff are paid higher wages — around $17 to $22 an hour — and receive health benefits.

“I don’t think it’s a good or bad idea,” Luc Erjavec, the Atlantic Canada vice president for Restaurants Canada, tells NEWS 95.7’s The Todd Veinotte Show. “I think it’s just showing the resilience and the innovation of the industry to try to get through these tough times. Restaurants are trying to make themselves stand out. They’re trying to try something new that’s going to work.”

In a CBC News article, Coda Ramen owner Jamie MacAulay says senior cooks and staff will earn $22 an hour — the amount that’s deemed a liveable wage in Nova Scotia. New staff will work their way up to that amount.

In the article, MacAulay also says the tipless system means staff will receive a more consistent income that is “significantly higher” than minimum wage plus tips. To offset the increase in costs, prices on the restaurant's menu will be increased.

MacAulay was also the owner of Water and Bone, a ramen restaurant in Halifax’s north end. That is until the COVID-19 pandemic forced him to shut down the business.

“Restaurants are really suffering,” says Erjavec. “Forty-five per cent of them are operating at a loss and only 25 per cent are breaking even. They’re operating at 45 per cent capacity, so you have to do something to try to get through these times.”

Changing the tipping system has been relatively new in Canada. For instance, three restaurants in Toronto have eliminated tipping while another has added a mandatory 15 per cent gratuity to takeout orders.

“We [restaurants] really are central to community and we’re suffering,” Erjavec says. “We’ve taken extreme measures to mitigate the risks to our customers and staff. We urge you to come out and support our restaurants.”