Portland Restaurateur Calls Going Tip-Free ‘Terrible Decision'

Speaking with the Portland Business Journal, restaurateur Kurt Huffman says the decision to eliminate tipping at Loyal Legion was "terrible," announcing tipping is now welcomed at the inner Southeast beer hall. Opening in 2015, Loyal Legion made a splash by eliminating tipping and increasing employee wages to $15 for staff and $18 for waiters. To afford the new business model, Loyal Legal modestly increased prices, such as serving $6 beers.

At the time, Huffman acknowledged waitstaff at Loyal Legion would likely earn less than other waitstaff, and it appears he was right. Speaking with PBJ, Huffman said he recently told his staff, "Guys, I feel like I've come up with a business model where I'm having you guys make much less money than you could be making." Huffman said his staff was constantly returning tips to customers and that the experience taught him how "willing people are to leave tip money." Huffman did not comment on whether Loyal Legion would lower the price of its food and drinks.

At a time when creative business models for restaurants and eliminating tipping are hot issues, Huffman's experiment is one of the few capable of shedding light on what could happen if more restaurants eliminate tips. Huffman told PBJ, "It took me eliminating them to see just how valuable they are," and he reports that, after reinstating tipping, Yelp reviews improved almost instantly and service became faster.