Waiting for tips — and wages

How waitstaff gets paid affects not only the waiters but also the restaurateurs and customers.

A waitress
On a Wednesday afternoon in Tel Aviv, I plopped my laptop on a table at a branch of the café bakery chain Roladin. The waiter noticed my presence, and as I set up my laptop, it didn’t really bother me that he took about 10 minutes to bring me a menu, despite a pretty empty house at midday.
I wasn’t really there to drink that cappuccino – I had come to observe and talk to the waiter.
Finally, the cappuccino arrived. The waiter, as it turned out, had just finished army service, and this job suited him as he figured out schooling options. He gets paid NIS 29 an hour. Like most waiters in the country, his tips are counted toward his wage, although he gets to keep whatever exceeds NIS 29. Would his service improve if he knew he got to keep his tips? “Of course it would give you more motivation,” he said, with a charm that earned him a NIS 2 tip on a NIS 16 hafuch – even though, at that hour, he probably wouldn’t make it past NIS 29 per hour in tips.
He took my number for a more proper interview, but I never heard from him. Nor did he want to be named, but his story is the same for about 75 percent of the waiters in the country. Unlike “servers” (the more politically correct, unisex term for waiters) in the US and Europe who generally pocket their tips at the end of a shift, supplementing their wage income, Israeli servers must hand over their cash tips to their employers – who calculate the tips into their wage, allowing them to keep the excess.
Before the violence broke out in the streets of Jerusalem this month, proposed legislation regarding server income was on the docket for a reading in the Knesset this month, delayed now due to the security crisis.
Introduced by an NGO called Meltzarim Im Kavod (Waiters with Dignity), the proposed legislation would require restaurants and bars to pay their servers a wage while allowing them to keep the tips. This is how I got paid years ago when I waited tables at the long-gone Planet Hollywood in Tel Aviv, where I made some nice money. But Planet Hollywood, an American chain, was an exception.
How waitstaff gets paid affects not only the waiters but also the restaurateurs and customers. With new restaurants in Israel lasting on average about two years, could they afford to switch to this American model? Should diners bother tipping if there is no guarantee the waiter will enjoy the benefits? An informal survey on the handy resource for people, mostly new immigrants, ready to point out flaws in Israeli society – the Keep Olim in Israel Facebook group – drew mixed responses from waiters, former waiters and diners. Some said their experience as a server was “awful” and “exploitative,” while others felt they were treated well – which usually means they got free food, in addition to a decent wage.
Naftali Schriiver, an immigrant from Holland of four years who recently completed his army service, works at a kosher steakhouse on Tel Aviv’s Rothschild Boulevard.
Waiting tables suits him; as a student, it affords him flexible hours, and during tourist season he can make up to NIS 80 an hour. His guaranteed minimum is NIS 30. On his salary, he could rent a studio in Tel Aviv that goes for NIS 2,400.
“If you have a family and stuff, it’s very hard to be a waiter, but if you’re a student and you don’t have that many living expenses, it’s pretty good to do and I do like the job.”
On the job, he gets to meet people and brush up on his conversational Hebrew. While in Holland he would have been able to keep tips, the Dutch generally tip up to 5%, whereas in Israel the average is 9%-12%.
Newlywed Micky Jolles (whom, incidentally, I profiled as part of a feature on arrivals from Nefesh B’Nefesh) has been working as a bartender on and off since his arrival in Israel from California about six years ago. A personal trainer specializing in TRX by day, by night he’s your friendly, handsome, gregarious bartender at the Dancing Camel Brewery in Tel Aviv, founded by fellow American immigrant David Cohen.
But the American brewmaster has adopted the Israeli way of paying waiters and bartenders. Jolles’s tips cover his NIS 25/hour minimum.
“Everyone in Israel does it,” Jolles said. “It’s a big deal, and I’ve had arguments with bosses over it in the past. I realize it may change, but that’s how it is. If you don’t want to work for tips and you want to argue that he [the employer] is doing something illegal, he’ll say, ‘That’s OK, just work somewhere else.’” No law explicitly forbids restaurateurs from collecting the servers’ tips.
“We have a legal vacuum in the issue,” said Jonathan Hasidim, spokesman and co-founder of Waiters with Dignity, which was founded two years ago by student waiters and their advocates at Hadassah Academic College in Jerusalem to improve waiter working conditions.
The Supreme Court, Hasidim noted, has put out conflicting opinions on who is the rightful owner of the “service fees,” as Hasidim prefers to call them, thus giving employers leeway to argue that the fees could feasibly be considered the restaurant’s income, since they are earned on the premises.
Hasidim and Waiters with Dignity hope the law, if passed, would standardize what is actually a pretty confusing system, which leaves gray areas and open doors to exploitation not only in regard to wages but to social benefits and transportation costs.
“Many of my friends worked and work as waiters,” Hasidim recounted. “Most of them receive a very low salary with no rights – without transportation, without a pension allocation, without sick days and vacation days, and without overtime.”
Case in point: Yael Benchimol, an interviewee sourced from the Keep Olim in Israel group, left her job as a waitress at the capital’s Ramat Rachel Hotel because she didn’t realize until she received her pay stub that the hotel docked her pay for transportation and the uniform.
“In the end I wasn’t left with anything, so I couldn’t continue with them,” recalled Benchimol, an immigrant from Brazil.
She liked the work and would have stayed, had the income been adequate.
Enjoyment of the work is what keeps Jolles at his job, or what he would rather call an “experience.” “I don’t work here for the money,” he said. “I work for the atmosphere, the customers, the vibe and the beer – the best beer in Tel Aviv.”
ACCORDING TO a survey conducted by Waiters with Dignity, 83% of servers receive their minimum wage via “service fees”; 73% earn less than NIS 4,000 a month; 77% aren’t paid for overtime; and 40% aren’t aware of their rights. Hasidim believes that if the waitstaff payment system was standardized, more would choose waiting tables as a career, thus professionalizing service.
But one former waiter and restaurateur is not bothered by the current system and believes the wage justifies the nature of the work, and that changing to the model of minimum wage plus tips would actually deter prospective waiters.
Gani Medad owned and ran the now-closed Lion’s Den resto-pub in the Jerusalem city center for three years. Before that, he worked as a waiter and bartender, but few in Israel, he said, would call it a “career.”
“In Israel it’s kind of a side job,” Medad said. “It’s for a student who has a few free hours a week and they come and wait tables. They’re not really professional waiters, so you can’t really expect them to get paid as professionals.”
At his establishment, waiters and bartenders earned up to NIS 70 per hour per night shift. On slow days, tips would go toward the minimum wage, which ranged between NIS 24 and NIS 28. (Effective April 15, 2015, the minimum wage is NIS 25 an hour.) At Lion’s Den, workers received a pay stub at the end of the month for wages only, while the excess in tips, kept in a safe, was doled out at the end of the month.
It was up to the servers to report that income, another factor that could actually make this model appealing for some servers. Nowadays, however, tips are often not paid in cash, with customers increasingly having the option to include tips on the credit card.
“No one is going to work for a minimum wage,” Medad asserted. “And as it is, people don’t look at it as a profession.”
But some establishments choose to go by the American model, whether out of practical necessity or principle, and they’re rewarded with a certificate by Waiters with Dignity. Casino de Paris, established on the premises of a former British hotel and bar of the same name inside Mahaneh Yehuda in Jerusalem, proudly displays the certificate.
I wondered: If I sat there on Wednesday afternoon, would the enticement of keeping the tips improve service? Exactly a week after visiting Roladin, I sat myself down with my laptop in Casino de Paris’s charming, Jerusalem-stone-lined courtyard. I was the lone customer, but in all fairness, the five-year-old popular hangout comes alive at night. The menu came right away from a man in his 30s or 40s – and certainly not the student type. As I needed an electrical outlet, he quickly helped me switch tables. Then came the 10-minute wait for my order to be taken as he chatted with other customer-friends.
After my grapefruit juice was delivered, the “waiter” explained that during nonpeak daytime hours, he serves as an all-purpose employee, preparing the place for the busy night. Clearly, he wasn’t going to make his wages in tips that hour.
According the manager, Yaara Mizrahi, the decision to go by the wage-plus-tips model was her father’s, whom she describes as a nonconformist businessman who has been in the restaurant business for many years. It goes with the ethos of treating employees well, and she believes it motivates better service as well as a clearer payment method.
“It relieves the pressure,” Mizrahi said.
According to Hasidim, some small eateries prefer the wages+tips model since it frees them from having to make the complex calculations for income-tax reporting.
Concerned equally with employer rights, Mizrahi believes, on the flip side, that employers are at risk of being exploited by employees. She’s concerned that employees exploit labor laws to sue former employers for severance pay even after being let go for poor performance.
She has never faced a lawsuit but has heard of businesses that stumbled after being slapped with a judgment for thousands of shekels.
Down an alleyway from Casino de Paris are Shuka and Arbes, two establishments that also voluntarily operate with the wages-plus-tips model. The owner, Dotan Ben Haim, opened Shuka at age 25 and felt uncomfortable paying employees at a new establishment only via tips, so he offered the minimum wage plus tips.
“It didn’t seem fair,” Ben Haim said. “So we decided to pay wages plus tips, and it was a difficult decision, especially for a new business. You need every cent that comes in. I took a hit in my salary, but it allowed me to hire the people I wanted.”
In addition, this model fostered loyalty. His employees have been with him since day one: “It turns them into partners.”
Today, wages along with tips could reach up to NIS 50 to NIS 80 per hour per shift; although once social benefits are factored in, he pays out about NIS 29 an hour.
But he didn’t apply this model going into his second joint, Arbes, a hummus eatery, because he realized the expenses of starting a business were just too great.
Only once business proved successful did Ben Haim implement the wages-plus-tips model there, too. He is now a proud employer of students throughout the city.
The uncertainty over what waiters earn and where tips go has created confusion among customers, some of whom would rather not tip at all.
Simone Katz of Jerusalem recalled a conversation with a city waitress who admitted to keeping the excess tips in cash, enjoying the benefit of not having to report them.
“I think tips in general are something that should be done away with,” Katz maintained. “I’m typically a generous tipper, but the situation leaves me uncomfortable knowing that the system is set up to encourage the waitstaff to avoid paying their fair share of taxes.”
She cited a Time magazine article about restaurants in the US voluntarily abolishing the tipping practice entirely, and instead raising prices or including a service fee.
“I have a big problem with tips in restaurants; I am often in a quandary,” Howard Glick replied on Keep Olim in Israel. “I am aware that often the tips get shared evenly among all waitstaff, even if I am tipping a particular person for their work. However, sometimes I am told that the waitstaff can’t keep the tips and it goes into the pockets of the restaurant owners. This often makes me loath to tip.”
Katz offers an idea that may take care of the problems on all ends: “Let’s start a no-tipping revolution!” And while we’re on the topic of starting a revolution, let’s consider tipping other professions as well.
So if you feel you’ve benefited from this article, tips are welcome.