Leroy in east London's Shoreditch has joined other restaurants in scrapping the discretionary service charge in favour of building the cost of service into the price of a meal. Emma Lake speaks to one of the co-founders
Why have you made the decision about service charge now?
This has been a time to reassess a few things. We had a few restaurants in east London bring the subject up and I felt quite quickly that it was something independent restaurants should be doing and this is the right time to do it.
In a way it is counter-intuitive because it's more tax-efficient [to operate a discretionary service charge], but there's an opportunity here to improve the perception of restaurants.
Service charge has never been understood by people – it's been part of this perception that we're out to rip people off. It devalued the service being offered and made it potentially optional. I disagree with that fundamentally. I think it's cleaner and easier to say there's one price for your meal and that includes everything.
Service charge has never been understood by people – it's been part of this perception that we're out to rip people off
Will your team see a change?
We weren't on a tronc system. I remember not so long ago working in a restaurant and having my wages fluctuate quite a lot and I didn't think that was a fair thing for our people to be subject to.
We've always paid our staff the most we can afford and that's the same in January as it is in June, which meant that throughout lockdown they got 80% of their wages, not 50%, as we've seen in some cases. That was a decision we made long before we knew what the government was going to do because it seemed morally the right thing.
It's about job security and the industry creating roles that are considered careers. If people are paid in a topsy-turvy, semi-gig-economy way, it doesn't reflect well on us as an industry.
Do you feel Covid-19 has presented an opportunity to speak frankly to consumers about this?
Hopefully everyone has had the time to reflect on the value of restaurants and it feels like the moment to make the case.
We've made great strides as a country to improve hospitality and the next step is unavoidably going to mean consumers pay more to eat at quality places. That will support not only quality staff but quality suppliers – it's a whole ecosystem that's been under threat these last few months.
In a way we're making our jobs harder, because at a time when people are likely to have less money in their pocket, we're saying that the price of your food is going to go up, not down. However, our customers have always understood our ethos and I have confidence in them and appreciate their sense, taste and morality as well.
Do you think the tide is turning now and more operators will follow suit?
I think it takes a few people to start something and it will be interesting to see if some of the larger groups do it. We're just doing what feels right for us. We're one restaurant – although we've launched a little rotisserie brand in lockdown, so that could be one and a half before too long.
I think everyone will be eating out less, so you're going to have to think about where you spend your money. It's one more little tick in the box for the place you like if they say they're doing business in a way you feel is good. It feels to me like we've removed one of the slightly dodgy bits of the industry which we didn't particularly feel comfortable with.
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