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Restaurants Make Workers Pay 2% On Credit Card Tips

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(credit: CBS) John Lauritsen
John Lauritsen is a reporter from Montevideo, Minn. He joined WCCO-...
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MINNEAPOLIS (WCCO) – How would you like it if your employer began taking an extra 2 percent out of your pay?

Parasole, which owns 12 restaurants and bars in the Twin Cities, will now be taking 2 percent of a server’s credit card tips, according to employees.
Some employees said they received the news last week.

“For me, I guess 2 percent is just hard to imagine without having experienced it yet,” said an employee named Eric.

Eric is a server who works for one of Parasole’s Minneapolis restaurants. He is aware that 2 percent of the credit card tips he receives during his Monday night shift will go into the pockets of his employers.

“I could see where that would be problematic. Especially at higher-end restaurants where people pay with credit cards,” Eric said.

Parasole owns Chino Latino, the Uptown Cafeteria, Il Gatto, Burger Jones and other popular Twin Cities restaurants.

The news of the 2 percent plan isn’t going over so well. On Facebook, one person wrote, “If I took 2% of the company’s revenue, they would call it theft.” Another person wrote, “A service worker should not be penalized for the way a customer chooses to pay for their tab.”

Parasole would not comment on this policy or how they pay their employees.

Kip Clayton, Parasole’s vice president of marketing said, “Given the increased usage of credit and debit cards, there is a restaurant industry movement to pass all or a portion of the credit card fees, on tips only, to the tipped employee.”

It’s a philosophy that Eric actually agrees with.

“It’s nice to have a job and to work for a company that takes care of its employees, so if we have to put in a little extra effort…. that’s not a problem for me,” Eric said.

If a customer were to pay a $20 tip on their credit card, he or she would pay 40 cents.

It may not seem like much; but another server we talked with said she is making minimum wage, tips are slow, and this adds up.

Bottom line: If you want your server to get the whole tip, use cash.

Parasole isn’t alone in this. Other Twin Cities restaurant companies are taking the same approach.

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