Kevin Reddy: No-Tip Policy Works For Restuarant

It is considered very rude to not tip a server at a restaurant. However, according to the CEO of Noodles & Co., Kevin Reddy, it isn’t a problem because of a “no-tip policy”.

According to News Max, the restaurant, Noodles & Co., mostly pays workers above minimum wage. Since pay is generally higher than the average, the option of a tip is not in place. As a matter of fact, there is a “no-tip policy” in place at Noodles & Co.’s locations in 27 states and Washington D.C. An average meal at the restaurant is about $8, more than fast-food competitors like McDonald’s, but less than full-serve restaurants like Olive Garden or Red Lobster, where it is both courtesy and social necessity to tip servers.

Also, Kevin Reddy made a statement on why there is a no-tip policy, besides the higher pay, when he said:

“Respect doesn’t cost you a thing.”

“We don’t want our guests to feel we’re trying to upsell them. We’d rather have them feel we’d rather upserve them than upsell them. That’s why we’re really cautious even about the price increases we pass on.”

Reddy also believes his no-tip policy will continue to benefit Noodles & Co., which he grew to its 380 from 284 back in 2006 after leaving Chipotle Mexican Grill Inc. and McDonald’s Corp. He stated on Market Watch:

You can get in and out of our restaurants for 25 percent less than a Chili’s or an Applebee’s. Our prices are lower to begin with, and you don’t have to put a 15% to 20% tip on it.

There is also another positive that comes indirectly with the no-tip policy. In recent months, as reported by MSN Money, President Barack Obama boosted the minimum pay for federal contractors hired in the future to $10.10 per hour. He’s also voiced his support for the federal level for all workers to rise to $10.10 from the current $7.25. Also, there have been protests that minimum wage should be $15 per hour.

Noodles & Co. does not have this issue. Kevin Reddy says in order for employees to be satisfied with the no-tip policy, the company has to pay its workers enough to offset the fact they don’t receive tips. This however doesn’t stop patrons of Noodles & Co. from tipping, in which employees will then graciously accept them.

Maybe Kevin Reddy’s policies need to be taken seriously among the full-server restaurants, which are struggling to stay alive in this current economy. As reported earlier by The Inquisitr, Olive Garden introduced a new three-course meal deal in hopes of getting in more customers. They even went as far as updating their classic logo.

In the end, Kevin Reddy said it comes down to hiring genuinely nice people, rather than those motivated by tips to be nice.

Either you enjoy people, and you treat them right, or you don’t. You’re either genuine, truthful and nice, or you’re not. If you would throw somebody under the bus to get ahead, nobody wants to work with you. You’re not going to make it in our culture.

With Noodles & Co. being one of the companies dominating the restaurant hospitality department, along with Panera Bread Company, Kevin Reddy may be on to something.