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Cash only gratuity allowed ... you may NOT charge the TIP to your CC.

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Why is this even a practice at certain restaurants? Cash only tip??
Certainly it's one more reason to always carry ca$h on your person, but come on now. I'm especially thankful that none of us had to scurry off to a nearby ATM to get cash. So, fellow posters (and waitstaff included) ... please chime in explaining WHY such a practice even exists. TIA.

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  1. When I waited tables in college and grad school, from diner to pretty high-end, cash tips were much preferred. Most simply by the waitstaff, of course, because it was immediate, and you knew what you were taking home. Different cards, different managers, different policies meant sometimes I didn't receive the cash from card tips until the end of the week, they were very often inaccurate, but hard to prove. Like, I had somewhat of a running total, I saw all the slips, but after 3-4 days, when I got the cash, I was Pretty certain I should have $150. But when I was given $110, the manager just shrugged it off. I just never know the situation of anyplace for sure, so always try to tip in cash, and servers almost always express their appreciation.

    5 Replies
    1. re: tracytrace

      One restaurant in Scottsdale, AZ (just search CH, and you will figure it out) keeps 100% of the tips for themselves - the servers get zilch.

      Hunt

      1. re: Bill Hunt

        if management is stealing tips, they would not have a policy for cash-only gratuities.

        1. re: hotoynoodle

          Their policy seems to be that any tip is theirs, and the servers are SOL. Now, I have only seen the news featurettes on them, plus the Gordon Ramsay episode, so cannot comment on exactly what it is, that they do.

          Hunt

          1. re: Bill Hunt

            i don't have a tv and certainly wouldn't watch gordon ramsay if i did, lol. (have had enough celebrity chefs screaming at me, tyvm.) if this is coomon knowledge, where is the attorney general or labor court?

            again, if the owners are openly pilfering, they wouldn't demand cash only tips, which the waiters will keep.

            1. re: hotoynoodle

              Perhaps a few of these threads will answer your questions:
              https://www.google.com/search?q=amy&#...

              Happy reading,

              Hunt

    2. It can work for or against servers. PRO - I once cashiered in a private club. At the end of the evening, I paid out the tips in cash. The always got the exact amount that had been paid. I guess I mistakenly assumed all restaurants did the same thing. CON - if the guest has no cash, the server gets... nothing? They rely on those tips to pay their bills. That policy is terrible. If I was a server I wouldn't work for any place that does it!

      3 Replies
      1. re: sassNall

        I can definitely see why cash only tips is a restaurant practice, but as you highlight it really can be a huge CON if the customer has no cash which I often do not. Of course I probably should, but rarely do.

        1. re: sassNall

          One problem is that if the servers get the full amount of the cash tip, the restaurant is eating the fees the credit card company will take off that portion of the bill.

          I would prefer to leave tips in cash, but it's just so darn convenient to put it on the card with the rest of the bill, plus you don't have to explain why you sent a credit card slip back with the tip line crossed out!

          1. re: Ruth Lafler

            Instead of the line, I always write cash in the spot where the tip would go on the cc slip in this situation. :)

        2. with a cash-only tip, only one thing can go wrong.
          with a credit cart tip a million things can go wrong.
          take a couple of minutes to figure it out.. . .
          often, i'll go one better, only leaving cash IN THE HAND of the server

          1 Reply
          1. re: westsidegal

            Exactly. Especially when I've been with, er, troublesome company, I will hand the tip to the server personally with my thanks. And, if necessary, apologies.

          2. This is a bad move. It's one thing if you know you're going to a cash-only establishment, but this is a hybrid of sorts which probably leads to shorts. I feel like a douche when I order coffee in the morning, reach in my pocket to see that I spent all my cash the night before and can't tip the barista.

            1 Reply
            1. re: evenworse

              I gotta agree. I've never run into this and it makes no sense. It seems you're setting the customer up to be caught short.

            2. I can't speak to the other aspects, but I can say WHY:

              CCs take a 2-3% cut of all transactions, and automatically get added on to whatever accounting the business does. So as a business owner, you have to decide to tip the servers as intended (the ethical route), thereby essentially paying them an extra 2-3% off each table out of your own pocket, or skim off the tips to save yourself this service charge. It also automatically registers as payments to your business, which you then pay out, but I imagine it affects your total income, which affects your taxes come April. Cash keeps everything even steven and under the table.

              10 Replies
              1. re: thursday

                " It also automatically registers as payments to your business, which you then pay out, but I imagine it affects your total income, which affects your taxes come April.

                ~~

                tips are not considered "income" for the restaurant owner, but do factor into what is paid in unemployment taxes and such.

                in many states, it's actually legal for the owner to take that processing fee from the servers before paying their tips. even while paying them far less than minimum wage.

                IT'S A COST OF DOING BUSINESS.

                raise the price of soda a nickel and stop being an a**hole tightwad.

                and yes, i have worked for owners who have done this.

                most times i leave cash when practicable, but have yet to encounter a place that takes cards and yet demands cash tips. am quite sure that's illegal.

                1. re: hotoynoodle

                  "but have yet to encounter a place that takes cards and yet demands cash tips. am quite sure that's illegal."
                  .
                  Laws vary by jurisdiction...........................that said. in many US jurisdictions a merchant may set the rules for what may be paid for via credit card and what may not, or even have an upcharge for using the credit card.
                  Example: here in Connecticut it is perfectly legal for a gasoline station to have one price posted for cash and a higher price posted for credit. In a coin shop, collectibles can traditionally be paid by credit card, while bullion purchases may not unless an additional percentage is paid. Yesterday I had a manicure/pedicure and it was posted that no tips on credit cards.
                  As long as the restaurant posts/notifies in advance of taking your order that no tipping in credit cards is permitted, it would be legal.

                  BUT>>>This action might violate the merchant agreement with the credit card company, but still be legal.

                  Disclaimer: I am an attorney, but am not offering legal advice, merely commenting in the situation in my own jurisdiction.

                  1. re: bagelman01

                    my understanding is there was a compromise made with gas station owner types about the differential in cash vs. credit payments since their margins are so slim.

                    and yes, i still see signs that say "no cc purchases less than $10", but here in mass. that violates the contract both with credit card issuer and their bank for mc and visa. amex does allow minimums, but only if applied to ALL cards the retailer accepts. double whammy. those signs are mostly in mom & pops where i pay cash anyway. (i realize federal law is different.)

                    1. re: hotoynoodle

                      My understanding is that the credit card companies used to have contracts that prohibited minimum credit card charges but that such a stipulation is now illegal under the Durbin Amendment. Instead, merchants can set minimums up to a limit decided by the Federal Reserve, currently $10.

                      1. re: hotoynoodle

                        Hoytoynoodle,
                        I don't ususally discuss law outside of my jurisdiction (Connecticut), but as I went to law school in Mass and passed the bar exam there, I'll do so.

                        Just because a merchant does something which violates the contract with either or both the credit card issuer or the bank, doesn't make it illegal. The credit card issuer and bank have means of redress. They can cancel the merchant account, they can sue in civil court for breach of contract.

                        If the merchant's action was truly illegal, then the Commonwealth would be in position to prosecute, but that's not the case you describe. Mass. has very strong consumer protection laws M.G. L. chapter 93A, though some of Connecticut's consumer protection laws are better for the consumer, but I'm biased <VBG>.

                        1. re: bagelman01

                          blah, i get hung on legalese. i am not trying to play a lawyer on the interwebz.

                          bm: i know the federal law changed as mentioned by nocharge, but can state law supercede that?

                          1. re: hotoynoodle

                            In this case the federal law trumps the state laws. Congress has reserved most banking regulations tto the federel government. Chances are the Card issuer and clearing bank are not in the same state as the restaurant and when all else fails the feds will find this falls under the commerce clause of the constitution...............

                            Basic rule of thumb. A state may grant more liberties than the federal government, but not less.

                            Example here in New England: Mass and Connecticut have Equal Righta Amendments to their state constitutions. It failed nationally decades ago. and we have gay marriage, a liberty not yet granted by the feds.

                    2. re: hotoynoodle

                      I've never seen this at a restaurant, but every hair salon I have ever been to in Massachusetts has this policy. You can put the payment for services on your CC, but if you want to tip, it has to be cash.

                      When I once asked what the reason for the policy was, I was told that the salon's auditor recommended it. Seems kind of fishy to me, but I wouldn't stiff a stylist (or a server) because of it.

                      1. re: Isolda

                        I just ran into that in a nail salon on a visit to Pennsylvania. They reluctantly allowed me to put the tip on my bill since I was short on cash, but their posted policy was cash tips only. It may be that it makes accounting for a small business like that much easier.

                    3. re: thursday

                      In California it's illegal for the restaurant to deduct CC costs from the employees' tips. I've never been to a place that won't let you charge the tip, but I can see why one might not. Just seems really stingy on the part of the owner, and an inconvenience to guests.

                    4. Let's not forget that as a side effect it also allows wait staff to under report more easily on taxes.

                      11 Replies
                      1. re: PommeDeGuerre

                        Cheating on taxes for cash payments? I cannot imagine that ever happening...

                        Hunt

                        1. re: Bill Hunt

                          those of us with a libertairian bent wouldn't view that as anything negative. . . .

                          1. re: westsidegal

                            In all my years I have never even considered giving a gratuity to out local librarian. Is this a European trend?

                            1. re: Motosport

                              libertarian,
                              not
                              librarian

                              1. re: westsidegal

                                but would you give a tip to "out" somebody? ;P

                                1. re: westsidegal

                                  I knew that!!! My twisted sense of humor is charming.

                              2. re: westsidegal

                                Yeah, I have to say that's a plus for me. Servers get screwed over enough that I don't mind if they choose to under-report the cash tip I leave them!

                                1. re: Ruth Lafler

                                  I have some friends that feel "sophisticated" because they leave their tip in cash eschewing possible airline miles on their credit cards. I usually ask them questions about why they do so (and feel sophisticated about it):

                                  1. Is it because you want to encourage tax evasion? That would make you a proud, upstanding citizen, wouldn't it?

                                  2. Is it because you would like to tempt someone not to tip out properly? Well, that idea should certainly make you proud.

                                  3. Is it because you would rather have that cocktail waitress spend more money on doing coke and less money on Social Security taxes possibly hurting her when she gets old? Well, that's a good deed!

                                  Whenever I dine out, which is pretty much every night, my tips are usually in the 30-100 percent range. I would never give a rat's ass about credit card charges. That's for amateurs.

                                  1. re: nocharge

                                    You're kidding........ right?

                                    1. re: Midlife

                                      Nope.

                            2. re: PommeDeGuerre

                              A wait staff cheating the IRS? Kind of what I taught my daughter to do at her first job at Pizza Hut.

                            3. This is common at hair salons. If the tip is in cash, they THINK they won't have to report it to the IRS/pay taxes on it. Basically they and the salon owners are tax cheats.

                              18 Replies
                              1. re: Just Visiting

                                For several years I've been paying everyone; hair salons, nails salons, waitstaff, estheticians, car washers, housekeepers....everyone gets tips in cash from me and I have my reasons for doing so.
                                Once it leaves my hands I'd hope they declare it but I have no idea if they do.
                                However, if an establishment gave me no other choice but to tip in cash?
                                I'm not sure how I'd handle that.

                                1. re: Just Visiting

                                  The only place I ever go to that doesn't accept tips on a cc is pretty much every nail salon I've ever been to. My hair salon does, although I've been to some in the past that don't. I never thought of the fact that they might not accept them to avoid claiming their tips on their taxes. You don't know how many times I've been at the nail salon and somebody there wasn't aware that they couldn't tip on the cc and didn't have cash, so in that case the nail technician isn't getting anything as a tip, so nothing to not claim on their taxes anyways.

                                  1. re: SaraAshley

                                    Two of the United Airlines Red Carpet Clubs do NOT allow for tips on CC's - both are at IAD, but there might be more?

                                    I always try to have a few $'s in cash, just for the times that I travel through IAD.

                                    Hunt

                                    1. re: Bill Hunt

                                      Two of the United Airlines Red Carpet Clubs do NOT allow for tips on CC's

                                      ~~~

                                      might this be to discourage tipping? to make service seem "fair"?

                                      1. re: hotoynoodle

                                        Not sure of the reason, but all other RCC's, that I have visited, have allowed CC tips to be recorded - just no the two (main ones) at IAD. Maybe something odd in VA (where IAD-Dulles is located)?"

                                        I have never seen any statement on this disparity. PHX, LAX, SFO, SEA, ORD, IAH, JFK, DEN, HNL and EWR allow for CC tipping. Not sure about others, as we do not fly to those cities, and some, like OMA, MSY and TYS do not have RCC's. Most UAL International FC clubs do not charge for anything, so I have never needed to even look, such as FCO, LHR, PVG, SYD, NRT and CDG. Often, those clubs are shared, so are not really what were called Red Carpet Clubs, and now United Clubs.

                                        Maybe someone else can "fill in the blanks?"

                                        Hunt

                                      2. re: Bill Hunt

                                        I actually work in event planning and do most of my travel flying out of IAD. I fly United a lot as my company seems to prefer it, but it isn't required. I much prefer Virgin and try to get a flight with them when I can. I'm still not at "red carpet level" yet with my miles with United though, so I haven't ran into this. I'll keep this in mind though for the future! :) I'm sure being red carpet level makes flying on United a lot more tolerable!

                                        1. re: SaraAshley

                                          That is the only UAL "hub," with a couple of RCC's, where this no tipping on a CC has been noticed - both of the main RCC's, and for International First, there are no charges, so it's moot. There, I usually leave a US $ 5, if the busser has done a good job, but as I am not charged for anything, there are no CC charges.

                                          Seems that there IS another RCC at IAD, but it's mainly for commuter traffic, and when we are doing those connections, seldom have time, or stop by one of the two larger clubs.

                                          You are also correct about the RCC membership. I bought that for my wife, who flies a bit more than I do, and as I seldom fly without her. She deserves everything that she can be awarded. Some years back, I got the UAL "Club Card" from Chase, and her RCC membership is included. It works out to be right at US $50 better in benefits, than the annual fee on that card.

                                          I could pick up a "family membership," but would have only used that twice in the last 4 years.

                                          BTW - some RCC's ARE better than others. IAD has two, and the big one (near most International gates) is better. Then, if we're flying FC, there is a great International FC Club, but everything is included, just like most UK, OZ and Euro airports (even when one is only in BC).

                                          If you fly through IAD on UAL, do treat yourself. I feel that it is worth it. Just make sure that you have a couple of $5's handy.

                                          Travel safely,

                                          Hunt

                                          1. re: Bill Hunt

                                            Thank you for all the friendly advice. I'll keep this in mind, and perhaps one day you'll run into me at the RCC lounge! :)

                                            1. re: SaraAshley

                                              I'm the "old guy" with the gray beard, a navy blazer, and a lovely younger wife - with a glass of the "Premium wine... "

                                              I worries me, when I know most of the servers at all RCC's. Same for the curbside skycaps! I think that I need to spend more time at home.

                                              See you in the "friendly skies."

                                              Hunt

                                              1. re: Bill Hunt

                                                Nice - I'll keep a look out! And your life doesn't sound half bad to me. A lovely younger wife, good wine and traveling! Plus, I've read some of your other posts. Count me envious! I do understand though that sometimes there's no place like home. It's always good to take some time to slow down. The RCC lounge isn't going anywhere, although I'm sure they'll miss you!

                                        2. re: Bill Hunt

                                          Are you saying that they don't have a tip field on the slip if you buy a premium drink that you have to pay for? I have never seen that. My experience, mainly in California, has been that you can't pay cash for premium drinks, but that slips allow you to leave a tip. They also have tip jars so that people can leave tips for complimentary drinks. I can very well believe that you can't leave a tip for a complementary drink on your credit card, although I've never tried it. Is that what you are saying or that you can't leave a tip, period, even when you are paying for the drink?

                                          1. re: nocharge

                                            I just had a situation where I work in which the customer's card would not run through our service CC machine so I had to choose whether to ask for another card or run it through our retail system, which has no tip function. I chose the latter because I didn't think it was right to inconvenience the guest (semi-regulars). The guests wrote in a tip on the retail receipt but there doesn't seem to be a way for our owners to charge the card with only the card number. Cost me $16 but I felt good about it.

                                            1. re: nocharge

                                              That is exactly what I am saying. They will also not allow one to write in a tip - the total is the total for purchases, and nothing else is allowed. IAD is the ONLY RCC location, where I have observed this, and in two, out of three RCC's. In your neck of the woods, LAX, SFO and SEA, there IS a tip line, and tips are accepted there. Why IAD is different is unknown to me.

                                              Now, I do tip at IAD, and do so in cash. That has never been an issue, but I just need to remember to bring some cash with me.

                                              As I get a discount on the "Premium Wines" with my United Club Card, I normally tip the amount of that discount, whether on my CC, or in cash.

                                              As I was one, who campaigned for over a decade, for the addition of "Premium Wines," when Continental (free "House Wines") and UAL came about, I refused to accept the free wines. I still buy the "Premium" ones (better glassware too), and pay my way.

                                              When UAL added those "Premium Wines," about 9 mos. before the merger, the concierge folk at IAD told me, "You got your wish. We just added Premium Wines. Enjoy." I did, and have, even though I am not allowed to add a tip to my CC at IAD.

                                              Hope that answered your questions, but if not, please prod me, and I will do so.

                                              Hunt

                                              1. re: Bill Hunt

                                                That clarified things, thanks! Strange policy, though.

                                                1. re: nocharge

                                                  Great. I tried to hit everything, but was afraid that I might have missed something.

                                                  I do agree with you, that it is odd, and atypical for the UAL RCC's. As far as I can tell, it is unique to IAD, but then I do not fly out of EWR that often.

                                                  Hunt

                                        3. re: Just Visiting

                                          My current stylist insists on cash only tips. It is not sitting well with me. First, she's at the higher end of regional pricing, so it's not like she's cutting hair for $10 a head, barely making minimum wage. Second, why should she get a break on taxes because of her chosen profession? Third, she suggests going to the ATM should I ever forget to bring cash. Hasn't happened yet but I think I would let her wait until my next appointment to get that tip. Obviously, I've got "one foot out the door" anyway.

                                          On the other hand, I often leave cash tips for food service. I always wonder if the server actually gets their due otherwise. But would still be offended if the restaurant demanded cash only tips.

                                          1. re: Just Visiting

                                            My hair salon just recently switched to a cash-only tip policy. Not because they don't want to pay the tax on tip but because with everyone paying with a credit card they didn't have any cash with which to tip out the stylists.

                                            1. re: dmjordan

                                              erm, easily remedied by keeping a cash back-up, which is what anyplace does that has a cash register.

                                          2. There have been occasions when we have not had cash for a tip (a restaurant allowing payment for the meal by card but not having its card machine set up to accept tips). On such occasions, we don't tip.

                                            1 Reply
                                            1. re: Harters

                                              Hi Harters... I always keep an extra $100 note in my wallet, wedged between a small photo of my wife and another small photo of my cat (its' easy to remember that spare cash is hidden inbetween the two entities on whom I spend the most $ :-) When I break the $100 dollar bill into smaller currency for an impromptu tip, I just replace it with another when I'm next at the bank or ATM...

                                            2. I have not observed this, but suppose that I will.

                                              I always add the gratuity to my credit card, and seldom carry much, if any cash. An exception would be at a fine-dining restaurant, where we will have some exceptional wines, where I might slip the sommelier a cash tip, on the side. That is not all that often.

                                              If I do encounter this, I will move on, and dine elsewhere.

                                              Hunt

                                              1. When I am traveling on business,my employer asks for a receipt including tax and tip to get reimbursed the full amount. I like the idea of leaving cash, but it isn't always practical.

                                                3 Replies
                                                1. re: susancinsf

                                                  when i expense, i have to do this as well.

                                                  1. re: hotoynoodle

                                                    That's a good point. If you're getting reimbursed based on receipts, the tips would have to come out of your own pocket.

                                                  2. re: susancinsf

                                                    Yes, same situation here. I had to tip in cash last week several times while on travel and wrote that information in on the receipt. Fortunately, my employer, a fairly small company is trusting and doesn't have a policy against this.

                                                  3. I never have much cash on me. I would be surprised and very much caught off guard and would have to run to an ATM. There have been a few places where a sign is posted as you walk in the door. I turn around and leave. If it was not brought up until I finished my meal, I would be royally pissed off.

                                                    1. No comment on why - but in Israel this is standard. It is very uncommon that a restaurant will allow tips on credit cards. The most expensive restaurants are more likely to allow it, but it's very uncommon.

                                                      1 Reply
                                                      1. re: cresyd

                                                        I ran into this in Italy, too. No way to add a gratuity to a credit card bill.

                                                      2. The move to eCash cards and stored value cards may make the interesting.

                                                        I live in a country where the only place I need to use cash is for a taxi. Everything else, and I mean everything is paid by card, often an eCash swipe card - coffee, sandwiches, small grocery purchases etc etc. it does make cash tipping difficult as we rarely have much cash with us. It's amazing how quickly you get used to it and find it weird to use real money.

                                                        1 Reply
                                                        1. re: PhilD

                                                          Interesting point. I overheard two SB "baristas" say that corporate has been slowly increasing prices on food and coffee related products due to the huge popularity of the SB app and gold card. I guess even though their employees make a living wage (debatable) the increase in the use of the app/card has greatly reduced tipping. Increased prices=increased profits and the ability to counter loss of tips.

                                                        2. Well, then you won't be getting much of a tip, since I never carry more than about five bucks cash... I know cash tips are generally preferred because the staff gets it on the spot and doesn't have to wait, and nobody has to sit there and try to add up the 'digital' tips and figure out where they have to go, but using a card is a lot more convenient for us. One of the diners we go to regularly, when you add the tip to your check they take the cash out of the register and hand it to the waiter on the spot, that seems like the fairest way to do it to me!

                                                          1 Reply
                                                          1. re: Kajikit

                                                            unless there turns out to be an error on the bill, either made by the server, or in adding the tip to total by the guest. that will involve chasing the server down and getting back the difference.

                                                            the "digital" tips are added by the pos system and a closing report is printed at end of shift. other than waiting for the manager/bartender/whomever to get to you, it's zero hassle to get paid out this way. also makes it less likely that errors are made from the till, if one payment, rather than several, or even dozens in high-volume joints, is made.

                                                          2. The reason is fairly simple:
                                                            At the end of the day here may not be enough cash to pay out the tips to the staff. There may not be any cash left over for the "house."
                                                            You'll see this practice in smaller restaurants where there is not a large "business" clientele on expense accounts.
                                                            In this day and age most people do not carry much cash. I see people using debit cards at Dunkin' for a cup of "Joe."
                                                            Cash is king! Servers and proprietors love cash. What "Big brother" does not know!!!!!!!!
                                                            Personally, I find it is a turn off and if I don't have cash I insist that they add it to the CC bill. They always do.

                                                            25 Replies
                                                            1. re: Motosport

                                                              >>"The reason is fairly simple:
                                                              At the end of the day here may not be enough cash to pay out the tips to the staff. There may not be any cash left over for the "house.""<<

                                                              Interesting thought, and certainly possible in some cases, but may be a limited explanation. In California, for example, the 'house' has until the next regular pay day to get the tip money to the staff. No need to do it the same day, though I'm sure small places would find it easier.

                                                              I'm still backing the credit card processing and handling fees as the main reason.

                                                              1. re: Midlife

                                                                .........and where will the cash come from on the next day????

                                                                1. re: Motosport

                                                                  Presumably, in Midlife's California example, the cash comes from the bank, along with the cash that's going to be needed as it's the regular pay day. Always assuming regular pay day is a cash pay day. If not, presumably the tips are paid along with whatever non-cash method the employer is using to pay staff.

                                                                  1. re: Harters

                                                                    As a business owner (non restaurant) I don't see that happening.
                                                                    Restaurants will compensate the staff for gratuities by check on payday. Income tax may or may not be deducted.

                                                                    1. re: Motosport

                                                                      as a non-restaurant owner, perhaps you don't realize that not everyplace pays gratuities out via paycheck. many still pay tips out at end of shift. the bar, or cashier, has to have a till with money in the register, for guests who actually do pay with cash. and most places will have a safe of some sort in the office.

                                                                      if places ARE paying gratuities out via paycheck, then yes, all taxes and fica and such are deducted.

                                                                      1. re: hotoynoodle

                                                                        "the bar, or cashier, has to have a till with money in the register, for guests who actually do pay with cash."
                                                                        The point is that at the end of the day the cash in the till/safe will not be enough to pay the staff for their tips.
                                                                        I don't run a restaurant and I don't play a restaurant owner on TV but I am very familiar with the operation of restaurants.
                                                                        Many suppliers and purveyors insist on getting cash payments from restaurants.
                                                                        There is no requirement for tips to be paid out in cash or on a daily basis.

                                                                        1. re: Motosport

                                                                          If a restaurant owner is on a 'cash' basis with a supplier it is because the restaurant has both fallen behind on its account and BOUNCED checks to the supplier.
                                                                          If I worked for a restaurant that is on a cash basis with its suppliers (and it happened way back when I was in college) you can be sure that I'd be demanding my tips in cash every shift and be searching for a new job. That restaurant is on its way out.
                                                                          This is NOT the same as the restaurant getting a discount for cash.

                                                                          1. re: bagelman01

                                                                            Yes, a discount for cash is common. Many new restaurants are on a cash only basis because they don't have a track record. Some oddball suppliers of let's say organic asparagus may be flying way under the radar and insist on cash.
                                                                            Then, as you say, there are those that are on the edge financially.

                                                                            1. re: Motosport

                                                                              A new restaurant without a track record...read creditworthy, may be on a pay on delivery basis, but suppliers would usually accept checks until burned. In fact many suppliers won't accept cash due to the high risk of delivery personnel being robbed. Ever notice the stickers on delivery trucks? NO CASH ON BOARD

                                                                              1. re: bagelman01

                                                                                In my experience cash is king in the restaurant supply business and in most businesses.
                                                                                In our retail business we can pay by check, credit card or get a discount for paying cash.
                                                                                One restaurant in Manhattan (Benjamin) gives a 10% discount for paying your bill with cash. Nice deal!!

                                                                  2. re: Motosport

                                                                    >>".........and where will the cash come from on the next day????"<<

                                                                    Not sure I understand the question. Why would the owner be limited to paying employees their tips from the cash in the cash drawer at the restaurant? The charge card proceeds go into their bank account, from which they should be able to withdraw cash.............. or pay by check if they wish. At least that's how it works in every experience I've had with this.

                                                                    I'm sure employees would prefer being cashed out for their tips the same day, but that's not always possible or the best practice for the employer.

                                                                    1. re: Midlife

                                                                      Sometimes what employees "would prefer" is not the best thing for the restaurant.
                                                                      Personally, I don't see the employer going to the bank every day to make cash withdrawals to pay tips in cash.
                                                                      Credit card receipts may take more than 24 hours to post to the restaurant bank account.
                                                                      Do you think the staff at Per Se get daily cash for tips?

                                                                      1. re: Motosport

                                                                        I think we're not understanding each other. My post just made the same point you seem to be using to dispute what I'm saying. I'm only trying to explain where the cash could be obtained. No, I don't think Per Se pays in cash daily, and I didn't say that, but whether they do or not is really irrelevant to this duscussion Kinda confused here.

                                                                        1. re: Midlife

                                                                          My point is that it is unlikely, in the real world, that the restaurant owner would go to the bank to withdraw cash so that servers could be paid on a daily basis.
                                                                          Smaller less expensive restaurants that have fewer business clients are more likely to have more cash paying clients. Higher end restaurants are more likely to have clients use credit cards with very few cash paying clients.
                                                                          If you are still confused ask someone in the restaurant business.

                                                                        2. re: Motosport

                                                                          "Personally, I don't see the employer going to the bank every day to make cash withdrawals to pay tips in cash. "

                                                                          ~~~~~~~~~~~~~~~~~

                                                                          but they do. if house policy is to pay out at end of shift, than the cash must be given within 24 hours. trust me, there is no creature on the planet more whiny than a server not getting his/her cash at end of shift because the house is short. if it's friday? the manager will go to the bank and make a withdrawal sufficient to pay everybody out through monday. they will also make sure to have enough smaller bills, coins, etc for the cash drawer.

                                                                          as for new places? wholesalers will set them up with a line of credit and they will have 30 days to pay, often with a discount if paid within 10 days. purveyors don't want drivers handling cash and do want a paper trail. c.o.d. only happens when places fail to pay in a timely way. your asparagus farmer will get paid out of the till or the safe.

                                                                          because something doesn't seem practicable to you doesn't mean it doesn't happen.

                                                                          the staff at per se do not work for tips, btw, and get paid via paychecks.

                                                                          1. re: hotoynoodle

                                                                            "trust me" I cringe when my salesperson says that!!
                                                                            As I said before: it is unlikely that a restaurant owner will run to the bank and make a cash withdrawal against credit card receipts that have yet to be posted to his account so that servers can get their tips in cash. Ask a restaurant owner. Make sure they know you are not from the IRS.

                                                                            Find me a purveyor who does not want cash!! Ain't gonna happen!!

                                                                            The staff at Per Se do not work for tips????????? Dinner for four @ $1000 + is a $200+ gratuity!! Who gets it?
                                                                            Of course they get paid by check. That's my point!

                                                                            1. re: Motosport

                                                                              I thought Per Se added a service charge in lieu of tipping and that is pooled among the staff as party of their salary. Could be wrong as I have only been to CA twice and was never able to get in.

                                                                              1. re: Motosport

                                                                                "trust me"...

                                                                                as somebody who has worked over 20 years as a server, bartender, sommelier and manager going to the bank daily, for deposits AND CASH, is a normal piece of business for anyplace not on a paycheck system. they're not withdrawing against today's deposited cc's, but those already made.

                                                                                the exception would be larger corporate outfits who may deal with a service like brink's who pick up and drop off. that still is a daily transaction, mon-fri.

                                                                                frankly, i don't care that you think it's unlikely -- it happens to be reality.

                                                                                not that it's germane here, but per se (and sister french laundry) have abolished tipping and instituted a mandatory service charge that management distributes as they see fit, to both back and foh, as a gesture to making employee incomes more equitable. how much actually gets to whom i have no idea, but all staff receive paychecks -- no cash.

                                                                                1. re: hotoynoodle

                                                                                  So Per Se has gone the European route. I like that!!
                                                                                  Let's change the name to EMP or Nougatine, do you think the staff gets paid in cash daily?

                                                                                  Since this debate began I've been polling local restaurants and they all agree with me. Normakl reaction: "Take cash out of the bank account to pay people? Are you nuts?"

                                                                                  1. re: Motosport

                                                                                    how do they pay out tips? paychecks? or fairy dust?

                                                                                    but really, lol, ok, feel free to discount the hundreds, if not thousands, of trips i have made to various banks over the years for just such a purpose for numerous employers. as well as decades of leaving my shifts with cash in hand.

                                                                                    1. re: hotoynoodle

                                                                                      Some low end places pay out tips in cash because they have enough at the end of the day. The higher end places issue weekly checks.

                                                                                      No offense intended or taken. Our experiences are very different.

                                                                                      "Fairy dust!" I'll have to ask the line cooks.

                                                                                      1. re: Motosport

                                                                                        i have never worked in a "low-end place." have worked for 3 james beard award-winning chefs all of whom paid out tips in cash and nightly check averages were $100+pp.

                                                                                    2. re: Motosport

                                                                                      What debate? I ran my own WineBar and now work at one that pays out tips in cash a few days after they're charged to CCs. Most of the time there's enough cash from the daily receipts for that, but the owner does go to the bank sometimes for tip cash as well as bills and coin for the store's 'bank' of reserve cash. You obviously have another perspective, but didn't seem to be open to the alternative.

                                                                                      1. re: Midlife

                                                                                        Open minded am I.
                                                                                        As I said "Our experiences are very different."

                                                                                        1. re: Motosport

                                                                                          Didn't seem to be......... Obi-Wan. ;o]]]

                                                                    2. So the waitstaff can cheat on their taxes while bitching about not getting paid enough.

                                                                      1. I've never been in a restaurant with that policy. If there is no mention of a cash only tip policy on the restaurant's website and/or the front window then I'd refuse to pay the tip. Sorry to the wait staff but policies like that need to be made public. Oh and don't point me at one of those ripoff white cash ATMs.

                                                                        On a similar tangent, restaurants that are cash only or cash+debit only need to put that on their website and in the window. I've been burned once by a cash only place that indicated nothing of the sort and had to trudge off to one of my bank branches to get cash. Never again.

                                                                        8 Replies
                                                                        1. re: lister

                                                                          Ummmmm....... "White" cash ATM?????

                                                                          1. re: Midlife

                                                                            Geez. Really? Your first thought is *THAT*? *rolleyes*

                                                                            Non bank ATMs. They're usually coloured white at least here in Toronto. You pay an extra fee beyond the normal extra fee of using a different ATM than your bank. Sometimes they're sneakily even owned by a bank. I refuse to use them.

                                                                            1. re: lister

                                                                              That must be a Canadian term. Here (in the US), you pay a fee anytime you use an ATM not affiliated with your own bank. There are a few rare exceptions but its definitely the norm. I'm lucky to have a bank that refunds ATM fees. Um yeah, that term seemed inexplicably racist though. Your explanation makes complete sense though :)

                                                                              1. re: Hobbert

                                                                                The full term is 'white label' ATM, meaning not affiliated with a bank. Often you find them in corner stores. And they can have relatively huge fees for use.

                                                                                My bank doesn't charge me any extra to use ATM's that aren't theirs (well, it's included in my package fee), but the bank/company that owns the ATM will charge another fee, which I do have to pay. Bank owned ATMs usually change about $1.50, but the white label ATMs might change a few bucks.

                                                                                1. re: Sooeygun

                                                                                  >>"The full term is 'white label' ATM, meaning not affiliated with a bank."<<

                                                                                  OK, now I get it. In truth, the racial overtone did occur to me (mostly as a concern that I'd be misunderstood), but that wasn't at all what I was questioning. Where I live we have very, very few non-affilliated ATMs and those I do see are not typically painted white.

                                                                                  I guess I shouldn't have commented on the term, but it was so foreign to me that I wanted to understand. Is it a Canadian thing? In the US I think almost all people would say something like private, generic, or not refer to it with any descriptor at all.

                                                                                  1. re: Midlife

                                                                                    I don't know about the rest of Canada but they're frequently that colour in Southern Ontario, particularly Toronto. Anyone I know simply refers to them as what I called them, white ATMs. It is kind of sad that it would seem that many Americans would immediately think of race when referring to an object's colour.

                                                                                    Another reason why I don't like those "private" (remember I mentioned that sometimes banks own these too) is because they're easier to hack for nefarious purposes. Beyond the additional cost, I simply don't trust using them.

                                                                                    Anyways, I really hope the cash only tip trend does not make it's way here. I really prefer paying with my credit card as it keeps most of my spending records centralized and I get CC rewards. I sympathize with the servers (I personally know a few) with wanting cash (though not sympathize with any tax evasion) but ultimately I'm the customer and I'd like to pay the way I like to pay. I tend not to go to cash only restaurants.

                                                                                    1. re: lister

                                                                                      Just to assuage your concern, I really don't think there IS a 'cash tip only' trend here. Just some places that require that.

                                                                          2. re: lister

                                                                            my local cash-only places do not host their own websites. many are run by recent immigrants and others are super-old-school. even though they ALL have prominent signage indicating the policy, i have still seen people claim they didn't know and make a scene about needing/not having cash when the bill gets dropped. people can be oblivious.

                                                                          3. I realize I'm reviving an old thread here but I believe I have the reason. Restaurant owners pay a percentage fee to process every credit card transaction. And they don't get rates as good as Walmart or Target because of volume etc. I have never had an owner implement a cash only tip policy but I have definitely heard them complain about what it was costing them to pay us our tips. The restaurant I'm thinking of at the moment was paying about 3% on every credit card transaction.

                                                                            1 Reply
                                                                            1. re: randomnumbers42

                                                                              Before reviving an old thread and posting you might want to read the posts.......

                                                                              Way back on August 25th Thursday posted that the credit crd comapnaies take 2-3% of the transaction as a fee