Tipping Policy and Fair Wages

Where We Started

In January 2024, Butternut Bakehouse transitioned away from accepting credit card tips to an administrative fee of 12% applied to all transactions. The revenue from this fee was designed to be used exclusively for employee wages and benefits. After making this transition, wages were adjusted so that all hourly staff would earn a flat rate equal to or greater than their previous tipped wage.

Why Leave Tips Behind?

Unfortunately, Massachusetts State law is very restrictive regarding tip distribution to waitstaff in food service businesses. While the law’s intention may be to protect employees, some workers benefit while others are disadvantaged. Tips can only be distributed to waitstaff without any supervisory roles who directly serve patrons or clear tables. This means that kitchen and dishwashing staff who work hard to prepare our products and clean our space cannot receive tips, and counter staff who do any supervisory work (training, scheduling, etc) during the day are not allowed to receive tips. For a small café without table service, these restrictions and their relationship to tipping culture prevent us from compensating our full team for their important contributions to our customers’ experience.

Additionally, and perhaps more importantly, removing tips from the equation gives all of our employees a reliable, livable wage that is not subject to the ebbs and flows of daily sales.

Our Next Step

As of July 2024, we have officially built the 12% administrative fee into the price of all of our items! Throughout the past six months, we’ve worked with both customers and employees to navigate this new policy and figure out the best system for our Butternut community. Thanks to these conversations, we’ve moved onto the next step of our move away from tipping, and updated our prices to include the 12% difference. This way, the list price of our pastries and drinks is the same as the final price our customers pay at the register. The final price will remain the same as it would have before this adjustment (with some items actually being less expensive) and at least 12% of the final bill continues to go directly to employee wages and benefits.

Thank you to our Butternut community for your support and your collaborative spirit, and for coming on this journey with us! As always, we are excited to see what the future brings :-)

For any questions, don’t hesitate to contact us at info@butternutbakehouse.com!