According to Merritt, the company’s research revealed that nearly 60 percent of customers expressed displeasure at the no-tipping policy, which led to an “8 percent to 10 percent” drop in customer counts. “We tried it for quite a while, tried communicating it different ways,” Merritt added.

Like Merritt, Stulman was similarly supportive of the long-term aspirations for the no-tipping movement. “While we made the determination that a gratuity-free system does not work for our business at this time, we continue to believe that it has the potential to change hospitality for the better.” He added, in comments to Eater, that customers were spending less, and explained that maintaining the gratuity-free system would have forced him to either raise menu prices further or cut worker wages, neither of which were “comfortable” courses of action.

The service-included model has existed for years in a handful of American restaurants. Its recent coalescence into a bona fide dining trend last year, however, has dovetailed with efforts to raise the minimum wage and improve working conditions.

For restaurants, moving away from gratuities is meant to offer a pay boost for back-of-house workers such as cooks, chefs, and dishwashers, some of whom are legally prohibited from receiving shares of tips. Installing service-included models also tends to produce steadier pay for servers and bartenders—a predominantly female workforce that almost always relies on tips.

Nevertheless, the service-included model is not universally popular among workers. In other evidence of growing pains, some discontent was reported in March among servers at Roman’s, a popular property in the mini-empire of the Brooklyn restaurant owner Andrew Tarlow, who followed Meyer’s lead in December by announcing that he would seek to go gratuity-free by the end of 2016. And, in San Francisco, Thad Vogler reverted back to accepting gratuity in January after experiencing high staff turnover among the formerly-tipped when he eliminated gratuity the previous year. “We couldn't compete in the market,” he told CNN. “We were faced with the options of raising prices more or bailing out.”

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