The “Tip-Out System” is a very important part of restaurant service improvement for many different reasons. Tips are the basic salary for most restaurant service employees, and must be divided with utmost respect and care. The staff's reputation, morale and income depend on a proper and fair tip-out system.

There are certain factors that must be taken into consideration, before deciding on a correct and fair tip- out system. The most important concept of the system is that it must always reflect the work load and responsibilities of each staffer in a delicately balanced manner.

If this concept is strictly adhered to, then one can't go wrong in devising the most efficient tip-out system for a restaurant. It must remembered that an improper system can make or break a dining room service staff to the point where employees may deliver poor service or actually quit the job.

So, for restaurant service improvement, the following system must be applied:

A standard base system to work from is for the waiter to tip out 15% to the bussers, 10% to the runners, and 5% to the bar. Now, this is only a general guideline as the system needs to be customized according to each individual restaurant and tweaked evenly according to the workload distribution.

For example, if the runners are doing some busser work (clearing plates, replacing dining wares etc.), then another 2.5% can possibly go to the runners while subtracting 2.5% to the bussers. It all depends on the restaurant dining room service system, and on the “desired level of customer service” —so crucial for success.

One must understand that just because the bussers are being tipped out less of a percentage, doesn't necessarily mean they are not making less money overall than the runners for that shift. It all depends on how many waiters/runners/bussers are working for that shift. Less employees available for the tip-out split means more revenue for each employee.

In some of my consulting jobs for restaurant service improvement,, I have actually seen where runners made more money than the waiters on average. Surely, they worked for it running giant food plates up 2 long flights of stairs. And, the runner shift was almost as many hours long as the waiter shift. It all comes down to responsibilities and workload distribution.

There are even different types of tip-out systems that exist in the restaurant world such as the point system. For example, if $100 in tips is produced by the waiter, it gets spread out in a point system amongst all staffers. The breakdown might be $50 to the waiter, $30 to the busser, $15 to the runner, $5 to the bar, and so on. Every restaurant is an enigma, so the tip-out system must fit the restaurant's personality.

To physically perform the tip-out revenue split, the waiters can place the tip-out revenue percentages for the receiving dining room service employees into envelopes. The waiter name, date and particular shift should be included on the outside of the envelopes. Then, this split for each receiving dining room service employee can be put back together in separate envelopes with his/her name on the outside of the envelope to be distributed. The double-check system works best here to have 2 trusted people witnessing all of the money envelopes that are opened.

The dining room staff tip-out system must always be fair and balanced with very few complaints from the staff. In fact, some feedback may actually help for the understanding of the situation as the dining room service staff carries many solutions to restaurant problems. Of course, there will not always be 100% agreement amongst each and every employee.

The tip-out system really works out beautifully if done correctly using the concepts above. Again, most importantly, the balance of the restaurant service labor and responsibilities must be in proportion to the balance of all the employee tip-outs. If you follow the above system, then you definitely find restaurant service improvement.