Casellula @Alphabet City ended its no-tipping policy on Sunday, just 10 months after the restaurant opened on the North Side.

It’s the first no-tipping restaurant in Pittsburgh to do an about face — maybe one of the few restaurants in the country to change back.

In the meantime, restaurants such as Dinette in East Liberty and Bar Marco in the Strip District are pushing ahead with no-tipping, even though the Bar Marco crew recently closed The Livermore in East Liberty earlier this month, which also had the no-tipping policy.

“I still believe that a system where servers are paid fair wages and food and drink prices reflect the actual cost of getting the product to the table is best for employers, servers and guests,” Casellula owner Brian Keyser wrote in an email to investors, City of Asylum folks, regulars, and others. ”Unfortunately, the unique quirks of Casellula @ Alphabet City make us the wrong test case.”

Mr. Keyser owns Casellula in Pittsburgh as well as the one in Manhattan that’s been open since 2007. The New York flagship accepts tips, in part because his servers weren’t on board with the no-tipping model, he says. “The only way it’s going to work is if there’s a complete buy-in with staff.”

The Pittsburgh location was spearheaded by R. Henry Reese, City of Asylum co-founder and president, who liked the original location so much he asked Mr. Keyser if he would be interested in opening in the former Masonic Hall in Pittsburgh.

The rise of no-tipping

The no-tipping movement gained momentum around the country two years ago, as restaurateurs such as New York’s Danny Meyer — founder of Union Square Cafe, Marta and Shake Shack, among others — pledged to eliminate tips. The practice translates to higher wages for both front- and back-of-the-house workers, along with higher per-plate prices to make up the difference.

That all workers get paid more is key, since historically, servers earn more per hour than cooks and dishwashers, even at the highest-end restaurants that require more highly skilled kitchen staff. It’s currently not legal to share tips with back-of-the-house employees.

The nationwide discussion mobilized owners of Bar Marco in the Strip District, who, in 2015, promised to eliminate tipping at Bar Marco and The Livermore by paying full-time servers $35,000 per year for a 40-hour work week, plus health care, bonuses and two weeks of paid vacation. Two years later, Sonja Finn changed over to no-tipping at her East Liberty Dinette in July.

While more national restaurateurs transition to no-tipping, a recent lawsuit filed in California federal court claims restaurant owners are profiting from zero-gratuity policies “at the expense of servers and diners” and that no-tipping is “part of a conspiracy to charge [diners] more for their food,” Law360 and Eater.com reported last week.

Service issues

“I’m all for waiters making as much as possible,” Mr. Keyser says. “I want them to make a good living,” but he’s also hyper aware that there’s such an income discrepancy between the front- and back-of-the-house staff, which is one of the reasons he launched with the no-tipping policy there.

He hoped that paying staff $17 to $22 an hour would entice more people to work for him; there’s as much of a restaurant staff shortage here in the restaurant industry as there is in New York, he says.

But a couple of factors played into the challenge of keeping the policy. For one, his menu prices are higher per plate than a tipping restaurant: It’s $11 to $16 for small plates like salt cod or octopus and $14 to $16 for larger ones like beef cheeks and polenta or tagliatelle with pork belly and tomato.

A higher price per plate can lower a restaurant’s perceived value, despite the fact that diners may pay the same for a comparable dinner at a restaurant that requires tips.

Another factor: location. Casellula, as the lone restaurant on West North Avenue, is for the moment “fairly isolated,” he says, with few new restaurants on the North Side, compared to the bustling Strip District and the restaurant corridor that’s taking shape in East Liberty. “I have every confidence that in three years there will be more restaurants here,” he says. But for now, it’s a destination.

The Casellula partnership with City of Asylum ensures he sometimes has to hire extra staff on event nights. That’s not necessarily because it’s going to be busier, but because there is a reading, which means the dining room will be quiet. If customers opt to eat in the downstairs dining room instead, extra servers are needed.

The expense

Now that he allows tipping, Mr. Keyser believes he will have an easier time hiring, since potential employees don’t have to navigate the less-familiar, no-tipping policy. There’s just a handful of restaurants in Pittsburgh that don’t accept tips.

And while he points out that pilots, nurses, and engineers don’t rely on tips to stay motivated, until more restaurants embrace no-tipping, it’s exceptionally hard to set the example, he said. Restaurant groups with the deep pockets of New York’s Danny Meyer and Tom Colicchio are seeing more success than indie mom-and-pops.

Here’s what Mr. Keyser hates to admit most: “Having 10 months here,” he says, “I do think that workers will be more motivated when it affects a paycheck,” in part because many of his employees are part time and have other sources of income. If more restaurants paid a higher wage it would level the playing field.

With the return to tipping, he also expects his labor costs to go down. Ms. Finn of Dinette concurs. She said it was hard to change over to the no-tipping model with the restaurant celebrating its ninth year earlier this month. And with her switch to paying staff more than $20 an hour, “I am taking a financial hit,” she says.

Regardless of cost, Bar Marco, the city’s no-tipping pioneer, says it’s committed to it, and that the closing of The Livermore is a factor of the changes in the organization.

Since Bar Marco opened in 2012, co-owners Bobby Fry and Michael Kreha have moved on to other pursuits, with Kevin Cox and Justin Steel the remaining partners. Mr. Steel has taken the helm in the kitchen — what he wanted to do in the first place — while events on the second floor and in the wine room remain a constant.

“There are a lot of reasons The Livermore closed,” Mr. Steel says. “It’s not because of no-tipping.”

Melissa McCart: mmccart@post-gazette.com

First Published: October 16, 2017, 9:40 p.m.