Saturday, 16 Nov 2024

The Misadventures of an Idealistic Restaurant in a Cut-Throat New York

When Emily Elliott moved to New York from North Carolina almost 12 years ago, she handed out resumes in the East Village and slept on her sister’s couch. Two weeks went by and no one hired her. Just as she was starting to feel desperate, Colors, a new restaurant cooperative in NoHo focusing on fair wages and equality, offered her a position as a line cook.

Ms. Elliott found Colors, as she put it, “morally correct.” She recalled a Muslim cook who excused himself to pray in the locker area each day, even during peak hours. The staff, many of whom came from Windows on the World, the restaurant atop the World Trade Center that was destroyed during the Sept. 11 terror attacks, came from more than 20 countries. At Colors, staffers collaborated on a menu that reflected their various ethnicities — pad Thai, risotto, a Japanese-style smoked tuna. “It was like the Queens of restaurants,” Ms. Elliott said. “I never worked anywhere that was nearly as diverse.”

Six weeks later, Ms. Elliott quit. She wasn’t getting paid on time.

Working at a restaurant is a rite of passage for many New Yorkers. For some it’s a way to finance their dance classes or start-ups or screenplays. For countless others, it is simply a way to survive. But the model of working for cash in a restaurant is changing, as several businesses, in an effort to guarantee workers a better hourly rate, are doing away with tipping. There is also a campaign underway to raise the wages of tipped workers across the state and the country. Such changes could raise prices all around, affecting the entire food-service ecosystem in New York.

Increasing wages for food service workers is certainly a noble cause, one that aligned with the ideals of Colors when it first opened, in 2006. But good intentions are one thing; running a restaurant in a city as competitive as New York is quite another.

Colors was a fine-dining cooperative where employees had health benefits and made almost $10 over the tipped hourly rate. But there were other variables that hampered this lofty vision from working smoothly, like complex labor laws, fees from health department inspections and high overhead. Former employees described a restaurant strapped for cash and with no clear leadership. Clark Wolf, a food and restaurant consultant, described Colors as an “incredibly well-intentioned but logically doomed-to-fail situation.”

Colors restaurant quietly closed in 2017.

Restaurant Opportunities Centers United (ROC), the nonprofit that was the organizing force behind Colors, is still going strong, as it fights for what it calls One Fair Wage, which is to say, raising the minimum wage for all tipped workers across the country. It has also announced a new business model for Colors restaurant in New York, which is rescheduled to reopen on the Lower East Side next year.

One Fair Wage has its supporters and its detractors. In states like New York, employers can take a “tip credit” and pay servers a lower wage, as long as tips help meet or exceed the minimum wage. Restaurant Opportunities argues that this two-tiered wage system perpetuates sexual harassment, poverty, wage theft and workplace discrimination.

Others are concerned about a ripple effect. Restaurants will need to raise prices if the tip credit is eliminated, said Andrew Rigie, the executive director of the NYC Hospitality Alliance. “Customers are currently, constantly complaining that it’s so hard to go out and have a meal because it’s so expensive,” he explained. If prices increase, people could start to tip less.

Earlier this year, Gov. Andrew M. Cuomo ordered the New York State Department of Labor to hold public hearings on the issue. The Manhattan hearing in June drew a fiery crowd of protesters on both sides of the debate. Behind the barricades, there were chants of “Better wages, better tips!” One sign read: “Cuomo, we don’t need saving.”

“It was the closest thing you can get to a riot on minimum wage,” said Louis Pechman, a labor lawyer in New York.

Danny Meyer, the founder and chief executive of the Union Square Hospitality Group, recently admitted that after implementing a no-tipping policy, he lost close to 40 percent of his front-of-house staff (including waiters, bartenders and hosts). Other restaurateurs who followed Mr. Meyer’s lead in 2015 — like Andrew Tarlow (Marlow & Sons, in Williamsburg) and Claus Meyer (Agern, in Grand Central Terminal) — ended up reversing course this year, citing an increase in pricing that was not sustainable. Marlow & Sons returned to the tipping model on Dec. 17.

“It’s become impossible to ignore that removing tips has created new challenges that we are unable to solve, chiefly that prices have hit a peak that the market cannot bear,” Mr. Tarlow wrote in a statement.

“I’d still like to see us get rid of tipping,” said Amanda Cohen, the chef and owner of Dirt Candy, a no-tipping restaurant in New York. She increased menu prices by about 20 percent, which allows her to pay her kitchen staff, who don’t receive tips, a higher wage.

But some servers are nervous about losing their tips. Alcieli Felipe, a waitress at the restaurant Lido, in Harlem, said that immigrants might be the first to go if raised wages and no tipping are enforced at her restaurant. “Who are they going to cut first? The ones who don’t speak English who work at the back of the house.”

Laura Strauss, a waitress, said the pressure of pleasing customers exists even without working for tips, and the no-tip model she worked under for a while limited her income. Now working for tips, she makes about $200 a day, up from $120 before. If the tipped wage were eliminated, “I would definitely not stay in the industry,” she said.

This was one of several conflicts that Colors hoped to solve. Saru Jayaraman, the president of Restaurant Opportunities, said that the no-tipping model is not what her organization is advocating for. It wants — and has successfully established in seven states so far — a continually increasing minimum wage for tipped workers. The tips of servers in California, where such a practice exists, have remained consistent since wages were increased, Ms. Jayaraman said.

Many servers in Maine, however, successfully organized to have their salaries lowered in 2017 after a referendum the year before had increased their wages. The reason? Many had already noticed their tips were disappearing.

Barbara Sibley, the owner of La Palapa in the East Village, said she was torn when it came to raising wages. “The structural things Saru talks about — sexual harassment — are true, but I can’t change the experience for my guests here,” she said. “Regulatory things have a real impact on the ground floor.”

Shortly after Sept. 11, 2001, a union leader for Windows on the World, approached Ms. Jayaraman, who was then a young, ambitious lawyer, to help find jobs for the displaced workers. She had a fervor for workers rights and an impressive resume: degrees from UCLA, Harvard and Yale. But she had never worked in a restaurant.

Still, she met with 250 former Windows employees. In 2002, she helped found Restaurant Opportunities Centers United. Its mission was “to organize workers to improve wages and working conditions throughout the restaurant industry,” Ms. Jayaraman wrote in her 2013 book, “Behind the Kitchen Door.

Over the years, Ms. Jayaraman, now the president of Restaurant Opportunities Centers United and the director of the Food Labor Research Center at U.C. Berkeley, became a voice for minorities, immigrants and women in the industry, helping win back more than $10 million in stolen tips and wages. She’s known for her work ethic and ability to rally a room. Francesco Palmieri, a chef who worked at Colors when it first opened, called her a trailblazer.

Starting around 2003, Restaurant Opportunities raised more than $2.8 million to open Colors. Fekkak Mamdouh, a former Windows on the World worker and a co-founder of Restaurant Opportunities, had the idea for Colors. “With Windows on the World, we were like a family, a real family,” he said. “I was hoping to have a restaurant where all of us could work together and stay together.” A 6,000-square-foot space on Lafayette Street, next to the Public Theater, had been designated for the restaurant, and Restaurant Opportunities set up the corporate entity, 417 Lafayette LLC, to own and operate it. “Everyone had great hopes for the place,” said Raymond Mohan, the executive chef of Colors when it opened.

From the beginning, workers believed in the mission of the restaurant to lift them up and treat them fairly. Some Restaurant Opportunities members were even offered a stake in Colors during the planning stages, when the concept of the restaurant being a worker-owned cooperative had been discussed.

The momentum for wanting Colors to succeed was palpable. A Time Out review from 2006 started out with the restaurant’s “warm and fuzzy back story” and said it had “potential for a great new restaurant.” It brought up the international the staff and described a “swank Art Deco” interior. But that was where the good will stopped. “Sadly, the feel-good restaurant of the year — the place we all want to root for — just does not seem ready for prime time,” the review said.

Among some Restaurant Opportunities members, there was conflict from the start, beginning with the logic of opening a cavernous space in a hot neighborhood like NoHo. “A lot of the people in Colors are minorities,” said Behzad Pasdar, a member of the committee helping to create Colors. “So why aren’t we going into Queens and opening a cool little Mexican restaurant?”

Just a year later, Mr. Pasdar and seven other Restaurant Opportunities members sued Restaurant Opportunities and Ms. Jayaraman. The members had performed what Ms. Jayaraman called “sweat equity” — fund-raising, picketing restaurants, catering, meeting politicians — in order to become worker-owners of Colors when it opened. When some voiced fears that the co-op model they were promised might not pan out, they were expelled, according to the complaint. Ms. Jayaraman said that Mr. Pasdar and the others involved in the suit left the organization on their own accord, before the restaurant had even opened.

“It was a shame, because it was a great idea,” said Arthur Schwartz, the lawyer for the plaintiffs. “That they were behind putting together a worker-owned co-op gave ROC panache in the political world, but it never happened the way they said it would.”

Ms. Jayaraman said that Colors did indeed become a cooperative-owned restaurant for at least seven years.

The suit was dismissed after the federal court ruled that the plaintiffs were not “employees” under the Fair Labor Standards Act.

All the while, Ms. Jayamaran effortlessly moved among the powerful, advocating for restaurant workers’ rights.

In 2013, as Colors was still finding its footing, Restaurant Opportunities started One Fair Wage. The campaign has garnered an outpouring of celebrity and political backing in recent years. Hillary Clinton stopped by Colors during her presidential campaign. Mayor Bill de Blasio visited on Sept. 11, 2016. This year alone, Amy Poehler took Ms. Jayaraman to the Golden Globes. Sarah Jessica Parker auctioned off her dress and jewelry at a Dolce & Gabbana party to benefit Restaurant Opportunities, and she also hosted a charity dinner for One Fair Wage. And most recently, Jane Fonda, who is campaigning for One Fair Wage, called Ms. Jayaraman “the Cesar Chavez of restaurant workers.”

Restaurant Opportunities is now urging people to sign a letter to Mr. Cuomo in support of One Fair Wage.

When Colors first opened on Lafayette Street, it offered training and gave restaurant novices hands-on experience. Chris Sciarrotta, a waiter from Long Island, needed serving experience in Manhattan. David Cardenas, who had emigrated from Cuba, wanted to learn how to tend bar. Ashley Ogogor, a waitress from Texas, learned about silverware placement. Working at Colors provided a foot in the door for them. “I was talking to the clients I was handling money. They trusted me,” said Mr. Cardenas, who ended up working as a bartender at Colors.

Many of the staffers also became politically involved. In October 2014, Mr. Sciarrotta and Ms. Ogogor, while working for the restaurant, were also campaigning on behalf of One Fair Wage. They spoke at events like a wage board hearing in Harlem. But they were also noticing that their paychecks from Colors were arriving late.

For them, it was a convergence of idealism versus practicality.

“I was like, ‘Listen, I’m all about giving tipped workers who are sub-minimum wage higher pay and better working practices,’” Mr. Sciarrotta said. “‘I totally advocate it. But your point of view isn’t working right now, so I don’t want to be on a sinking ship when I also have bills to pay.’ I was all about helping them out, but when their ideologies weren’t on par with what I needed, I was just done.”

Workers at Colors were paid a fair wage, sometimes up to $13 an hour. But foot traffic in the restaurant was lacking, several servers said, so it was difficult to make decent tips.

“I’m sure mistakes were made, things were challenging,” said Ms. Jayaraman, who had moved to California by 2011. She said that she didn’t know Mr. Sciarrotta or Ms. Ogogor, but that the delayed checks issue was “unacceptable.”

Over the years, Colors had several makeovers. “It had become a restaurant in the wallpaper of New York,” said Stephen Zagor, the former dean of business and industries at the Institute of Culinary Education. “You never heard about it.”

In 2014, it even switched to gluten-free fare, the trend of the moment, but it made little difference. Wages fluctuated, Mr. Sciarrotta said, and paychecks were increasingly late. The bar couldn’t afford mint for cocktails and downgraded to a cheaper chardonnay. The kitchen was regularly running out of staples like fish and steak, servers said.

In 2017, the landlord of Colors died, and the restaurant’s rent skyrocketed. Colors relocated to the Lower East Side.

At its new location on Stanton Street, the restaurant lasted only a few months, as it waited on a liquor license and then the air-conditioner broke during a very hot summer. But Colors has continued as a training institute and sometimes holds special events. Ms. Jayaraman said that early into the Colors experiment, she realized that its true purpose was to teach restaurant skills and empower workers, which it what it has focused on since 2007. Training facilities, called CHOW (Colors Hospitality Opportunities for Workers), have expanded into nine states, she said.

And come next March, Colors 2.0 will open on Stanton Street. Workers will be paid fair wages, said Ms. Jayaraman, thanks to a new business partner. “We decided we’d focus on the training and work with experienced partners to run the restaurant,” said Ms. Jayaraman.

Owning a restaurant is not for wimps. Those who work in the industry “have chosen to do a very hard thing, with a very limited statistical probability of ever making any real money: serving food to people,” Anthony Bourdain once wrote. With over 25,000 restaurants across all five boroughs, staying relevant and popular — while swimming with real estate sharks and fickle consumers — is a serious challenge. Arguably, a restaurant such as the original Colors on Lafayette, may have aimed a bit too high for a first try.

Others think Colors was simply ahead of its time. “In point of fact, it might work better now than it did then,” said Mr. Wolf, the restaurant consultant. “We’re seeing the minimum wage thing and the #MeToo thing, and the tip-credit thing all be focused on semblance of fairness of people who work in restaurants.”

Emma’s Torch, a nonprofit restaurant that employs and trains refugees, for example, opened in Carroll Gardens in May.

“More and more the notion of a restaurant as fancy people being served by their lessers is anachronistic,” Mr. Wolf said. “And I think we’ll see some of the things evident of Colors come back again and again.”

We’re already seeing it: Colors New York is preparing to make its comeback as a full-service restaurant next year, while One Fair Wage is gaining steam, with campaigns underway across the country. In New York, backers and opponents of the tip credit are anxious to hear the Department of Labor’s recommendation.

Ms. Jayaraman says she thinks that the restaurant industry is resistant to change — in particular, to increased wages for all — but that it’s doable, and the time is now. “Portraying it as doom and gloom doesn’t match with the data,” she said, citing thriving restaurant scenes in California and Oregon, which have embraced One Fair Wage. “I think the real concern is if New York moves to One Fair Wage, the National Restaurant Association knows what we already know: that other states will follow.”

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