a bit about our
service charge & tips

Beginning Tuesday, September 8th, 2026 there will be a 20% mandatory service fee included in your check total when dining at Community. This service fee will be distributed amongst the entire staff at community and help pay wages and benefits for all. There will be the option to leave additional gratuity. Some guests may want to have this as an option, so it will be provided, though it is not expected. We will clearly note that the service fee is already included on the menu, your check, the credit card slip, and our website.

Chicago City Council passed the "One Fair Wage" ordinance in October 2023. This ordinance phases out the subminimum wage for tipped workers, gradually eliminating the "tip credit" over a five-year period until all tipped employees earn the standard city minimum wage. In other words, tipped workers had a lower minimum wage to account for tips. If their hourly wage plus tips did not meet minimum wage, then the employer would pay the difference. As this "tip credit" has been phased out, our labor cost has increased dramatically in a short period of time. It's not sustainable.

Restaurants operate on a razor thin profit margin. We are no different. We are a small, independently owned restaurant. We have no investors. We barely break even. Some years we don't even do that. The rising cost of labor and health insurance, which has increased in double digits every year, is beyond difficult to absorb.

In the last three years, our cost of a tipped employee increased by $3.48/hour. In another three years, our cost will have risen another $4.09/hour. That is an increase of $7.57/hour in six years...an 80% increase. This increase has only been for our front-of-house employees (the tipped employees). This group also includes some of our highest paid employees. Our front-of-house employees make a much, much higher hourly rate than the current Chicago minimum wage of $17.05 due to their tip income. These hourly wage increases make it nearly impossible to give any raises to our non-tipped employees, including cooks, dishwashers and salaried workers. We have even been forced to consider canceling our health insurance coverage. We haven't, thankfully. That would be a last resort. Many of us depend on that coverage.

How would instituting a service fee help with all of these rising costs? A service fee can be taken in, divided, and distributed in a way that is more sustainable and equitable. The house will take a percentage of the service fee to offset the tipped employee hourly wage increase, pay for health insurance, and hopefully allow us to give more regular raises and/or bonuses. Each night, a percentage of the service fee will also be shared with the hourly kitchen workers, a much deserved wage increase for them. The remaining service fee will be divided amongst the front-of-house workers per usual. Any gratuity given on top of the service fee will go directly to your service staff team that night.

This is a mathematical reasoning for why we are making this switch to the service fee model now, but it's not the only reason we have wanted to make this change. In fact, we wish we have made this change sooner. Tipping has roots in racist, post-Civil War labor laws that allowed white Americans the right to pay Black Americans less than the federal minimum wage. Additionally, while most of our guests are absolutely wonderful, not all tippers treat our service team members with the respect they deserve. There can be judgements made based on criteria that has nothing to do with the actual service or hospitality being provided. As I touched on earlier, there has also been an inequality for years and years between the wages earned by service staff and kitchen workers. We've always just followed the system because it's what we have experienced everywhere, and we didn't really know anything else. It's long overdue that we make a change for the better.

You may also see that the service fee is taxed. Because the IRS and state taxing authorities do not consider a service fee to be an optional gratuity, these fees are considered business income, unlike a tip. We pay 10.25% state tax on all income, including the service fee. We also pay a 0.5% restaurant tax in the city of Chicago. Until the IRS changes its understanding of such service fees, it will continue to be taxed according to the state and local tax rates, same as any food or beverage.

You may ask, "How do I know this service fee isn't just going into the pockets of the owners?" Well, it's not an ideal move for us. We are even losing out on a federal tip credit by switching to a service fee model because, remember, the IRS considers it income. This service fee does not come close to covering the actual cost of labor and benefits. I'm not exaggerating when I say we barely break even, and some years don't even do that. Chef/Owner Joey Beato makes a humble salary. Owner Brenna Beato takes almost no salary at all, opting for an outside job a few years back. We are making this change because we have to, and for the betterment of all employees, not just some. There is no extra money to put into our pockets, unfortunately.

Some people may ask, "Why not just raise your prices then?" Well, we have raised some prices, modestly, over the years. Still, we feel that increasing the prices of all food and beverage by 20% or more is going to leave people with sticker shock. We prefer to keep our prices as low as possible and offer a great value to our local community and beyond. Even still, our restaurant is not a cheap restaurant. We buy great products, we change the menu seasonally, we make nearly everything from scratch, and those things come with a cost. In the end, if we raise all menu prices or switch to the service fee model, isn't it all pretty much the same in the end? We feel that this way is clear, transparent and makes accounting for everything much more organized. Additionally, if we just raised all prices, but kept the tipped system the same, it would mean those tips continuing to just go to servers, bartenders and support staff, not the kitchen. That continues to increase and inequitable system, and we aren't down for that.

All in all, we believe that the cost of dining at Community will be about the same as it has been. We're just reworking the nuts and bolts of it in a way that is more sustainable and equitable for our business and every member of our team. We appreciate you taking the time to read this, or skim through it. It's very long, we know. We would not be able to do what we do without the continued support of our guests, our community, our friends, our families, and our amazing team members that have continued to shape Community into what it is today. As small business owners, we must continue to change and adapt in order to survive. This is another change we must make to hopefully make us even stronger and able to continuing serving you all for many years to come.