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Danny Meyer sued in tipping scandal Glimcher becomes Starwood CEO

Mensch:
Noun. A decent, upright, mature and responsible person.

Schlemiel:
Noun, slang. An awkward, clumsy, or unlucky person whose endeavors tend to fail. A loser.

Mensch of the Week: Michael Glimcher

Michael Glimcher joins the Starwood Retail Partners team as new CEO. Previously, Glimcher was CEO of Glimcher Realty Trust for 12 years. With 27 years of experience in REIT, Glimcher has a lot of new ideas for the future of Starwood.

Starwood is responsible for 30 retail locations in 16 states, but Glimcher wants to expand. Currently, Starwood properties are limited to malls and lifestyle centers, but Glimcher wants to repurpose them. By adding residential housing to some malls and offices to other malls, Glimcher believes Starwood can survive. 

Glimcher Realty Trust was acquired by Washington Prime Group, leading him to find a new position. After hearing about Starwood’s interest in him, he jumped at the opportunity. Glimcher says his focus is “inside our four walls… on taking care of what we have”.

Schlemiel of the Week: Danny Meyer

Danny Meyer and other restaurateurs are being sued for wrongful possession of employee tips. Days ago, Meyer was seen on 60 Minutes boasting about his new gratuity-included business model. Or, as Meyers puts it, “hospitality included”.

At just 27 years old, Meyers pioneered his first restaurant, Union Square Cafe. Shattering standards for fine dining, Union Square Cafe featured bar seating and was less intimidating than other 3 star restaurants. But, his most recent idea turns out to be a scandal disguised in innovation. The new gratuity-included dining experience is advertised as being more convenient for the customer. However, it may just be more convenient for Meyer’s pockets.

The issue Meyers claims he was aiming to solve was the wage disparity between tip receiving servers and back of house workers who legally cannot accept tips. In 2015, meal prices were raised on average by 20-30%, and employees base salary was increased slightly. However, it’s been brought to light that the extra 20-30% of meal prices are being transferred to Meyer.

Gratuity-included dining is not unheard of. Some Europeans still tip on top of what’s expected because, anyone who has been in the serving industry, knows it’s hard. This abhorrent misuse of employee salaries makes watching Meyer on 60 minutes painful.

Meyer is not alone. David Cheng of Momofuku and a number of other restaurateurs are all part of “Tip Gate.”  Andrew Rigie, Executive Director of NYC Hospitality Alliance says “We believe the lawsuit is baseless on the merit…We intend to vigorously defend the matter in court”.

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