It wasn't demonstrated, it was assumed. Mostly because you will need broad understanding of economics. I'll try to do my best to demonstrate it. Imagine a smaller economy where there is only 1 firm. They have complete power to set wages, you don't like it you don't work. (We've already established this would happen eventually if agreements like this were allowed because it is far easier to control wages than it is to create new and competing firms.) What happens when they decide not to pay a living wage? More importantly, what is to stop them from influencing laws such that what becomes fair practice is changed over time? Is it fair to allow a single entity the power over not just the economy but the power to define what is just? We have to be very careful in a capitalist society about confining the limits of what actors are allowed to do because quite literally money often equates to power and with time power defines law. I hope it goes without saying that enough bad laws over a long enough time span are trouble for everyone in society. Unregulated capitalism will always lead to issues for a society because it always concentrates wealth. (Those with the most information and the best decisions always come out more ahead than the rest.) Remember, capitalism isn't the best way to run an economy its just the least bad.
Also, please remember you can't look at a statement in a vacuum. "Why isn't it? Those agreements don't restrict or infringe on the freedom of others to form different agreements, or avoid forming them." Perhaps not technically, but realistically they absolutely do. If we had a million worlds with a trillion firms and easy travel between them then such actions would automatically correct, but we don't and thus people do not realistically have the option to turn them down. The whole point of capitalism is to reward and penalize decisions. It kind of breaks down (predictably) when one side has enough power to prevent the downside of a bad decision.
Remember, free speech doesn't mean you can run into a theater and yell fire.
Take the argument to the extreme, is it OK for every employer in every industry to agree on wages and no-poach? What about on child labor? Minimum Wage? What about colluding on prices? Aren't these all the same infringement? The truth is sometimes society has to take away the rights of the few for the sake of the many. While I agree we tend to do it too often, you will be hard pressed to find many who agree with you on this matter. The fact is rules like this almost certainly make our economy more productive as a whole.
2982 (increase in sales) x .15 (assumed tip amount) = + $447 divided by all tipped employees. But you have to remember even many small chain restaurants have 15-25 tipped employees this nets to very little increase in income per tipped employee and zero increased income for non-tipped employees. Next, subtract from that small increase all the money they used to make from theft and overall they are likely coming out of the deal with less income.
You don't have to agree with it for it to be happening. Though, understanding that side of the argument can help solve the problem for both sides of the equation.
Nothing ever comes for free.
$2,982 x .15 = 447.3 (best case)
I don't have any good numbers but its safe to say that the amount of theft prevented (the amount the their income has decreased since this was implemented) is greater than the extra $20-$70 ish dollars that their income has increased from increased sales.
In other words, their net income is down. I wouldn't be surprised at all if the net increase in sales isn't just a temporary scramble to keep income up / items actually being rung up. The truth is this benefit will almost certainly decrease as more knowledgeable and productive servers find jobs elsewhere or find new methods around the system while the remaining lower skilled / productive settle in at the amount their effort is actually worth.
I have doubts this action would produce a net benefit in the long run. (As quality of service decreases.) Its easy to think that the only people stealing are the "lazy and incompetent". In my experience the most skilled "thieves" are also the hardest workers with the most in depth knowledge of the controls the restaurant has in place. They also tend to desire/need/feel they deserve the cash more than the average employee. (and to most extents all three are true) Of course, all of this applies to the tipped employees, non-tipped employees will feel this doubly so though their forms of theft tend to be easier to track / reduce.
Theft in a restaurant setting is a complex issue, there is no magic bullet to stopping it.
^This a million times. I'm so sick of all the irrelevant arguments made by ALL the parties involved. There is only ONE product type that can hold an artificially high value for any extended period of time; a status symbol. By definition status symbols are impossible on any digital medium. THEREFORE, stay off the internet or follow economics. I will respect either choice. I will laugh at anyone that expects to get the benefit of both without the cost of the either.
Quite a few friends of mine took this test. 4 of the 6 of us who felt we almost certainly choose google could not load the results page. Not exactly a scientific study but I thought it was fishy. Anyone run into similar results?
Also, please remember you can't look at a statement in a vacuum. "Why isn't it? Those agreements don't restrict or infringe on the freedom of others to form different agreements, or avoid forming them." Perhaps not technically, but realistically they absolutely do. If we had a million worlds with a trillion firms and easy travel between them then such actions would automatically correct, but we don't and thus people do not realistically have the option to turn them down. The whole point of capitalism is to reward and penalize decisions. It kind of breaks down (predictably) when one side has enough power to prevent the downside of a bad decision. Remember, free speech doesn't mean you can run into a theater and yell fire.