Le Cordon Bleu Shuts Down U.S. Operations


The Le Cordon Bleu Campus, Las Vegas

This January, the last class of students will enter Le Cordon Bleu, the popular culinary school with 16 locations around the United States. The for-profit school falls under the purview of the Obama Administration’s gainful employment rule, which cuts off federal funding from any school where graduates borrow money at high rates to pay for school but earn little after graduation. Many such institutions have recently come under fire for their predatory enrollment practices and misleading promises about job placement. Le Cordon Bleu in particular was the subject of a 2013 class action lawsuit alleging that the school oversold the benefits of their degree. They settled out of court for $40 million dollars.

Le Cordon Bleu is best known for it’s flagship location in Paris and famous alumna Julia Child, but branches in the U.S. are run by the Career Education Corporation and act largely independently from the original. The Career Education Corp. had previously announced that they would sell off the culinary school, but eventually decided it would be more cost effective to shut them down entirely and focus entirely on online schools instead.

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Move to End Tipping Gains More Momentum

yI1Ya0x8QbiTi7potxLc_022.jpgDanny Meyer’s decision to end tipping at all his restaurants has already become the sort of high profile case that’s likely to spark conversation and debate in circles reaching far beyond the industry. As two more restaurateurs move to join him, it now seems like his announcement represents a major tipping point (pun intended) in what is considered standard.

This week both Gabriel Stulman and Andrew Tarlow announced that they would eliminate tipping at some or all of their restaurants. Stulman is the owner of six casual restaurants in downtown Manhattan, including Fedora on West 4th where he plans to eliminate gratuities in January. Stulman calls this a test drive of the new system, but ultimately he hopes to implement it at more of his restaurants as well. Tarlow, who is responsible for Diner and Marlow & Sons, said he plans to completely eliminate gratuities at all of his restaurants in 2016.

Although Meyer seems to have set off a domino effect, the trend is likely also due to the $2.50 increase in New York’s tipped minimum wage, which will go into effect in January. For many restaurants, it makes more sense to eliminate tipping altogether and hope that they can communicate the change effectively and avoid sticker-shock at higher prices.

Although the anti-tipping movement cites fairness as a major motivator, with higher wages for back of house workers as well as well as front of house, some employees may balk at the change, which puts more money in the employer’s pockets (at least until it reaches the workers paychecks). Stulman in particular is preparing for this backlash by offering “guaranteed wages for the members of our dining room team to be consistent with what they were averaging before the change.” To meet this requirement he’ll be increasing prices around 25% across the board.

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