They are also the first ones to moralize people about how tipping is a must and if you don't tip, that poor waiter will be unable to make a living.
NO! The ones that get away easy in this whole scheme are the owners that have now no responsibility to pay their employees correctly.
Profits should be split, regardless of how tips are handled.
They try to keep the cost of food at 30%, as is common in business. COG around 1/3 or less.
So when we have a really busy night, there is excess profit relative to the amount of tips.
Assuming tips are a constant percentage of sales, the amount we earn extra is proportionate to sales.
But there is a certain minimum number of sales the owner must reach to break even. At a certain volume, profit accelerates further, but tips are still relatively constant.
So my desire would be for a restaurant to split excess revenues more equitably in addition to whatever baseline wage they set.
Perhaps, but it sounds more like that your minimum wage isn't set to be a living wage[1].
That's the important part - minimum wages should be set so that someone who is working full time (~40 hours/week) should be getting enough income so that they can afford a modest standard of living for themselves and a family too.
Can I ask... Why? Shouldn't a "minimum" wage provide a "minimal" lifestyle rather than a modest lifestyle? And why should one be able to support a family on a single minimum wage?
Also, modest = minimal by the original standards.
Historical context: https://www.law.cornell.edu/wex/minimum_wage
It means being able to afford the basics: housing, food, healthcare, transport, and still being able to have enough left over to build a 'rainy day' (emergency) fund.
And the reason "modest" rather than "minimal" is because one is living, the other is effective slavery.
People who cannot afford for one moment to stop are people who are on the edge of disaster. Any (additional) misfortune that strikes - whether by their own actions or not - could send them from "surviving" to now being forced into debt, which while it might provide temporary relief, almost certainly means they are now in a downward cycle.
With a living wage, even if misfortune does drive them into debt - there's at least a better opportunity for them to work their way out.
Source: Most people i know who earn tips, are the ones who rather refuse or minimize a tip to someone else (central europe).