Just do away with tips. It's a terrible and stupid system. If you want to do it as a customer, go ahead, but it should never be considered as part of the employee's compensation. If people aren't willing to do the job for the hourly wage alone with no tips, raise the wage until they are.
Tips are fundamentally broken. If you didn't know about tips, and someone offered you a job and said, "I'll pay you crap wages, but you can ask the customers for more money. Don't worry, they'll pay or their friends won't like them," you'd think it was a scam because it's such an obviously terrible deal.
Tips are an awful way to incentivize good service.
I'm neither qualified to judge my server's performance, and I've got very limited and potentially misleading information about what a reasonable expectation is. I've got no idea what small crises my server had to deal with, or how other customers are treating him.
And because tips are everywhere now, nobody knows the going rate for most tips. Obviously tourists have no idea how much to tip.
If I reduce the tip, the waiter is only finding out that I was unsatisfied after it's too late to fix anything. But tipping up front makes the exercise entirely pointless.
And the moralizing of tips is stupid.
Many moral arguments paint people in the service industry as paupers or victims, but a basic level of respsect has to assume they're competent professionals who chose this line of work.
A tip is not an act of generosity, either, you're paying a fee for a service rendered. And that's why, as a system, the morality of tipping is entirely backwards: it rewards people who rip off their servers.
The thing that really bothers me are the awful motivations behind tipping: being control freaks, conspicuous consumption and all the slimy business incentives to push their payroll onto their customers.
You're absolutely right, given the premise that we tip to incentivize good service. In reality, we tip so businesses can advertise an $18 meal for $14.99.
And also so that customers can dangle a tip in front of an underpaid, overworked employee, only to snatch it away if they don't smile or go to church or insert some arbitrary reason here. It's both consumers and employers who keep the tipping culture and its toxicity alive.
I mean the one time I was in the US having breakfast or lunch at some random place. They had at least five staff milling around for twenty-five customers, probably more (staff I mean). You don't need to have two teens frantically going around with pitchers of water, just plop one down on the table and pay the remaining employees a good wage.
A good wage is not minimum wage either. Minimum wage is a "what is the least I can legally pay this employee", while as an employer your mindset should be "how much is this employee worth and how can I make them feel appreciated"
Exactly. We aren't necessarily pushing the payroll onto the customer, we're discounting the cost of a dish at the expense of the server. And to the parent's post, that's an arbitrary decision that sometimes works out and sometimes doesn't for the person making half of minimum wage.
The tipping culture in Spain seems to account for this acceptably well. 1-2€ left on the table for a staff member who poured you a couple of drinks seems to be generally well received. Of course, they know a table of American tourists is likely to be a gold mine so far as tips are concerned.
In the UK tipping is very hit or miss. Especially now that cash payments are becoming rare. I've noticed that food delivery drivers will be half way down the street by the time I open the door these days. They obviously don't expect anything. If there is a service charge on the bill I typically don't leave anything in particular, and I'd prefer it this way.
Same. One time we were out at a restaurant and having all had full meals a couple of us were getting some extras like milkshakes when the Waitress came over to tell us in no uncertain terms that she needed the table back.
This is a very good insight, however the way you say it comes across like you seem to like it or are OK with it. Sarcasm does not come across. We should point out this really is not OK and is not a desirable by anyone except the ownership class.
> A tip is not an act of generosity, either, you're paying a fee for a service rendered.
I once took a cab from my hotel in Zhengzhou (in central China) to the airport. It was during rush hour, so what would otherwise have been a 15-minute drive took over an hour. But the meter was obviously set to work only on distance travelled, and the fare seemed to me to be obscenely low for over an hour of work. I knew in China that tipping wasn't a thing, but having been raised in the US, I felt obligated to try in this situation. You should have seen the insulted look on her face. She was doing an honest job for an agreed-upon price, and didn't need any "largesse" from me.
It’s even worse, in most places, tips are pooled and split evenly from what’s left over after you as the waiter tip out the bussers, bartenders, etc..
It makes for awful office politics.
this may be true, but it is definitely illegal. the owner can keep a tip if directly given to them by a customer (eg, while serving a table), but they may not participate in any sort of tip pool.
of course, "illegal" is very different from "doesn't happen" in the restaurant biz. the owner of the place I worked would often reach into the tip jar to pay himself back when we made mistakes.
haha, right. I've seen it done in most places I've worked when I was younger.
It's also illegal to clock people out during their shift when business is slow and yet many many places do it (because it's not enough to underpay and have employee rely on tips/charity from customers).
I think virtually every restaurant or bar has fine print that any tip over a certain dollar amount goes to the owners. The excess does, that is, and the staff keeps the part of the tip that is under the threshold. It's usually somewhere between $1k-$5k.
Can we talk about why service is astronomically better in the US than countries with very high worker protections and base wages like Denmark?
I'm genuinely curious what you think the factors are in their difference because when I live in Denmark (as I do now) it feels like the waiter could give less of a s** whether the service is good or not whereas when I live in LA or NYC I feel like I am the golden child of their day.
The mind first reaches to "it must be tips" but I am genuinely curious what you think the primary factor of this yawning gap in service is if not tips.
I mean I even worked for a Danish guy who was Noma's head chef's former sous chef (he had just opened a new restaurant in NYC at the time) and the American staff he employed there was just leagues beyond anything I had ever seen in DK.
Others have already said that this boils down to a mix of precarious living not existing to this degree in other countries, and cultural norms. To illustrate with a counterexample: I think I know what you have in mind as good service, but to me (who found the service culture in Denmark really great) this comes across as stalking/ not respecting the customer's privacy/ badly roleplayed friendliness/ thinly veiled upselling attempts. I can't stand it to a degree that I've actually stopped going to a local restaurant because they tried to enforce this service attitude with their employees.
There's this anecdote of Walmart opening a store in Germany and people were horrified by the greeter an the entrance, to a degree that many reported them to the store because they thought he/she was some random weirdo from the street, not an employee of the store. Ditto for baggers, the very idea was appalling for the locals, and Walmarts expansion ultimately failed because of these US service culture imports.
This boils down to the cultural norm: If the behaviour is endemic in the local culture, it comes across as natural. If not, it comes across as fake friendliness in one direction and baseless rudeness in the other.
>>Can we talk about why service is astronomically better in the US than countries with very high worker protections and base wages like Denmark?
Absolutely not in my experience. Only visited America a few times but nearly universally the service was about as good as anywhere in Europe not any better or worse, but it was made infinitely worse by the fact that no matter what, the tips were expected. It left such an incredibly sour taste in my mouth - like, the service wasn't special in any way, the waiter came, took our order, the food arrived, we had it....and now I have to leave like $10 in tips? Like, literally, honestly.....wtf. I do leave tips in europe ocassionally but only when going to really fancy restaurants when the service is exceptional. Tipping everyone everywhere every time is just....crazy.
>>I mean I even worked for a Danish guy who was Noma's head chef's former sous chef
Funny, I know a Chef who actually worked at Noma, he now runs a restaurant in the UK and I'm somewhat familiar with the staffing woes. But in summary from everything he told me - it's like any other business. If you want good employees who are engaged and doing a good jobs....you need to pay well. Pay waiters above the bottom of the barel wage...and suddenly you can find people who give a shit about the job. Pay minimum wage and you get people who'd rather spend half their time outside on cigarette breaks.
I think it's a very cultural aspect. In the US you have the waiters coming up to you, asking if you liked your meal, would you like something else. In Nordic countries people prefer to be left alone, which might be interpreted as not caring. If you were to go to Greece, you could be getting the same experience, with the owner himself walking around the tables and asking what you thought of the meal.
Can we talk about why service is astronomically better in the US
I've been reflecting on my restaurant experiences in the US and Europe and I'm not sure, is it really "astronomically better"? On balance I've probably had people screw up my order and tab at least as often in the US as in Europe. Waitstaff in the US don't seem more knowledgeable about the menu or the wine list, in fact on the whole they tend to be less knowledgeable (probably due to high turnover and restaurants not investing as much in staff). Kitchen 'failures' and food not arriving on time isn't less common in the US and so on.
Sure US waitstaff will be a lot chattier, smile a lot more, ask me more about my day and my meal many more times and say "I am SO sorry" a lot more when things go wrong. But on the whole they don't seem to handle the mechanics of making sure I have a smooth and stress free dining experience any better.
One 'plus' I will give to the US which might account for some of it is that due to wait staff being basically free there are a lot more of them pr. customer which sometimes speeds up service.
Having lived in Australia and the UK, and travelled around Europe quite a bit, and to the US a few times, I could not say that service is astronomically better in the US. I've found it particularly fake and insincere.
When I go to a restaurant, I want good food. I don't particuarly care about the service. That's not to say I want the wait staff to spit on me when I eat my delicious meal, but I'm not really looking for people to constantly suck up to me throughout the meal so they can afford rent.
Mainly I think it is cultral differences in perception of quality. The very American "The Customer Is Always Right" attitude of service staff being there to serve the customer's every whim doesnt really translate as much overseas.
Much of the enjoyment of the meal is predicated on good service though.
Were the dishes served appropriately together or was one person’s salad served 5 minutes after the others? Were the courses paced appropriately? Were the drinks continually available? Were the main dishes served hot and together?
I don’t need a server asking me every three minutes if everything is okay, but I do need them looking things over and ensuring that the things that would negatively affect any diner’s enjoyment are being silently taken care of.
I wasn't drawing a connection to tipping. I was responding to your claim that you "want good food" but "don't particularly care about the service". It's impossible to entirely separate those in my opinion.
Really awkward as well. Basically the whole staff was waving at us until we went around the corner and they couldn’t see us any more. Didn’t know what to do - ignore, acknowledge, turn back and keep eye contact while still walking forward, smile, stop, wave ...
Outside of that it's on an establishment by establishment basis. I know an amazing restaurant in a less touristic Paris arrondissement that will provide stellar service no matter who I show up with or how terrible my French is. Their menus are only in French. If I'm not fast enough the staff notices I'm using a translation app and starts translating it into English.
Japan. Phenomenal service every single place I went and some was so good we tried tipping only to be chased into the street to have the “mistake” fixed.
Service might simply be seen as better because of cultural differences between your home country and one you visit. Example: in France Americans often perceive restaurant service as slow and indifferent, because the French service is not about feeding you and getting you the hell out of the restaurant. The word "restauration" in French implies a restoring (of not just your stomach, but your well-being) and that is what French restaurants are for. Allowing you to be seated and to look around you for a while, discussing rather than quickly selecting what is on offer for the meal, a leisurely consumption of what is served and a pressure-free interval for some digestion make a meal in France slow.
I'm also told that the coyness of the server in bringing the check comes from the feeling of community a restaurant strives to foster: "we would rather you stayed here a bit". Getting pushy about turning a table over simply doesn't happen in France.
I’m curious why ‘good service‘ is important for you?
Because the whole point of going out to eat instead of cooking at home is to have an enjoyable and stress free experience.
If it takes 20 minutes before someone asks what I want to drink, then 60 minutes to get food, you cannot answer any questions about what is on the menu and half the people get the wrong thing and then that completely ruins what should be an enjoyable experience.
Waiters in Europe are not necessarily slow or less knowledgeable, and waiters in the US are not necessarily fast or knowledgeable. What US waiters are, is visibly polite (obsequious, even?) and ever present.
In Europe it's perfectly normal to have a rather rude waiter who takes your order quickly and your food not long after that. They can also be efficient and know the menu in detail, albeit being colder when you discuss with them.
The shock Americans experience is probably due to the frequent stone faces of waiters in Europe.
That's what real people look like when they're not conditioned to always smile and instead they smile when... they feel good :-)
I'm European, live in Europe, and I'm perfectly aware of the service in European restaurants. I still expect "good service" when I go out to eat. I don't care about smiles or being "warm", I care about fast, efficient and correct service.
I'm not advocating the US way of doing things, and certainly don't think the service in the US is better on the whole, in fact in many ways it's worse. However what I have found is that the worst service I've had in the US is far better than the worst service I've had in Europe. I've never had terrible service in the US, and I certainly can't say the same about Europe.
I could tell you many stories of my near-death scrapes with cars and cabs on my hour long bike ride to and from a tiny upscale restaurant in Manhattan, the blistered feet my girlfriend at the time would lovingly restore after 8 hours on my feet, and barely making rent on my tiny Brooklyn apartment I shared with 5 others while narrowly avoiding all manner of attempted thefts of the few discretionary dollars I had left.
When I choose to spend the money I have, I want a good experience. Service is a very big piece of that. My stepfather is a restaurant owner. He has always been the model of politeness. Articles have been written about the magic he'd pour out as maître d' in the early aughts. I learned from him the transformative impact good waitstaff can have on a dinner which is in many ways staged theater with you acting your best (honestly, dishonestly, you are still presenting a face of you) for your date you've held in enough esteem to offer this piece of your life to.
well I've worked long grueling hours - but good service is important because if you are paying money for something you don't want to be treated badly at the same time you are paying money - which has been my experience sometimes in Denmark, although I think the service level has improved in the last decade (maybe I just look more important with age)
first of all, some people seem to dislike what is considered "good service" in the US, so let's call it "high touch" instead. tips are definitely a factor, but I think it's mostly just the US service/retail culture. even people who don't work tipped jobs are quite likely to ask you if you need help finding something if they are not busy.
You can get used to it however and when you go to even a neighbor country like Canada, the staff seems apathetic. I'm not saying they are but it takes an adjustment from the 'high touch' trained Americans.
I think people like tipping because they like this amount of power: enough to feel a bit powerful over other people, but also not so much they have a responsibility to carry.
That's why you're not allowed to tip 0% if the services rendered were worth 0%.
You shouldn't be downvoted. A lot of people make a lot of money off of tips. Does that translate to most? No, but this incentivizes many people to be pro-tip.
>I'm neither qualified to judge my server's performance, and I've got very limited and potentially misleading information about what a reasonable expectation is. I've got no idea what small crises my server had to deal with, or how other customers are treating him.
That's ridiculous. If you're not qualified to judge the value of service to yourself then your probably not qualified for a lot of spending decisions in your life.
Reasonable expectation ? If you're a reasonable person you'll have reasonable expectation and it's really easy to notice when someone makes the experience more pleasant.
And if a car mechanic returned your car smelling like shit would you not be mad because he had digestion issues ?
>That's ridiculous. If you're not qualified to judge the value of service to yourself then your probably not qualified for a lot of spending decisions in your life.
I can trivially judge the necessity of service but unless I am an expert in the domain I cannot judge the quality of service and very often the entire point of the service is to outsource expertise.
I sent my car in for an oil change. They didn't replace the clogged oil filter and it started leaking a little. I had to sent it in again.
Clearly I know that I need an oil change but unless I do my own inspections (the very thing I am paying for) how am I supposed to know that something went wrong?
>I can trivially judge the necessity of service but unless I am an expert in the domain I cannot judge the quality of service and very often the entire point of the service is to outsource expertise.
The entire point of this service is to improve your subjective experience - if you can't evaluate that then you probably need a legal guardian.
I can judge whether I had a good time, but is it the waiter's time things took long or was somebody in the kitchen slow or some other customer holding them up? Is the stain on the table the fault from the waiter not replacing everything or the boss's policy? etc. And if the food and my company is great even the worst waiter has little impact in that.
The waiter is the face of the establishment, but there are many things out of the control of even the best server.
They can do as much as they want. It's the owner's responsibility, thought. The owner makes the decisions. The waiter is the underpaid person, which will be replaced if they complain too much.
If I don't like a place I let the owner know and reduce my spending. If I like the place I tell the owner and spend more.
This is a reasonable comment, and seems a fairly popular idea. But is this the most important comment thread, to be voted to the top, on this particular post?
The topic of the post is alleged blatant theft of tips. The question of whether there should be tips in the first place could be a diversion from the more immediate topic.
A related topic might be all the people suffering the same theft while working for much smaller players.
From there, it moves pretty rapidly to, "get rid of tips and pay a wage that funds people existing reasonably and showing up for work" rather than start a fairly expensive and difficult enforcement effort.
Maybe the idea of just avoiding all this mess to prevent what did happen, and what is happening to a ton of people is popular because it is relevant?
I agree that of all developed countries, tipping is most prevalent in the USA, but as a fellow Canadian I wouldn't assume our Amazon delivery people are being paid anymore. They are independent contractors and not subject to minimum wage laws. If anything, their effective wage might be lower because vehicle operating expenses are higher in Canada.
I understand that part, I don't understand the part where people find it acceptable to tip the delivery person. It's just not ok, unless they brought your fridge up the stairs or something then sure, I'll slip in a little something for the effort. But an amazon delivery driver? Where they drop the parcel at my door, ring the doorbell and leave? Why would I ever tip them? The same with food delivery drivers - I open the door, say "hi" grab the food and they are gone. There is nothing there to tip for.
Also a Canadian, Ontario. I didn't think to tip delivery, but my girlfriend at the time would include a tip when putting cash on the table for when it arrived. My mother's friend tips at Tim Horton's drive thru. So it likely varies a lot between various demographics
The hassle is that even if a place charges more for food, you don't know if they pay their service better. So if you're going to support the "no tips" agenda you'll have to put in the additional effort of looking up wages to decide Starbucks is better than Tim Horton's
" So if you're going to support the "no tips" agenda you'll have to put in the additional effort of looking up wages to decide Starbucks is better than Tim Horton's"
I just....don't see why. I honestly don't get an argument why. When you get a plumber do you check how much they earn per hour and decide accordingly?
Like seriously, it's the biggest scam the restaurant industry has managed to pull off - they are making customers a) worry about this stuff at all, even though you wouldn't for pretty much any other industry b) make them feel bad for not tipping if the company pays poorly. That's incredible. And it's so incredibly condescending towards the workers too "oh you poor slave, you are paid so little, I'll give you some extra cash so you can actually live like a normal human being". There's probably some kind of syndrome that fits this situation.
Sure, but reality is that minimum wage laws exclude waiter positions on the basis of tipping. So if you're anti tipping you should at least make sure you're avoiding places paying less than minimum wage. & you can't know just by looking at the menu
I worked ice cream vending (https://serprex.github.io/w/Ice%20Cream%20Biker if someone wants to read a very dry recount of my first day) where half my income was from tips. The prices of the items were generally like 2.75 to encourage getting me the extra quarter. It's a weird way that the business can leverage advertising a lower price while allowing tips to average out to cover a shitty wage
>>So if you're anti tipping you should at least make sure you're avoiding places paying less than minimum wage. & you can't know just by looking at the menu
But....why should I care about this as a customer at all. Again, I'm baffled how did the responsibility for the wellbeing and income of restaurant workers has been shifted to the customers. The employer should be responsible, not me. It literally doesn't work like this anywhere else. As a customer I also don't check if there are rats in the kitchen or if the chef is pouring grease into storm drains, yet I'm expected to be responsible for the salary of employees?
"After several months working at Café Linnea, he also found he was making less money than if he were receiving tips.
"I think that the wage ended up working out to be like ... an average of what one might expect to make on a slow night, but it didn't adequately make up for the busy nights.""
So sure, people who benefit from the broken system complain if it's being changed. What a surprise. Of course people who happen to make really good money on tips will complain about removal of tips. Shocker.
Somehow elsewhere in the world tips are just not expected and restaurants still manage to hire and retain staff.
Another quote:
"Fox said the no-tipping policy meant management couldn't end up sending servers home early on slow nights."
And....? How is this given as a downside?
And another:
""My employer paid for less than half of my total earnings," he said. "Most of the burden of my earnings was on the customer and thus didn't have to be reflected in prices."
Café Linnea never increased prices enough to make up for the higher staff wages, he said."
Like, I could have told you the outcome of this "experiment" before they even started.
Amazon Prime Now has a 'tip' section with a recommended amount of money to give the driver. It works out to about 10% of the price, I think, generally?
I think it's paramount that anyone using Prime Now sets this value to 0% in the app when ordering. Otherwise you're just subsidizing one of the wealthiest companies in the world. If you really want to give the delivery person a tip for whatever reason(they had to walk through mud to get to you) then give them cash. Don't pre-tip in the stupid app that clearly shows amazon "well, we don't need to pay well since clearly our customers are happy to compensate".
And jesus, if this is not late capitalism then I’m not sure what is. Through the phenomenon of tipping everyone becomes a Caeser-like philanthropist, making life or death choices based on the perceived suffering and performance of their precarious underlings. Meaning waiters, and other service industry workers, compete for crumbs by trying to make other people feel like "the golden child of their day", in a system that systemically undervalues and underpays them (that's putting it very lightly).
David Graeber has a great name for service workers, he calls them 'the caring classes'. [1]
In another article he writes about the British working class:
"In other words, the historical defeat and humiliation of the British working classes is now the island’s primary export product. By organizing the entire economy around the resultant housing bubble, the Tories have ensured that the bulk of the British population is aware" [2]
In a talk he gave he says despite technology increasing the productivity and therefore some wages, "in the caring sector the exact opposite has happened. Digitization is being used as an excuse to make lower productivity so as to justify the existence of this army of administrators" [3], in Britain this has created a "cheerful, creative, and subservient working-class population who, drawing on centuries of tradition, know exactly how to be butlers" [2]
Why not both? Many people would still want to be able to tip for good service even if the employees are paid adequately by their employer, and most of those customers expect the employer to not touch that money at all.
I find the people US society deems it necessary to tip to for service to be arbitrary and jarring. It’s kind of, sort of people you feel sorry for since they don’t earn much, but only if you interact with them, but even then sometimes not?
Janitors and custodians making sure everything is clean? No tip.
Person that brings you food? Tip.
Nurse/plumber/electrician/Government employee? No tip.
Delivery driver? Tip.
Grocery/hardware store/department store employee who helps you find what you need? No tip.
Person who brings out your online order to your car? Tip.
EMT that saves your life, but makes $12 per hour? No tip.
Do you tip your doctor? Plumber? Daycare provider? Cashier? Mechanic? Resturant employees when there is counter service? Hotel housekeeper? Physical therapist? Batista? Cook? Walmart greeter? Ferry crew? Person who sold your tickets? Person who checked your ticket? Usher? Travel agent? Real estate agent? Brewery employee? Winery employee? Tour guide? Hardware store employee who makes you a key? Can driver? Medicab driver? City bus driver? Tour bus driver? Shuttle bus driver? Pharmacist? Pharmacy assistant?
It's extremely arbitrary which service employees "get" tips and which do not. Not everyone agrees who society "expects" to be tipped. The whole thing is absurd and profoundly unfair.
There's no obligation to tip. It's not theft. It's only considered to be a loss of money due to the taxman responding to a lack of reporting over tips.
I've said it before, the only way to get out of the tipping culture is to stop tipping, and to continue to fight for a raised minimum wage. There's just no way around it, that's how some other countries got out of the tipping culture too. Shaming others who don't tip, and tipping when you go out, just contributes to the problem.
If people understand that tipping is actually less of a thing, then the pressure will be on the employers, not the customers.
I know I'll get downvoted for saying that, because we're still much in a "if you don't tip you're an asshole" culture. But I personally have decided that I will contribute to the solution by not tipping.
I've worked as a waiter during my university time and tips were the best thing in the world for someone that did not need any real qualifications. My wage alone would have barely covered my expenses but with tips I paid all of my living costs and could put aside a bit for my future. It was a system I liked as an employee since even when there were few customers I had not to worry too much about getting laid off immediately and the tips I received more than made up for my low wage. People who don't tip out of some principle with no viable alternative at hand other than saying make service employees miserable so that they will change a system that works for them are worse than those that simply are greedy in my opinion, such customers at least do not delude themselves that they are doing Good ™
You were frustrated the customer didn't pay you an arbitrary amount to live off based on their mood instead of frustrated that your boss didn't pay you a legally mandated amount to live off.
The worst part about tipping culture is that somehow bosses have convinced their staff to be upset at customers.
We’ve got to stop thinking about tipping as “the customer giving money to the server as a reward for good service.” and start thinking about it as “the customer subsidizing the business owner so he can save money on wages.” How did making payroll become the customer’s job and moral duty?
vouched this because it more or less matches my experience as a server. also want to second this point. do not "protest tipping" by refusing to tip employees who expect at least 15% to make ends meet. you're not making a point; you're just screwing over some random person.
also this ties into something that a lot of people don't seem to take into account when arguing for abolishing tipping. servers tend to like tipping. they don't enjoy the behavioral pressure, but they generally believe (correctly or not) that they make more money with tipping than they would in a counterfactual world without.
no one said anything about forcing and I don't currently work as a server. I'm strongly suggesting that not tipping doesn't make the point you think it does, and it definitely doesn't help that particular service worker. you're not pressuring the owner to change shit. you're sending home a low income employee with less than they reasonably expected to make off serving you dinner. servers who routinely complain about low/no tips tend to get fired (it's taken as a proxy for poor performance), not given a raise.
This reminds me of some old people in my country who say that communism was the best thing in the world, they had most things provided, they never had to worry about a job or having a place to live, the collapse of the communist government was the worst thing that has happened to them. Sure, there were some problems, maybe you couldn't buy a new car and only had oranges once a year and people elsewhere were going on holidays to the balearics while you had to content with the black sea if you were lucky and the local police station agreed to let you borrow a passport for a couple weeks, but the advantages overall outweigh the disadvantages. To them, people trying to change the system were the bad people - after all, communism REALLY worked well for them, and the winds of change came and the government-secured factory job or subsidized apartment, gas and electricity disappeared. World went to shit for them. Of course change was bad.
And yes, unfortunately the way to fix the tipping problem is to stop tipping. It will be miserable for people like yourself, but if you can't afford to live on a shitty non-tipping wage, you will leave and do something else. Your employer will run out of staff, or will get the worst staff on earth willing to work for a dollar an hour. Even if you decide to stay and live out of your car, you won't be happy. The restaurant will suffer because the staff won't care any more and it will start hitting the owners directly. So wages will increase. It's not rocket science.
That's how unions are formed, that's how people revolt, that's how people start caring about the political side of things and finally make the change happen - they have to be unhappy about the current system first.
And it is a parasite system on some societies - I'm glad you're on the happy side of it, but the system needs to change anyway.
Tips have become so detached from their original intention too. I've been to so many places (pre-covid) that asked for tips upfront during checkout before I've received any service. How would I know what the service would be like and therefore how much to tip? Might as well call it a surcharge and be done with it.
I guess same thing now with food deliveries, but at least I can change the tips (I think?) afterwards if something wasn't good.
I recently visited a place where it was forced hard. If one did not know the POS device, it is baked in.
And, the cashier tells the customer to go ahead and pay, then walks away to fetch their order, leaving them no obvious option other than to select 10, 15 or 20 percent, or the awkward position of asking how to manage the tip.
I have not gone back. I tip, because of the system and the position the labor is in, but I do not appreciate the aggression. I do, however, understand why.
Would much rather see everyone paid well, move bad service to a social issue, and proceed from there.
Are you not from North America? It's more or less impossible to find a restaurant that doesn't have that integrated on their POS systems in the U.S. or Canada. Honestly, 10/15/20 are fairly conservative suggestions, I feel like I see them start at 15% pretty much all of the time.
I’ve always seen a “No Tip” option in the US. And if I didn’t, I certainly wouldn’t patronize them. 10% for a cashier giving you your order is insane. Am I supposed to be giving a 10% tax to all of my cashiers now?
Depends on where you are. Yes, some places have them all over the place, though the vast majority of those have a no tip option, or a clearly indicated, "skip it" one, or button.
This one did not, and the interaction was planned so there is no opportunity for discussion, until after payment.
Other parts are still running all manner of those little POS terminals and they vary widely.
I recall seeing some places (forget which exactly) where the default options start at 18%. Something like 18, 20 and 25. And this is for a place with no real service I think (you get your food, find your own table and put away your own tray).
What I dislike about a culture of tipping is that in effect it's a transfer of wealth from the generous+agreeable customer to the greedy+disagreeable+shameless customer.
I still advocate tipping since it's a nice thing to do and probably improves your happiness, but I think it's healthier in the context of a no-tipping culture where wages are sufficient and baked into the price of the service.
> What I dislike about a culture of tipping is that in effect it's a transfer of wealth from the generous+agreeable customer to the greedy+disagreeable+shameless customer.
No it’s not. You would not tip any less if you knew there were other people at the restaurant who had no intention of tipping.
It’s strictly a lost potential income to the server when they land a cheap customer. It may not actually cost them anything at all if it’s not busy and they were able to take on the additional customer without losing a potentially higher paying customer slot.
Prices for basic services are lower in tipping cultures, ceteris paribus, since staff wages are a component of price, and staff wages are lower in a tipping culture since they make part of their income from tipping.
Hence, the cheap customer benefits to the maximum in a tipping culture since the prices they're paying are artificially lower as they've been subsidised by tippers. That's why it's a transfer of wealth from the generous to the cheap.
It's got little to do with whether the generous decide to tip more in the presence of the cheap (although that may be a small part of it), it's about the indirect and hidden subsidisation through service price.
This would make for a very interesting academic study, to figure out whether variation in tip size is driven more by personality dimensions (agreeability, generosity, etc) or by socioeconomic status.
Presumably it's a combination of both, where on a diverse platform like Uber it weighs more heavily towards socioeconomic drivers and in a more homogeneous environment like an expensive restaurant it comes down more to personality traits.
> If people aren't willing to do the job for the hourly wage alone with no tips, raise the wage until they are.
Agree with the first part, but would rephrase this second part as:
If people aren't able to live off a minimum wage salary to do the job for the hourly with no tips, raise the minimum wage until they are.
This isn’t an issue people can solve on their own by changing jobs. It’s a systemic problem where the minimum wage has been stagnating for years, while the cost of living has been skyrocketing, and thus felt most by non-knowledge workers.
> If people aren't willing to do the job for the hourly wage alone with no tips, raise the wage until they are.
This would be the case in a normal free market, but unfortunately the labor market is not a free market as people don't have the choice to work or not to work - they need to work to survive.
As long as millions of people are out of a job, there will be millions desperate to work even for under minimum wage, ready to replace anyone who quits.
This is why there are two things needed - first, a minimum wage not defined in dollars (to account for rent and other CoL differences) but in "is enough to rent a decent home in the area and live without a second (or worse, third) job or government assistance programs", and second, a universal basic income that fulfills the same requirement. Only then, when people have the freedom of choice between working or not, will labor prices reflect the true value of the labor.
Anyone can be a waitress or waiter. The labor is inherently low value because it's an easy job. Raising the minimum wage will just subsidize jobs that have less actual value and it will be a net loss to society.
UBI could work because it redistributes the overly concentrated wealth gained from technology from the ultra rich across society. But raising the minimum wage does not.
> Anyone can be a waitress or waiter. The labor is inherently low value because it's an easy job.
Having done a stint in barkeeping myself, it's not an easy job at all and there are many people who aren't cut for it. You have to be resilient enough to deal with all kinds of customers (the "Karen" meme is based in way too much reality) and their issues no matter how you are feeling yourself, it's a job that's quite taxing on your body and honestly it's exhausting.
> Raising the minimum wage will just subsidize jobs that have less actual value and it will be a net loss to society.
That reminds me of "A brief history of corporate whining" (https://i.imgur.com/NBSaqzi.png). When Germany introduced the minimum wage for the first time years ago, we had the same argument, and as expected it turned out to be nothing but whining.
Right now, the taxpayers are subsidizing jobs anyway: 70% (!!!) of SNAP/food stamps or Medicaid recipients work full time, with McDonald's and Walmart being in top spots (https://www.cnbc.com/2020/11/19/walmart-and-mcdonalds-among-...). These companies could also pay their workers a living wage and provide them with medical insurance and still be profitable!
So is picking fruits and vegetables. There is endless labor supply. If one doesn't work out you find another. It doesn't matter how hard people in the business think it is - it requires no credentials or education and there is no bar. That's just reality - I feel for people who have to work in that industry, but that's just life.
Your second argument is just, not a real argument. It ignores why the minimum wage could be raised. Subsidies work when other places of the economy can provide said subsidy. When the rest of the economy starts to suffer the subsidy can no longer be provided and the economy collapses - the USSR is a great example. The economy couldn't sustain itself, it collapsed. Now you want to raise the minimum wage, whenever the fed is pumping billions into the economy. The value of the dollar would plummet and inflation would go out of control.
> Right now, the taxpayers are subsidizing jobs anyway: 70% (!!!) of SNAP/food stamps or Medicaid recipients work full time, with McDonald's and Walmart being in top spots (https://www.cnbc.com/2020/11/19/walmart-and-mcdonalds-among-...). These companies could also pay their workers a living wage and provide them with medical insurance and still be profitable!
The reason this works is because cheap foreign labor/goods can subsidize walmart paying potential higher wages. If, globally, this minimum wage was mandated, walmart would not be able to afford it, no.
> It doesn't matter how hard people in the business think it is - it requires no credentials or education and there is no bar. That's just reality
It is indeed. But still, someone working on a farm full time should be able to live off of that income. If the farm cannot pay a living wage, its products are too cheap. If the farm can't get more for their product because foreign competition undercuts them - well, that is precisely for what tariffs were invented, to protect domestic industries from wage dumping.
You're asking a farmer to be subsidized by everyone else, but you're not saying why we should. Because economically, it's great that the farmer can have a living - not so great for the poor family that can't afford his overpriced produce.
Yeah, I have to object to the OPs tone... maybe it was unintentional. Not only is OP wrong about servers (would you quit your corporate gig if the pay was the same? I 100% would not), but I actually don't want to live in a world without bartenders/servers. I'd hate to have my meals come out of a mailslot, or whatever.
The tone is baseline. You're objecting because you "feel bad about it." We rich westerners like to self loath a lot - a lot of loathing, little action. Of course we all "feel bad" about it. But half the posts in this thread are more "I don't want to tip this server whom I love very much and we need oh so desperately!" Pretty contradictory.
Everyone cares for everyone else, until it's their pocketbook. That's why it's easy to say "raise the minimum wage!", it's just the new "pass the back." No skin off the rich SV developers back, as he types on his $1100 iPhone made with slave labor in china, in his slave labor clothes, etc.
The argument about "would I do this job" is the wrong argument. The argument is, CAN I do this job. And yes I can, and yes, most people can. Most people can not be developers. So why bother with the worthless platitude.
Also to - it is a strawman to suggest I don't want a world without servers. I just suggested that over-subsidizing them is bad for society, as a whole.
No, I was objecting to you saying the job is "easy", which is absolutely wrong and insulting. Also, I simply disagree that these jobs are "low value", ie "I don't want a world without servers". That's was part of an explanation for why I value them, so it's not really a strawman. It wasn't really meant as a core point, or characterization of the other side.
> Most people can not be developers
I don't agree with you there. I'm not 100% sure the numbers, but there's really nothing special about being good at programming. These arrogant attitudes give our profession a terrible reputation, then I have to go back to the real world, and deal with people that assume I'm like you before I even say a word.
No, it's "inherently low value" because most people can do it, and there will always be people desperate enough to do it. In fact they'll do worse jobs for less than a poverty wage, if given the opportunity. We could pack them into tiny boxes and send them underground to die of preventable diseases, then say they owe US money for the privilege. We enact labor laws because we can/have done this and find it distasteful. Being a server is not an "easy job". I wouldn't trade it for my developer job, even if the pay was equal.
The business and customer are getting an excellent deal because the model is anti-competitive and driven by human desperation and inequality. Which is why we have a minimum wage to limit the exploitation. The job isn't easy, and it is an important one. Restaurants for better, but mostly for worse, are staples of our society. They're valuable jobs.
These people are giving up their entire lives basically. All you have is time on this earth, and they're asked to give all of that for nothing, so you can live in the lap of luxury. I don't want to live in a world without bartenders and servers. I consider their work valuable, and think they deserve fair pay.
> No, it's "inherently low value" because most people can do it, and there will always be people desperate enough to do it.
AKA, an easy job. A job that most people can do.
> The business and customer are getting an excellent deal because the model is anti-competitive....
No, they get an excellent deal because they're easy jobs that anyone can do. If being a waiter was like being a mechanic, they'd get paid more. Pretty basic.
> These people are giving up their entire lives basically. All you have is time on this earth, and they're asked to give all of that for nothing, so you can live in the lap of luxury. I don't want to live in a world without bartenders and servers. I consider their work valuable, and think they deserve fair pay.
I hear you - but raising the minimum wage hurts small restaurants a lot. And don't pretend like it doesn't. It will. They'll feel it instantly, and many will fail because of it. It's better to redistribute wealth in other ways. This drastic min. wage hike will just end up being a regressive tax on the poor.
I have the same problem with any "bonuses". Everyone who is paid a bonus inevitably starts thinking about it as part of their income. Banks don't help this as many of them will take bonuses into account when supplying loans. But your employer doesn't think of bonuses this way. Your employer thinks of a bonus as part of your pay they can take away at a moment's notice for any reason at all. Many of them will try to put workers on a lower salary and claim that the bonus makes up for it. Say no to bonuses! Agree what your time is worth and stick to it!
Wouldn't that be the point of bonuses? It's not inappropriate in all cases, if it lets the org pay you more now without committing to do so forever, even if the market turns around. Otherwise you have to deal with painful cuts, or even people losing their jobs. Depends on the circumstances, and I agree it's bad to use as a wage suppression tool. Would you rather not have the money, so it doesn't feel like anything's being "taken away from you"?
Isn’t the whole point of bonuses to make a position more attractive, by offering a possible total compensation that’s higher than would be financially feasible/responsible if it was all guaranteed? So might be a worthwhile trade-off for an employee, depending on their appetite for risk.
Unless you think it’s a scam and most companies could afford to pay you the higher salary but decide not to. I’m not sure that would be very sustainable though.
Consumers / customers should also be on board with this though; there are plenty of experiments in e.g. the service industry with a "no tips" policy, and especially the older generation has problems with it. The same type that will use low/no tips as "punishment", mind you.
Each time I order with Glovo I tipped with cash directly to the driver. The 'online' tip has to be one of the dumbest features ever and just stinks of something shady going on.
I appreciate your comment but it's tangential to the article - in this case it's not really about tips but stealing from people who depend on you, and basically getting away with it.
this is sort of a microcosm of socialism vs capitalism. that being the complex discussion that it is, i think your claim that its a "terrible and stupid system" is far from obviously true, if true at all.
1) its entirely possible and common to make a living wage in the tip system. my wife and i just ran the numbers and she grossed ~17$/hour between her two restaurant tip-based jobs - during COVID with capacity restrictions and lack of patronage (for cost of living reference, our house is ~$125/square foot so we're certainly not in NY or SV).
2) the tip system provides opportunity. it is a way for someone with no skills, education, prospects, or CV to start making steady money. eliminating it increases the risk for hirer as they their hiring cost changes astronomically from ~3$/hr to 10-20$/hr. this will close a window for advancement as taking chances on under-performing employees is more expensive; this results in an increase in heritable wage stratification as another path to the american dream is closed.
3) performance incentives are good by definition. you want all systems to have incentives aligned with the desired outcome. i dont see how removing the incentive structure improves the outcome for anyone except bad servers.
4) restaurants dont get a cut of tips. it is a direct transaction between customer and server (less taxes, obviously). this is the peak of efficiency. by forcing restaurants into being a middleman, you are creating a rent-seeker and lowering real economic output.
5) 2 and 4 make it more dangerous to open a new restaurant. raising the bar for entry into any business scenario is generally undesirable and produces less competition and creativity. less success and more expensive failure.
> its entirely possible and common to make a living wage in the tip system.
It's also entirely possible and common to make a living wage without tips. Most people do.
> the tip system provides opportunity. it is a way for someone with no skills, education, prospects, or CV to start making steady money.
So does every other entry-level or unskilled job. There is nothing magical about tips.
> eliminating it increases the risk for hirer as they their hiring cost changes astronomically from ~3$/hr to 10-20$/hr.
This is not a risk that should be eliminated. It's your job as a business owner to pay your employees. It's not your customer's problem. Every other business that is not a restaurant seems to be able to manage this, there's no reason they shouldn't be able to as well.
> performance incentives are good by definition. you want all systems to have incentives aligned with the desired outcome. i dont see how removing the incentive structure improves the outcome for anyone except bad servers.
Performance incentives should be provided by the employer. If I go to a restaurant, I'm not interested in taking on an unpaid job as a restaurant manager. I just want to eat a meal, not conduct employee performance reviews.
> restaurants dont get a cut of tips. it is a direct transaction between customer and server (less taxes, obviously). this is the peak of efficiency. by forcing restaurants into being a middleman, you are creating a rent-seeker and lowering real economic output.
The restaurant is already a major component of the transaction. The transaction would not even exist if not for the restaurant, why shouldn't they be a part of it? I didn't personally hire some guy off the street to fetch food for me. They're the restaurant's employee.
> 2 and 4 make it more dangerous to open a new restaurant. raising the bar for entry into any business scenario is generally undesirable and produces less competition and creativity. less success and more expensive failure.
It's no more of a bar to entry than any other business that doesn't depend on tips.
I'm kind of intrigued by the opposite idea: extend the system of tips to everything. I'd gladly add a tip to many things I buy if I knew that it would go entirely to the workers and not one penny would go to the owners, managers, or executives.
Tips are a kind of direct income redistribution. If I think someone deserves more money, I can directly give it to them. There's no middleman, no politics, and no stigma about charity.
My understanding is if what you proposed happened it would be regressive as less money would go into unemployment due to the substantially reduced payroll taxes collected.
It's something I wish I could do. It's not a system I would know how to implement. I certainly agree that the existing system of tipping doesn't work very well.
We don't have tipping in Australia but in most cafes, restaurants and bars you can expect good service.
A better thing to fix would be to improve people's general happiness by paying them a dependable wage and giving them good health care - you'll probably find they are happier at work and better at their job.
One of my first jobs, I worked in a private members-only clubhouse where tipping was prohibited. The service was held to a higher standard than most restaurants open to the public. If you didn’t do your job well, you’d no longer have a job.
We were paid quite a bit higher than minimum wage, so we were fine with it. Most people are fine doing their job well for a decent hourly wage.
If you’re the kind of employee that acts out with poor service towards a customer because you’re upset with the wage your employer pays you, then you need to find a job that isn’t customer facing.
You can also incentivize people by firing them when they don't do the job well, as every other industry does. Why are you even hiring people who aren't going to do the job well?
What kind of crappy attitude is that? "I know you hired me and you're paying me and I'm here to do this job, but I'm going to do it really poorly unless you pay me extra"
Do you not find that some people in the service industry do a better job than others, and make your day more pleasant as a result?
> really poorly
Your words, not mine. Obviously if you're consistently terrible at your job you can get fired. But what's the incentive to go above and beyond, vs "good enough"? And how are tips for a server different from an annual performance based bonus for a white collar worker? I don't hear people raging about that one.
Going "above and beyond" is, by definition, unnecessary. The manager / business owner can set the standard of the level of service they expect and then ensure the staff provides it. That is their job, it is not the customer's job.
> and how are tips for a server different from an annual performance based bonus for a white collar worker?
Because the bonus is provided by the employer, not the customer. It's done by someone who is familiar with your work over the course of an entire year and who is much more aware of all the surrounding circumstances, not someone who met you for an hour or two while you were also doing 10 other things they knew nothing about.
It's also subject to all the same labor laws and regulations as a wage. A company can't say "we're not going to give bonuses to black employees" without getting sued out of existence. Any customer can decide they aren't going to tip based on whatever reason, valid or not, that they want. Or no reason at all.
the problem with retail specifically is that you are never paying enough to make that a credible threat. If anything, your staff might just turnover every two years naturally, especially if it's only a part time job. Most retail in an area either is lifer staff or constant churn; in a particularly bad job I had, we turned over entire staff almost in a year.
IME it’s not “no customer service” as much as “less customer service” in many of the non-tip places. The staff checks on you less often and you sometimes have to actively flag them down or end up waiting for quite a while.
For an American who is used to the standard “Drink? —> Order —> Refill —> How’s everything? —> Refill —> Anything else? Dessert? Just the check?” cadence to dining it is strange and may seem like the service is more rude, though I’ve heard from folks unfamiliar with the American style that it’s overbearing, high pressure, and feels like you’re being hustled through the dining process.
If you go through a German hospitality school (yes, actually get some education in customer service), you'll learn the standard there is to give people time to chat and relax, so the delays in interactions in some areas are on purpose.
> The staff checks on you less often and you sometimes have to actively flag them down or end up waiting for quite a while.
What you describe is fairly common in American restaurants where people tip. Between a third to a half of the times I eat out I cannot rely on them checking up on me and I do have to flag them. And waiting is common in about 100% of them.
(And no, I don't think they're doing it only to me because I'm a nasty brat - I've observed this to be normal with the other customers as well).
Good sir, don't believe what you "have heard". Go to Europe and sit down at a Michelin starred restaurant in Italy. Then you will learn what exceptional service means.
My wife and I spent most of 2019 traveling through Europe on a mix of backpacking and remote work, and while there was an adaptation period - American servers interact more with the customer, altho after Europe, it frequently feels pushy and overbearing - the service was, on average, pretty good. Much like in the US, there were places where the service was phenomenal, places where it was average, places where it sucked. There was no common denominator (again, exactly like the US).
This argument always feels weird to me, because most customer-facing jobs in the US aren’t tipped, and most of the people working in them still work hard and try to do a reasonably good job.
Extreme generalisation of 50+ countries, each having own cultural identity and internal/local differences. All from a third party you heard. Are you sure that's information worth spreading / relying on?
(tipping exists in multiple countries in Europe BTW, it's just not that common)
This would be better described as "tips are _intended to_ incentivize doing a job well", as I'm not clear there's a strong relationship between tipping and performance.
That's true in more or less every job, it can be done well or done poorly. Incentive should be keeping the job at all. Tips are an infuriating hidden cost.
There's actually no incentive to keep low paid service jobs for any length of time. One of the saddest things in retail for example is the longer you work, the less you actually make; retail pay is so low that your raises will be less than inflation adjusted minimum wage or new hires if you work at a job long enough!
I've seen/had this happen. Bosses had to go to bat for their long term workers because even with raises, they wound up making less than people hired in the past month.
I don't think it fixes i would say, but more likely people wouldn't waitress for very long then, just like they don't stay at stores or other service positions for every long. Part of the reason tips work is that those restaurants wouldn't pay close to what the servers make otherwise. They'd end up giving them $10 an hour with a 25 cent or 35 cent raise every year.
It's really low. I've worked in a place where people will literally throw away money equalling an hours worth of the wages of a service person into a pool of water for good luck.
Here's what I think the likely outcome would be. High end restaurants that pride themselves on good service would increase their pay to keep good staff. At the very bottom end waitstaff would no longer have to tolerate the worst of their customers behaviour just to scrape by on tips. In the middle you'll see the increased turn over that you predicted.
Do you tip other service positions like the employee that helps you at best buy or the cashier at the grocery store? Why are they different? If people staying in one job longer is a good thing and tipping helps that why wouldn't you?
Why do some jobs in the service industry have tips, and others do not?
I've yet to find someone who pays tips for excellent customer service in the big mall stores. I'm sure they exist, but almost no one does it, and this is acceptable. Why?
Generally you have little to no service interaction in these stores. The people in them are order takers, not sellers; whenever they are pushed to sell, the customer finds it intrusive since normally its value-less or negative products (cough, extended warranties).
There also never is enough staff. The staff doesn't have time to provide customer service in meaningful ways; they more or less clean, stock, cashier, and do everything instead of be dedicated sales people. They literally cannot do so unless its very high value sales where the service is the key to making a big, infrequent sale over many small ones.
BeetleB, Most of that old-style retail is dying out though. The department store model of Sears and Macys lost to the big-box model of walmart and best buy. These days you are lucky if there is enough staff to run the registers in a pinch; big box retail and specialty can be absurdly cheap.
Like the whole gamestop debacle-go into the store and you'll find maybe they have barely enough payroll to have more than one person in the store on non-peak days.
Getting to the discussion at hand: Are they dying because of a lack of tips? It seems their decline is orthogonal to the issue.
Also, as someone pointed out, they typically get paid commissions, but my there are lots of other places where one does get pretty good service without tips or commissions:
> Generally you have little to no service interaction in these stores.
Actually, in stores like Nordstrom, you get a lot more service (if you want it) than at a restaurant - even when you don't want it. I avoided them for years for this reason. They have a fair number of people who spend much much more time providing these services than doing the other stuff you mentioned.
Fair enough. A key difference, of course, is that the commission is well defined compared to the tip, which is left to the whims of the customer.
Getting back to my original question: I often get better service from grocery store workers (depending on the chain, of course), than I do from restaurant workers. Yet no one pays them a tip. Same goes for Costco employees. Often the worker at the REI store will spend an inordinate amount of time helping me. No one pays them a tip, and they don't get a commission. From my perspective, all of these people are actually providing a service to me that I actually want, when I want it. Whereas with waiters, they are typically forced upon me. It's usually the exception that I want some service that requires a waiter.
The point being: There are more ways than tips to build a culture of good service, and it's inane to think tips are needed to maintain quality.
In my experience the only thing it sometimes successfully incentivizes is getting preferential treatment at a bar/restaurant...not saying that's a good thing, just a personal observation
I have a few friends in the service industry who prefer the tips model since the tips are often 200-300% of their base pay. If it switched to fixed hourly pay, they'd be taking a pay cut since there is no way their hourly pay would be $30/hr.
As for cost of living, my first job was doing 20 hour weeks at a McDonald's as a teenager. It paid enough for me to live very comfortably just 5 minutes outside of a major city (>1mil population). Obviously that's not too relevant to the tipping discussion since fast food workers aren't typically going to get tipped anywhere, but it serves as a demonstration of the living conditions a developed country should be able to provide, and tipping is entirely non-existent here so it's clearly not necessary to ensure that those working in service industries are fairly compensated.
The amount of Americans I see casually mentioning that they need to work multiple jobs scares the crap out of me.
Um..medium hourly income in the USA is $21 an hour or so. I live in a decently expensive state and skilled trades, managers, and various lower-tier technical people make $30 an hour, and that's double the state's upcoming minimum wage.
But they're apparently already getting paid that much! Either people are drastically misrepresenting how much waitstaff take home in tips, or there's enough money in the economy to pay them that much.
I don't think they are getting paid that much. I think in general people exaggerate. Maybe at peak times it hits $30 an hour, but a lot of the week it can be dead or slow.
This is part of why we don't make sales based on commission in retail stores any more; usually sales in general aren't boing to be affected by service as much as volume of customers into the store. Same I bet w tips
It is a difference in who decides how much they’re paid. In a traditional business their pay is at the discretion of the business and thus in competition with what could be the business’s profits. Tips are inaccessible to the business, so they get paid more closely to what consumers are ok with paying. I’m probably paying more too because of being guilted into feeling like I must tip x% because I’m directly responsible for the person’s wages.
These two points mean there’s no guarantee a tipped wage would convert 1:1 into an hourly wage if we simply removed tipping, even if the value provided by the tipped employee stays constant.
> It is a difference in who decides how much they’re paid. In a traditional business their pay is at the discretion of the business and thus in competition with what could be the business’s profits.
I don't really see how this is any different to me going into an American restaurant today and having the waiter's pay be at the discretion of myself, and in competition with what could be my money. At the end of the day it's still a person deciding how much money to give the waiter, knowing that they can keep any that's left over.
> I’m probably paying more too because of being guilted into feeling like I must tip x% because I’m directly responsible for the person’s wages.
Entirely plausible, but I see eliminating this consequence of tipping to be a huge positive. If a significant portion of someone's pay relies on guilt, then clearly the actual service they're providing isn't worth what they're being compensated for.
You guys understand that the price of meals would go up to compensate for the lack of tipping right? You’re not simply removing the cash. That extra 20% or whatever is now baked into the price. And generous tippers can still leave their extra bit.
The change is, that by default everyone earns a fair wage.
you know that the actual minimum wage of someone who makes $30 or more in tips a month is $2.13 right? By law, if they don't make enough tips in a week to earn an effective wage of $7.25 an hour, the employer has to pay them that much.
this is all the employer actually has to pay. Everything else is the customer. Now imagine the employer has to pay $15 an hour. Thats 6+ times what they pay now if its a decently busy place.
You still think it's going to be baked into the price?
So...they put the prices up by 20% or whatever. By definition, the amount they'd raise would be enough to pay the staff the equivalent to the amount lost in tips. They don't need to maintain the same GP margin, as this is pure extra revenue.
I don't understand your confusion. The amount of money the customer pays doesn't change.
I'll give an example:
$8 item + $4 (50%) tip = $12
$10 item + $2 (20%) tip = $12
$12 item + $0 (0%) tip = $12
In any scenario, the wait staff's pay comes from the customer. All we are doing is, setting the price, such that you no longer calculate the tip. If the actual price doesn't actually change, you can bake in whatever you want.
Wait, if the employee gets their min wage covered by tips the employer pays less? That's even shadier than I thought. Is this in law? Wasn't a delivery company booed for that kind of behavior a while ago?
I think the experience is very different depending on where you work. Your friends are probably working at a relatively fancy restaurant or bar. There's no reason a place like that couldn't pay more to keep good staff if tipping went away. How many of your friends would want to work for tips if they were working at a diner in a small town?
Not sure why you're being downvoted, but this is absolutely true. Nobody likes tipping culture more than career waiters and bartenders. People are more inclined to part with their money when they can see the face who receiving it. This may not apply for online deliveries though.
I'm sure famously low margin, high risk places like restaurants can easily raise employee wages anywhere form 2 to 6 fold. As I said downthread, all a restaurant has to pay is $2.13 an hour if they make enough tips to earn an effective wage of over $7.25 an hr in a week. That's $290 a week for 40 hours of work pretax.
For a tech comparison look at Amazon's Mechanical Turk. It probably is closer to the $2.13 minimum wage in practice than the $7.25 one for what I hear. Now imagine they had to raise what they paid to make sure its an effective $15 an hour based on spending an hour.
You think it would still exist? Would you pay that much? Or is it's value proposition precisely because you can pay them shit wages overall?
Seven US states do not allow tips to count towards the minimum wage. These places, as far as I know, still have restaurants. Not to mention most of the rest of the world.
Figure out what your expenses are, and make sure you charge enough to cover them, plus profit. If you can't manage to do that you shouldn't be running a restaurant or any other business. It's not rocket science.
To be clear, in California the tipped minimum wage is at least $13/hr state wide (and $14/hr for businesses with 25 employees or more). I believe in San Francisco, it’s also just strictly the same as minimum wage of $16.07/hr (and again for larger businesses, Healthy SF medical coverage is also mandatory [Edit: actually, providing coverage is, not Healthy SF, that’s just the cheapest coverage and so very common], and usually passed onto patrons as a 4% fee on their bill, though this isn’t dictated by statute).
So your universe already exists: every restaurant in the state of California already ensures a minimum wage more than 6x the federal minimum.
I don't think Healthy SF coverage is mandatory. From what I've read, businesses have two other options: provide a regular healthcare plan, or set aside a fund to reimburse employee healthcare costs as they arise. Restaurants usually go for that last option.
"usually passed onto patrons as a 4% fee on their bill, though this isn’t dictated by statute"
I find the last part of what you wrote interesting. It's true that this isn't dictated by statute. But it would be surprising and unusual for a statue to dictate that a business must make its customers pay a specific business cost.
Of course, there are instances where businesses are responsible for collecting taxes from their customers (notably sales taxes and recycling fees) but these are explicitly taxes on consumers that the business is collecting for the government's convenience, not taxes on the business that the business is tricking consumers into paying, by making them believe they're responsible for them.
No. They just have to spend at least a certain amount. They don't have to spend more than that, even if employees need more due to their specific health needs.
Good point, I updated my comment with an edit: Healthy SF isn’t mandated, providing health care is (and the very limited Healthy SF coverage is basically the cheapest option, so most restaurants do that).
On the “dictated by statute”, I actually mentioned that because so many people figured it was! Much like sales tax, it’s often on the bill as if it’s a thing that the city has specified and that it was a city program (rather than the city mandating that larger businesses provide coverage). Many restaurants are quite clear about it “we use this money to pay for healthcare for our workers”, but the biggest surprise for me was that the “market rate” ended up settling at about 4%. When some restaurants instead do an $X/patron or $Y/ticket add on, it catches people by surprise.
Either way, I find it amusing what people are “willing” to pay for things, especially if we can get closer to living wages for everyone. (I’m all for more “taxes” on bills that somehow people prefer over menu items going up in price).
"and the very limited Healthy SF coverage is basically the cheapest option, so most restaurants do that"
If someone works only a few hours per week, the 'Healthy SF' coverage can cost more than the minimum employer spend. So it's not always the cheapest option.
I didn’t know about this anecdote before, but apparently Alan Krueger of minimum wage study fame had an interesting follow up: shouldn’t the federal minimum wage be too high somewhere? What about Puerto Rico?
Apparently, he didn’t find evidence to suggest a strong effect there. But it’s got me curious to follow up with other territory or county vs state differences in the data. My suspicion is that the current very low minimum wages are just too low to see effects anyway, but that a federal $15/hr would be enough of a jump to see many county-level area median wages suddenly tip over.
Eh, service in Australia is generally not particularly great. This is often a function of staffing though, since wages are expensive (national minimum wage $19.84/hr) and many Australian restaurants consequently either operate with a skeleton staff, pay under the table (migrants/students are brutally exploited), or both.
Japan, on the other hand, has incredible service and absolutely no tips.
> We pay our wait staff fair and reasonable rates (legally mandated btw).
Most people I know in Melbourne who worked in restaurants said they got less than minimum wage with cash in hand. Almost all these people were on a working holiday visa or students.
Yeesh. I should've said that it was tried in the US and didn't catch on. Not having a tipping culture to begin with is great, but the hard part is to switch from tipping to not tipping without legislating it.
Never having a tipping culture is a much different thing than having to transition from one that tips to one that does not. Did Australia have tips then do away with them at some point? If so, how did they pull it off?
France used to have tips, which became a service fee, and is now transparent in the final price.
Interestingly waiters tend to ask Americans for tips in France, while they don’t expect anything from Europeans, that’s because American tourists tip when they travel there.
Then it needs to be mandated at a federal level. All people see is a difference in the advertised prices, while they likely would be paying the same on the final bill.
I don’t think you’ve worked a job where you got tipped, have you?
It’s actually one of the few ways people can make a lot of money for doing a good job. What you describe punishes hard work, the people getting tips would hate it.
Most of the information I've read about this says that tips do not correlate with job performance. Instead, things like race, sex, attractiveness, and other things have a bigger impact. I've even caught myself doing this, where I'll realize after the fact that the only reason I tipped extra was because I noticed the worker was either a very attractive woman/man. It's not even sexual attraction since I'm not attracted to men. My guess is that I'm more likely to notice good service if I first notice the server, which happens more when they are attractive.
It's likely similar to that bias where attractive people also progress faster in jobs. Even if you're not personally attracted to them, you still have that bias.
My PM doesn’t tip me when I complete a ticket quickly; I don’t tip QA when they catch a bug in my code; the on-call engineer doesn’t tip me when some docs I wrote save them a few hours of time fixing an issue I saw during my last on-call rotation. And yet! The company seems to keep making money and doing well, and we all seem to like each other (mostly, except for that one guy, but he doesn’t like anyone).
tip based jobs are overwhelmingly minimum wage. of course we can argue whether that’s cause or effect, but the point is, it makes very little sense to compare literally “the minimum allowable threshold for legal employment” to professional salaried employees.
It makes all the sense because a common argument in favor of tipping is “it improves service” or that it “rewards good service”.
In reality, it’s a gesture of pity for those who earn little, and who we don’t want to pay properly via decent wage regulations and increase product prices, but we want them to dance for us and have them hope we will toss a few coins their way. In the process, we get to feel good like benevolent dictators who have chosen to be generous and share their wealth.
Apart from other responses pretty much disproving this, consider which people you're rewarding. Not every place will share the tips with cooks / dish washers / owners / etc. It actually causes conflicts in those places (don't share -> kitchen hates front staff; share -> front staff hates kitchen).
> The people who steal the difference between a living wage and a tip-subsidized wage?
The people who could "steal the difference" are usually the owners, right? Not sure why GP put the owners and kitchen staff in the same bucket.
From my experience as a client in bars (without actual kitchens) in Paris, France, where tipping "isn't expected but kinda is" [0], most of the time tips are split between wait staff. So I kind of get the issue that if some waiter is going above and beyond and is nice / helpful / quick to serve / etc, whereas a colleague will do the bare minimum, when someone tips, this is diluted.
As a client, I'm tipping X for the service, but this particular waiter will only get a fraction of that, the same as his low-effort colleague. I'm not really OK with that.
Most places I usually go are rather small and the waiters seem comparable, so I guess it's not usually an issue I have in practice.
However, there are other, usually larger places where quality of service varies much more, and I'm usually much less inclined to tip in those places. I've also heard from bar staff having worked in such places that there indeed is more tension between staff, along the lines of "so and so just waits around / doesn't do anything". Wouldn't be surprised that the complainer wouldn't be all too happy to split their tips in such a case.
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[0] Technically, in France, prices are "all-inclusive", that means service is already included in the price, so you don't have to tip. However, at least in bars around Paris, I've noticed that it's somewhat expected to get a tip, especially when clients are considered "difficult" (though I'm unable to exactly quantify that).
> Not sure why GP put the owners and kitchen staff in the same bucket.
Because the parent was talking about rewarding good job. The kitchen staff and the owners are both a factor in your good time and invisible during that time. If that's a honest opinion about the purpose of tips, then I don't see why owners/managers shouldn't share the pool. They run the place, created the environment, hired the people interacting with you. Then there are managers who deal with day-to-day issues in the place, right?
But that's not true of course - it's about owners not paying people properly.
Many do, many don't, and changes are interesting. I've seen the reaction of front staff being told kitchen will share their tips - let's say they were not happy.
Agree, thanks to the tipping culture I can sit in a restaurant with my friends and be asked every 5min if everything is good. Then at the end I can decide how much they will make from me, nothing or a bunch? Maybe I’ll discriminate and judge how much they deserve based on how they look.
What about the customers just in a bad mood taking it out on you? What about the restaurants that pay sub-minimimum wage before tips? (basically a tax dodge.)
I'm not saying all bonus-based comp is bad, but it's rather out of place for nominally unskilled labor especially when it is a huge portion of total comp.
The fact of the matter is the economics of much restaurant work it totally wack.
I look forward to a cyberchill future of near-fully-automated cheaper-than-cooking-at-home not-cooked-to-order restaurants with an owner-masterchef as the only human in the operations.
This isn’t every restaurant though. My ex-wife used to be a waitress and if there was a pooled tip jar she immediately began looking for a different place without one. Drivers, otoh, usually make at least minimum wage but then they need that money for gas as well.
If your wife is broadly viewed as attractive and working in the half of employees at her business which interacts with the public she may benefit more than average from tips which provides a poor justification for making a decision if the broad welfare of all employees in tipped industries is concerned.
In any situation where the following benefits accrue
A: 80
B: 80
C: 80
A would logically prefer a situation where the following benefits accrue even with total outcomes being on average worse because A is logically and understandably primarily interested in their own well being.
A: 100
B: 50
C: 50
Tips are better for the employer because they fan advertise a price n where the customer will be expected to pay n+10-25%
Pooled tips are better on average because the extra tax the employer is able to levy accrues to everyone. Non pooled tips are better for attractive people or those who are much more competent than their peers.
No tips and actually paying employees what they are worth is even better.
>No tips and actually paying employees what they are worth is even better.
There's plenty of resistance from the servers themselves, though. Whenever this subject comes up on kitchen-pros related subreddits, IIRC this just came up not too long ago (/r/kitchenconfidentials, I think?) servers don't want to take straight wages over tips. I always think qualifiers like "better" doesn't mean better for everyone. Some servers make so much in tips, or think they can exceed their straight wages in tips, that they believe the current system favors them. Much like the majority of SWEs on HN are vociferously resistant to the idea of a SWE union.
-Incentivize doing your job. I don't expect anything crazy and give 20% as long as you did the baseline properly. If you can't be assed to read or follow a two sentence delivery instruction that says how to find me then I'm not rewarding that.
-Result in taking home much more money than otherwise in many cases, else the company still has to make up the difference to minimum wage but that almost never happens in practice
-Let lower income people keep more of their pay, if cash
I really see no compelling argument for eliminating it. If multiplying a two digit number by 2, rounding, and moving a decimal is too hard, we all have calculators in our pockets all day.
What about the argument that lets people in the higher income bracket have greater control on whether the lower wage workers will be able to afford rent that month based on their own whims?
> The FTC alleges Amazon changed the way it paid drivers in late 2016, lowering the hourly rate and then used customer tips to make up the difference. Amazon continued to tell drivers they were receiving all of their tips, even after receiving hundreds of complaints from drivers, the agency said.
How is this not simply theft? Why does this attract civil charges and not criminal ones?
> when Amazon steals $62 million from its employees it's "misrepresenting drivers' tips", when Amazon employees steal $130,000 of products from Amazon it's a "theft ring"
It’s not considered a big crime because crime is largely a social construct. For example the news is happy to hype stories about recurring car break ins, but is then quiet about wage theft and other white collar crimes.
Wage theft comprises, by some estimates, about 75% of all theft in the United States each year[1]. A brief perusal of television news or newspapers in any city in this country will make it immediately apparent that the crime that corporate media likes to focus on is very much not wage theft.
The FTC uses flimsy words like "did not disclose":
In late 2016, the FTC alleges, Amazon shifted from paying drivers the promised rate of $18–25 per hour plus the full amount of customer tips to paying drivers a lower hourly rate, a shift that it did not disclose to drivers. Amazon used the customer tips to make up the difference between the new lower hourly rate and the promised rate. This resulted in drivers’ being shorted more than $61.7 million in tips.
Which of course isn't flimsy, they are saying that Amazon did not pay wages they had agreed to.
> they played with words to make people think one thing instead of another
Is that not essentially the definition of fraud though? That they’re being forced to pay it back seems like their “interpretation” here was dead off — they lost the case, right?
Not arguing one way or other, but for many, say, restaurant workers, this practice is the norm in states that allow it (I believe that would be most states). The amount the owner is required to pay a worker is pretty low, as long as they have enough tips to hit the standard minimum wage.
In a typical restaurant job, the stated wage is the legal minimum for a tipped role, and then (in theory anyway), the restaurant is required to ensure that the employee receives the normal minimum wage if they don't get tipped enough to average at least that much.
So the difference seems to be that Amazon said they'd pay a certain amount and then paid less than that.
Didn't Instacart get in trouble for a similar thing? I believe they said drivers would get 100% of their tips which was technically "true", however they were using the tips as part of their minimum pay and if the tips weren't enough to hit that guaranteed rate they would top it up to that rate. It's overall a super sketchy practice. When someone sees an offer for "Work this block of time for 15/hr" they assume 15/hr + tips on top, not that they will pay you for an order + tips, and if that meets the $15 they give you nothing extra. It's a slimey practice and it looks like this is two big companies getting in trouble for it.
This gig work stuff really needs to be more regulated because clearly these big corporations treat their employees like slaves and exploit them and do not self regulate at all.
I don't disagree about the "saying one thing and doing something else" part. I was commenting on the general principle of lowering one's wages (even to below minimum wages) if the person gets enough tips, and how common that is.
It's kind of just semantics, but the thought is that tips don't commonly reduce wages, wages stay the same and tips remove the responsibility for the restaurant to ensure that average hourly pay is meeting the general minimum wage.
Another way to put it is that the tips don't normally change the wage structure, which is exactly what Amazon did.
I hear you, I'm not sure how useful this is as a comparison though; plenty of things are fine and dandy if you're upfront that you're doing it and gain agreement from the other party, and illegal if you conceal that you're doing and don't get agreement.
