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Hey Big Tipper
Any discussion of service should eventually consider the subject of tipping. Is the act of leaving a tip for a service employee a form of tax or is it a moment of altruism? Do you as a buyer of services expect to find a linear relationship between the size of your tip and the amount of service delivered or do you just automatically do the math in your head and write it on the bill?
As a lifelong student at the School of Hard Knocks- College of Food Service I can tell you that it is a subject of much discussion, infinite aggravation and a huge component of overall income earned. Of course, tipping is utilized in many service industries besides food service. Taxicabs, hotels, hairdressers and tour guides come to mind. Since my experience is most with food service, I will confine this discussion to one topic: Why don’t we just eliminate tipping and add the full cost of running the business and paying a living wage to the menu prices?
Tipping is deeply embedded as a cultural thing. Tipping came to the U.S. in the 18th century from Europe and has been a cause of friction ever since. The NY Times published an editorial on 1897 that called tipping the “vilest of imported vices”. By 1915 six U.S. states had abolished tipping as a form of extortion. Stingy tippers can be a considerable source of stress to servers which occasionally leads to an altercation.
In modern times the cultural expectation of tipping leads us as a country to tip to the tune of $40 billion per year to a total food server group of 2.5 million workers. I did that math on that and got an average tip income of $16,000 annually which makes sense based on my experience. In some states where employers are allowed to count tips as part of the minimum wage (tip credit) the tips will substantially exceed the money paid by the employer. In states like Minnesota where I live tip credit is not allowed so that servers are paid a higher minimum wage (currently just under $10 /hour) and collect tips as well so that a good server can easily clear $20 to $25 per hour in combined income. That’s enough to support oneself in reasonable comfort, i.e., a living wage. Menu prices reflect the higher cost. If one traveled from Texas to Minnesota and bought the same meal at an Outback Steakhouse in both places the cost of labor shows up as $1.00 to $2.00 per plate more for the same item.
Should restaurateurs just leave things as they are or should they campaign to eliminate tipping and pay all the staff a living wage? In Manhattan restaurant titan Danny Meyers, owner of Union Square Hospitality Group, has embarked on a mission to do so. Over the past 2 years or so he has converted a bit at a time his 20+ high end restaurants. Meyers is also the creator of Shake Shack and reasons that if Shack can make it work on $5.00 burgers, he should be able to work out the economics on $100 plates of food. Meyers high end restaurants had to increase menu prices by 21% in order to eliminate tipping and pay the service staff what they need to make. So far it seems that Meyers customers have accepted the change and even embrace it. On the other hand, recently national chain Joe’s Crab Shack experimented with eliminating tips in a few of their locations. They found that online service scores decreased dramatically and they scuttled the experiment.
It turns out that expectations have a tremendous influence on overall customer satisfaction and server performance. Research at Cornell has shown that even though tip generosity is poorly correlated with service quality (people seem to tip out of habit and convention) the servers thought the correlation to be strong and therefor behaved as though their income depended on their performance. They worked harder for their customers. Not a bad result.
Additionally, customers as a group were happier with a tipping environment. Customers expect service to be better in a tipping situation and that can bias their perceptions. Most people still believe in the power of incentive.
So which way for the future? Mrs. Chef, who has worked for tips her entire career, is a notorious over tipper. She strongly believes in karma, at least where tips are concerned, and expects that she will reap as she has sown. I have learned just not to look when she is in charge of the tip. I myself am a little stingier, although I almost always leave 15% or better and feel bad about leaving only 10% for really crap service when 0% was earned.
What say you? Would you prefer a “service included” model or do you like things as they are?
(Hat tip to Stephen Dubner at the Freakonomics Podcast for some of the data I quoted here.)
Published in Group Writing
Probably not but I wouldn’t mind it.
Is the term “a stiff” still in vogue? I’m way out of the loop but that was our gentle term for these types.
I’m out of the loop too but that’s the term I would use if I got shorted on a tip. Although now that I think about it, that’s probably because of Caddyshack.
I’m thinking there’s room here for a thread on best bartender/server stories. I’ll save my best stuff for that.
Yes I tip. Round up to nearest dollar, and the. 20%.
I have talked to many many wait staff and the people who tip best are the most hated ethnic group and sex in America today. You know, the ones who are to blame for everything bad.
Go figure.
Honestly, I tend to view tipping as an insurance policy against malicious alterations to the food-its an OCD thing. The type of service that would cause me to not tip would be tantamount to service that would get a waiter fired.
I prefer the model just the way it is.
Neither. It’s part of the bill that is left to a customer discretion. You’re paying for the service.
Roughly a linear relationship with a sort of base amount for standard service. I tip generously if I feel the person is deserving. He/she worked for it.
Yes, I would hope the tip got shared to the bottom of the ladder. I’m tipping for the team work, not just the single individual server. The experience would be horrible of the cook did a terrible job but the waitress was super.
Yes. It’s good to make someone’s day.
I do too. Those are some of the neediest people. At least they look needy to me.
Well, I haven’t figured out yet what I’ll tip the coroner when I’m dead. I’ll leave it for others to figure out. :-P
At the other end, I’m a bit irked by the new credit card tipping options, often done on tablet devices, where the computer basically sets your tip levels, and sometimes starts your options at 15 percent (where 20-22 percent is listed as the mid-range option box you can check). It still leaves the customer with the option of whether or not to tip, but does take away the option to leave a limited tip, when service is below-par, but not to the point of leaving no tip at all.
Exactly, that’s the funeral director’s problem.
I just happen to be privy to the problems of funeral directors.
No, insofar as treatment of customers, especially in today’s world of Yelp revenge reviews. Yes, insofar as the place was in D.C., so throwing things at government employees would likely be understood and sympathized with by the rest of the country.
“Tip out” and “Tip back” schemes assume that more than the person interacting with the customer provides the service acknowledged in the tip. This happens with bars as well, where the bartender might tip out to the server and back to the bar back/ kitchen staff, if I understand the scheme rightly.
Where I worked the servers tended to tip out busters, food-runners, and bartenders. But I suppose the dynamic can work in a number of ways.
Well, if you are putting coins on the departed’s eyes, you are obviously paying for service of some sort.
Food or drink: 20% or don’t show up and act like you can afford to dine out.
I only know this because a woman from Long Island came and worked for the family funeral home for a few months. She made it sound like it was just business as usual, like the way I tipped out food-runners when I was a server – and especially if I wanted them to pay special attention to my tables…
Gotta pay the ferryman.
In my lifetime, the percentage that one is “expected” to tip has gone from 10% (in my youth), to 15% (middle-age), to 20% (last 15 years or so).
Also, the number of people that one is “expected” to tip has grown. I’m sometimes confused nowadays about whether, for instance, I’m expected to tip a person who scoops up your ice cream in an ice cream store.
I prefer Europe and Asia, where one is not expected to tip. It just makes things easier and less stressful. If I’m not mistaken, businesses pay wages there that assume their employees will not receive tips.
Thomas Sowell said something to the effect if you think you are getting good service because the waiter is concerned about your well being, you are probably mistaken. When I worked and went out to lunch with a co worker years ago, we always seemed to get bad service, and we tipped well we thought. She said one day that it seemed the waitresses paid more attention to the men and theorized men were better tippers. Think that is true? I am sure those that work in any service business size up customers fast.
Resturant work is hard work. In our local resturants there are servers who have been there forever it seems, and we like to see them as old freinds even though we don’t socialize.
As the laws change, we have also reduced our tips to kind of even it out. It may seem mean, but we noticed that resturants have raised prices, and there is only so much we can pay for a meal, and sometimes when we are tired after work, we just want to get home at a decent time, and either pick up something, or make something quick at home.
Best service I have ever received was in Kyoto and Seoul, two cities where tipping is unheard of. A driver who spent four days ferrying us around, from pickup in Kobe to Kyoto to Kansai airport, vigorously refused the $100 I offered him. Would not hear of it.
Culture always wins.
I bartend 2 nights a week, and without the tip income, that job is not worth the trouble. Dealing with drunks without resorting to murder is not the easiest thing in the world. Especially during the holiday season, when the amateurs come out to play.
Anyway, I don’t go out all that much, but when I do, I tip like a baller. It’s a fairly cheap way to really improve somebody else’s evening, and the server will likely treat the next 3 guests a little better as a result. Everybody wins. Plus, I have to get into heaven somehow.
I loathe the custom of tipping. I’d vote for any candidate running on the abolish-tipping platform.
I always (well, nearly) tip 20% for table service. But I am confused by take-out (pickup from a table service restaurant, not delivery) because there is no table service or clean-up involved. Having no history in food service I don’t know the economics for the food preparers as opposed to the wait and bus staff. I’ll generally kick in a couple of bucks but never know the expectations or protocol. (I do know that no one is going to turn down a tip even if it is unexpected.)
I leave $3-5 dollars/day for hotel housekeeping when on trips, with a note saying “Thanks!” so they know it is not just some money laying about.
They do have to be careful playing the game, that’s for sure . . .
It’s like when my wife had her S corporation. She had to read up on what salary to assign herself so she wouldn’t trip any IRS red flags.
I try to tip at least 20%, but if the service is lousy, I will reduce it to round up to next dollar plus 10%. I prefer to leave cash. I tip my hairdresser – on a $17 haircut, it’s usually around $5. I don’t tip housekeepers because we always request no housekeeping. We are pretty tidy (even taking out some of our own garbage – pizza boxes, etc), so even when we leave, there is just the usual getting the room ready for the next occupants.
My father-in-law was the lousiest tipper I’ve ever seen. Once when we went out for a family dinner – seven of us – he tipped $5 (!). I went back and put some more money on the table, and after that would always make sure I had some cash ready to enhance his tip. When he caught me doing this one time, he was a little perturbed that I questioned his worldliness and ability to leave the proper tip.
I never know how restaurants allow their staff to keep the tips – do the servers share with others? When the server takes my order, but then someone else brings the food, and someone else brings the drinks, do I assume the tips are being shared? I feel kind of silly tipping 20% when the only time I saw the server was to take our order, check to see if everything was ok, and give us the bill. Hopefully everyone gets a little.
Yes, I have learned that when leaving a tip for hotel housekeeping I need to leave a note so they know that it is for them.
I audit worker’s compensation insurance where premium is charged based on payroll. Tips are deducted from total payroll at 1/3 of total.
Don’t really have much else to add other than that I’m always confused by tipping. We need some universal guidelines. I have always tipped restaurants, but I’m not tipping the guy who gave me a slice of pizza that was sitting on a rack. “Tip creep” is real and some of the professions it’s worked itself into are puzzling.