Eliminate Tipping

[Cobra9777]

I'm a very generous tipper for good service, but I have to admit, I dislike the whole culture of tipping. There are so many ambiguous situations and differing practices. I lived in Asia for 3 years where tipping is considered an insult, yet that's where I consistently got the best service. Now that I'm retired, when I travel internationally, I have to research tipping customs in every country I plan to visit and then, upon landing, immediately arm myself with appropriate denominations of local currency. Not a huge deal, just one more distraction I'd prefer to not have while traveling. Tipping practices in Europe vary widely by country and type of service provider. To make matters worse, North Americans seem to have exported their tipping customs into touristy areas of many countries where tipping is otherwise not common. So, am I supposed to tip the bellhop at the Sheraton in Shanghai? I have no earthly idea. I run the risk of insulting him either way. Cruise ships are even more baffling, especially for people from countries where tipping is taboo.

It really is an obsolete form of compensation that is confusing at best, discriminatory at worst, and I would argue, largely uncorrelated to quality of service. I think Yelp has done more to improve customer service levels in its 10-year existence than centuries of tipping. And, for all you AUM fee critics, why do I tip more for a steak and a glass of wine than a hamburger and glass of water, if the actual service was exactly the same? Studies have shown that the amount people tip is primarily related to the amount of the bill, not the quality of service.

I was a restaurant manager for a few years in between undergrad and grad school. So I am quite familiar with many of the finer points of this issue, pro and con, and even the ugly discriminatory practices that no one likes to talk about. Today, when I get poor service at a restaurant, it's almost always due to inadequate staffing or other operational issues that are the responsibility of management. If the server did their best, despite these other issues, I still give them a great tip. But I go home and tell management exactly what I think on Yelp. I once read that each star in a Yelp rating is worth as much as 9% of sales. Trust me, restaurant managers and their bosses read every word that's posted on Yelp. IMO, this is far more effective at improving service than stiffing a server who was working harder than ever in an under-staffed environment.

[Sunset]

I knew one fellow in IT, his wife worked as a waitress at a normal chain restaurant, he told me she made more money than he did, she was paid minimum wage plus tips.

Personally I dislike the tipping because of the offloading of paying staff to the customers, its like other low wage jobs where the tax payer gets to support the workers at various companies via food stamps, etc. even if I don't get anything from that low paying company.

I can easily see the discrimination in tipping, that explains the crop tops and short skirts at some places. Do pretty servers get more tips than the ugly ones ?

I made up my own rule for Buffets, since I'm doing a lot of the work, I now only tip 10% max at buffets, and regular restaurants I tip 20% max (before tax as I'm not going to tip the IRS).

I never tip for take out, but I would if it was being delivered.

[Midpack]

Quote:

Originally Posted by utrecht How about you pay all the waiters a decent salary and they all make the same amount of money. No more tipping allowed.

Quote:

Originally Posted by Texas Proud but the reality of it is that they do not get paid well and it can be hard to get good workers...

While there are certainly many good servers who are not well paid, these are sweeping generalizations.

A truly good, or even half decent server in an upscale restaurant can make a very good living, without any advanced education. I worked in a moderately high end restaurant the last summer before I graduated college, and I made more per month in that restaurant than I was making as a Process Engineer for the first few years starting out. Yes, I did better $ in the long run, but there are also some really high end servers (much more talented than I was as a server) who take home six-figures nowadays - guaranteed. And if you asked truly professional career servers what they think about eliminating tipping, I suspect they'd be overwhelmingly opposed...

And between those who are not well paid, and the top end six figure servers, there's a whole continuum of folks who are fairly or even well paid for the service they provide. Like most professions...

[audreyh1]

Quote:

Originally Posted by Midpack While there are many good servers who are not well paid, these are sweeping generalizations. A truly good, or even half decent server in an upscale restaurant can make a very good living, with nothing more than a high school degree. I worked in a moderately high end restaurant the last summer before I graduated college, and I made more per month in that restaurant than I was making as a Process Engineer for the first few years starting out. Yes, I did better in the long run, but there are also some really high end servers (much more talented than I was as a server) who take home six-figures nowadays - guaranteed.

Yep.

Although you probably have to go to a high end restaurant to enjoy that level of service.

[marko]

Quote:

Originally Posted by fh2000 My cousin asked me how much extra we pay for a meal in a restaurant in US. Well, that amounts to 9.5% tax and another 15% tip, so about 25% more than he pays from back home.

I suspect you're paying for it, it's just built into the cost of the meal. And then there's the VAT.

I've lived in Europe for several years and really couldn't tell the difference in performance between European waiters who were on a salary of sorts vs professional waiters in the US who relied on tips; at least in the higher end places.

[retirementguy1]

I worked as a waiter in Las Vegas for the last ten years. I would have loved it if 18% gratuity was included with every check. The vast majority of foreigners only leave 10%. This is also very common for military personnel. Most people also don't realize that the server has to tip out bartenders, sommeliers, bar backs, food runners and bussers.


There was one restaurant I worked at where the mandatory tip out was 10% of sales. So if someone tipped 10% I basically worked for free. There was one instance where I had a $400 check and the guy didn't leave a tip at all. I still had to tip out $40!!!!!


Also, 6 figure incomes in food service are extremely rare and they are also in high COL areas. Secondly servers are really horrible with money. The moment they got a job like that they would buy a $60k Mercedes. The lifestyle is not very conducive to FIRE.

[Midpack]

Quote:

Originally Posted by retirementguy1 There was one restaurant I worked at where the mandatory tip out was 10% of sales. So if someone tipped 10% I basically worked for free. There was one instance where I had a $400 check and the guy didn't leave a tip at all. I still had to tip out $40!!!!!

As I noted earlier, tip pooling is another matter, and evidently more and more restaurants are abusing the practice (I was never forced to pool tips, though I often did so voluntarily). More of us might agree on that, and that would begin to help servers...

And I assume 99%+ of diners have no idea which restaurants they frequent use/abuse tip pooling. Though turnover would be one of the telltale signs.

[Philliefan33]

There's another variable I haven't seen mentioned yet. Not all servers make minimum wage. In PA, a couple of years ago, my danger was paid $2.35 per hour by the restaurant. She had to share tips with the bartender/busboys/runners. Most shifts she was able to average $10/hour but not always.

Compare that to a cousin who was working as a server in OR at the same time. She got paid minimum wage, which was $10.xx per hour. Then she got tips on top of that. The aunts and uncles were shocked to learned that my D was only paid $2.xx an hour.

[mickeyd]

To eliminate the need for tipping the business owner only needs to increase his posted price by 15-20%, pass it all on to the employees and post sign "Tipping not Allowed".

[Midpack]

Quote:

Originally Posted by Philliefan33 There's another variable I haven't seen mentioned yet. Not all servers make minimum wage. In PA, a couple of years ago, my danger was paid $2.35 per hour by the restaurant. She had to share tips with the bartender/busboys/runners. Most shifts she was able to average $10/hour but not always. Compare that to a cousin who was working as a server in OR at the same time. She got paid minimum wage, which was $10.xx per hour. Then she got tips on top of that. The aunts and uncles were shocked to learned that my D was only paid $2.xx an hour.

You probably realize, but federal minimum wage for tipped employees is $2.13/hr. Many states have higher minimums, but nothing like the general minimum wage. If wages and tips are less than $7.25/hr the employer is required to make up the difference. BUT I am sure too many employers don't make up the difference, with all the cash transactions, objective accounting would be essentially impossible.

http://www.dol.gov/whd/state/tipped.htm

[retirementguy1]

Quote:

Originally Posted by Midpack As I noted earlier, tip pooling is another matter, and evidently more and more restaurants are abusing the practice (I was never forced to pool tips, though I often did so voluntarily). More of us might agree on that, and that would begin to help servers... And I assume 99%+ of diners have no idea which restaurants they frequent use/abuse tip pooling. Though turnover would be one of the telltale signs.

This situation was not a tip pool. I have been in tip pools and I prefer them. It eliminates bias from the managers and hostesses. It is frustrating to have your financial fate in the hands of an 18 yo girl.

A tip pool is based on a point system. Ex. Servers get 1 point, bartenders get 1 point, bussers get .33, and runners get .4. You add up the tips at the end of the night and divide it by the number of points. So to make it easy lets say the server makes $100, the busser makes 33, and the runner makes 40.

[Chuckanut]

I was in Holland several years ago and a group of us had lunch at a rather nice brewery. After the meal was over, one lady insisted on leaving a tip on the table despite being told several times that tipping was not expected or needed. As we were leaving the waiter stopped us and handed the tip money back, thinking we had left it by accident.

[traineeinvestor]

Restaurants in many other countries routinely provide great service and stay in business without tipping being either required or expected. The US is the only country I visit where large tips are expected - and the US tipping culture does not result in better service. In most of the countries I visit, tips are entirely optional and a few (like Hong Kong) have a mandatory 10% service charge added to the bill - the US practice of adding a "discretionary" 15-20% to a bill is something of an anomaly.

[Cobra9777]

Quote:

Originally Posted by Midpack ...And the article makes points that are way too easy to counter. People can't do math - that's idiotic and sad...

Actually, that's NOT idiotic and sad. I go out to eat with my 82-year-old FIL at least once every week. He insists on paying every other time. He had a stroke several years ago, so in fact, he quite literally "can't do the math." We have a "routine", where he gives the waitress his credit card. When she returns, he asks me, what do think about a tip? At that point, I grab the bill, fill in the necessary amounts, etc, and return it to him to sign. It makes for one less humiliating moment for a proud American engineer who helped put a man on the moon, but can no longer calculate 15% of $25. But yeah, that's idiotic and sad.

[utrecht]

I doubt he was referring to 82 year old stoke victims he said people cant do math

[samclem]

Quote:

Originally Posted by Sunset . . .its like other low wage jobs where the tax payer gets to support the workers at various companies via food stamps, etc. even if I don't get anything from that low paying company.

I don't understand this reasoning. The taxpayer would still be paying these benefits (food stamps, etc) if the person had no job at all, so the employer really isn't part of the equation. Yet people say this--that the government is somehow "subsidizing" employers of low-wage workers.

As far as I can see, it only makes sense if we assume that the employer isn't paying for the services of the employee, but is instead responsible for meeting all the basic material needs of their employees in exchange for their labor--so the government's food stamps help the employer meet their obligation. But that would be far different than the normal understanding of the employer/employee relationship.

Lots of low-wage part time workers have a couple of jobs to make ends meet. It has always been that way.

[sengsational]

To the folks that said "not in my lifetime", I have a question for you...

Wouldn't a law that forced every business, including restaurants, to pay the real minimum wage precipitate a no tipping culture in no time? I'd think twice about tipping in those cities (that city?) that implemented that law locally.

[Texas Proud]

Quote:

Originally Posted by Midpack While there are certainly many good servers who are not well paid, these are sweeping generalizations. A truly good, or even half decent server in an upscale restaurant can make a very good living, without any advanced education. I worked in a moderately high end restaurant the last summer before I graduated college, and I made more per month in that restaurant than I was making as a Process Engineer for the first few years starting out. Yes, I did better $ in the long run, but there are also some really high end servers (much more talented than I was as a server) who take home six-figures nowadays - guaranteed. And if you asked truly professional career servers what they think about eliminating tipping, I suspect they'd be overwhelmingly opposed... And between those who are not well paid, and the top end six figure servers, there's a whole continuum of folks who are fairly or even well paid for the service they provide. Like most professions...

Not to be too negative.... but you used my quote way out of context....

I was talking about a lunch service at a chain where lunch was $6 to $8.... I would challenge you to find anybody doing that making a decent wage....

High end restaurants are a much different experience.... I remember going to the 4 Seasons during a closing... I think 8 people where there... I think the bill came close to $3,000... I did not see the tip but would not be surprised if it were $600.... much more than my small $1.50 tip for my lunch....

[photoguy]

Quote:

Originally Posted by sengsational To the folks that said "not in my lifetime", I have a question for you... Wouldn't a law that forced every business, including restaurants, to pay the real minimum wage precipitate a no tipping culture in no time? I'd think twice about tipping in those cities (that city?) that implemented that law locally.

A few states already mandate that tipped employees receive the state minimum wage (e.g. california, washington, oregon, etc.) instead of the federal 2.13/hr. I'm not sure how long these laws have been in effect, but restaurants with no tipping are very rare and I've never personally been in one.

From what I can tell from news stories, the no tipping restaurants are generally at the high end, have a fixed service charge instead, and pay substantially more than the minimum wage.

[Sunset]

Oh the unfairness of it all.

I go to a restaurant for a $50 meal, tip is $10 for good service.

I go where its $250 meal and the service is good (the same good, after all how good can you carry a tray and ask "will there be anything else"?) and the tip is $50