Some interesting points: ~40% of tipped workers don't make enough to get taxed anyway, no tax on tips would actually advantage better paid workers like casino dealers who don't need the help. NToT is described as a campaign to distract from minimum wage increase initiatives.
Beware the logical fallacy. "A implies B" does not mean that "not A implies not B".
Workers who earn too little to pay taxes (A) will not benefit from a tax cut (B).
But workers who earn enough (not A) may still not benefit (not B), for example because their employer indirectly pockets the difference. That is actually being argued in the article.
So this is indeed the appropriate way of formulating the statement: at least 40% of workers will demonstrably not benefit from this.
I can't read this article because of the paywall. Are they saying that taxable tips are subject to payroll taxes (which employers pay out of pocket)? That would actually benefit both employers and employees in some sense.
Some tipped workers, like bartenders, can make more in tips than a junior software engineer lol. Less taxes definitely helps their cause.
If you are concerned with indirect effects, there's quite a few pros and cons that you could extrapolate from the no tax on tips policy. These arguments are far less compelling in general.
That's...not how it works, like, at all. It's a tax credit, not actual money that you pocket additionally from your existing paycheck. It also only lasts until 2028.
> I can't read this article because of the paywall
I just turned on reader mode in Firefox and then refreshed the page and got the article. I'm surprised how often it works. It often doesn't but sometimes it does.
In that case B would be "is not taxed on the income" and A is "part of the 40%" making the statement not B implies no A: "If you are taxed on your tips that implies you are not part of the 40%".
That seems correct. It's a pretty useless statement, but it is true.
The tax system is graduated. If 40% don’t make enough to hit a band where income is taxed, then you can assume it’s a gentle ride from paying no taxes to not paying much taxes. And anyways, payroll taxes are by far the higher burden for service workers than income taxes.
it will absolutely affect the wage they are paid, it will be used as a constant excuse to not pay more than the legal minimum (2.13/hr as long as tips are greater than $7.25/hr)... probably used to justify additional tip stealing that happens pretty much everywhere, people will tip less because of it
This is nonsense for most jobs, and it's nonsense here too. Very rarely are any jobs treated on pure merit of good vs bad performance. Ultimately it ends up being mostly the luck of having reasonable management and good opportunities. Reasonable management is very hard to come by in the restaurant industry.
And either way, if you wanted to believe the merit-based approach, you're talking maybe the top 5% of servers anywhere making "good" money. Wage theft in the industry is colossal.
I will be pleasantly surprised if the removal of tax on tips does absolutely anything to move the needle for the bottom 95% of servers.
The restaurant industry has been lobbying for this to further avoid the pressure of raising wages and the complication of reporting taxes — the reasoning is out there in the open.
This is the sort of modern shell game where corporate interests further obscure costs to trick the lower class into thinking it's a good deal. It's akin to the math on maintenance Uber drivers tend to fail to do when they're calculating their wages... they're absolutely getting hosed and most of them don't even understand how.
You can just look this up, it's not a secret. Median total pay, including tips, in the US is $32k for waiters. In France, it's €22k. The UK is £23k. Even factoring in health insurance costs — ~4.5k/year for an Obamacare plan — waiters make more in America.
Waiters in the US make significantly more than their British and French counterparts, due to tipping: the US minimum wage is lower than the British and French minimum wages, and despite American waiters being paid at an even lower hourly rate than the US minimum wage, they end up making more due to tips, performing the same job.
The upper 25% of waiters in the US make over $40k a year. Your 95% estimate is very off base.
Well, to be fair, the IRS considers the average tip to be 8% for taxation purposes.
The whole "I get taxed whether you tip me or not", "I have to pay to serve you if you don't tip"? No, not so much. If you can show (there's even a hugely burdensome IRS form that might take as much as 3-4 minutes a month for cash tips) that you earned less than that 8% average, then that's what you get taxed. But most servers don't want to fill that form out, because they get ... rather more than that, and are being undertaxed already.
Sure, but TFA makes clear that any benefit to workers from tax-free tips is laughable compared to the numbers of times the restaurant lobby has fucked them over, by repeatedly killing attempts to keep wages low. It's not even throwing workers scraps, it's more like throwing them crumbs.
They may not pay any income taxes, but they almost certainly pay FICA taxes. If the NToT includes FICA, they would be better off. However, I still think it is terrible idea to advantage some employment classes and means of compensation over others like that.
Yes, creating special exceptions like this is an awful idea.
More carve-outs complicating the tax code and pandering to specific constituents is a bad thing.
It reminds me of listening to a story of how day care business owner-operators are not required by law to contribute to Social Security, don’t, and are then screwed at the end of their life because they don’t have any way to retire.
I live in California and this isn't true here. All restaurant workers receive at least minimum wage before tips. In my city, that's $19/hour with health insurance.
Of course, you're still expected to leave a tip and suggested minimum is now 20%, plus even McDonalds is charging $15 for a 4 oz burger, so I rarely go out to eat at places that expect a tip anymore.
I'm not sure why they specifically should be tax exempt though. Cash tips often were, practically speaking, so a lot of tax evasion was happening, but it still seems odd to single them out.
Yeah, there is a lot of shadiness going on these days. I don't think tips should be requested in any sort of transaction where the employee gets paid more than minimum wage. Restaurants always had this weird system where you could avoid paying your employees if they were tipped, so it was drilled into everyone's head "you're stealing from poor innocent workers if you don't tip 20%". But this is not the case for most workers, and so tips should be truly for exceptional service in cases where the job position is on a normal pay scale.
This isn't to say that I don't tip when not required to or that I only tip people I think are being underpaid, but ... things have gotten a little out of control. If I feel like tipping, I'll tip. I do not need a prompt suggesting anything when it's not coming out of the employee's takehome pay.
I hate to say it but I think some government regulation is required here.
Peak tip cynicism is when you're at an upscale restaurant where the wait staff are obviously being paid more than minimum wage, the bill automatically includes a gratuity (often 18% or more), and then on top of that, there's a line to include another tip.
Another peak of cynicism is that the owners try to argue that the "service charge" is legally not a tip so it doesn't need to be distributed to workers.
Any fee or surcharge beyond the listed menu prices and associated taxes are a tip as far as I'm concerned.
If the restaurant is going to be shady and unilaterally introduce confusion to an already confusing norm, then I consider that norm voided and fair game for any interpretation.
Seven states do not have a separate, lower minimum wage for tipped employees. Instead, they require employers to pay tipped employees the full state minimum wage, regardless of tips received. These states are Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington.
Sixteen states use the federal tipped minimum wage of $2.13:
Alabama, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Nebraska, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, and Wyoming.
> Seven states do not have a separate, lower minimum wage for tipped employees
All workers, in every state, must be paid at least minimum wage.
There's a subtle but important difference in wording. There is no "lower minimum wage" for any employee anywhere. The rule is that employers may credit tips towards pay, up to a certain amount. And they can never credit 100% of pay.
So tipped employees should always earn: minimum_wage + stochastic_number
"lower minimum wage for tipped employees" is incorrect and is just the interpretation of "minimum employer must pay after applying tip credits". Subtle, but very different things! If you aren't earning at least minimum wage (tips inclusive), then your experiencing wage theft.
The DOL page[0] specifically says "Maximum Tip Credit Against Minimum Wage" and that's how the column "Minimum Cash Wage" is calculated, but under no circumstances[1] can the employer pay less than "Minimum Cash Wage". Anything less is illegal. ALSO under no circumstances[1] may an employee earn less than minimum wage.
Right, but if a tipped employee in a lower-tipped-minimum state doesn't make the full minimum wage when their tips are included, it's a lot easier in a place like that for a shady employer to fail to top up their wage. Yes, in theory there are ways for employees to get this enforced, but in practice they are very reasonably and understandably wary about making use of those legal avenues.
Not to mention that in a state where there is no lower tipped-wage minimum, all tips go to the employees directly. In a state where the tipped minimum is lower, tips effectively go to the employer for the amount between the tipped minimum and regular minimum, as that's a cost the employer would otherwise have to pay.
I knew someone who worked a graveyard shift at a Waffle House in NC. After their first month, when tips were distributed, they did not make the federal minimum wage, so they had to request additional pay to get to minimum wage (IIRC it was not automatic).
Waffle house then opened an "inquiry" since if they weren't making minimum wage through tips, it must have been because their service was poor (of course it's actually because it was a weekday graveyard shift).
They got their additional $30 or whatever and were then let go.
So while I agree it is illegal to pay less than federal minimum wage, even with tips, but in practice the system is built such that for poor workers in poor areas, they will frequently make less than minimum wage.
Although probably much less nowadays since the $7.25 is still the federal minimum wage and it's pretty hard to find people desperate enough to work for that little money since recent inflation.
> What's the minimum a business has to pay for a one hour shift?
Minimum wage. You can credit that with tips in some places, but you also have to credit the customer in those cases (not legally, but they aren't coming if you don't), so the net is the same.
I made a longer comment in the main thread[0] because I think there's a tendency for conversations about tipping to degrade as people are making different assumptions based on the different laws of where they're from or grew up.
To be clear:
- Any worker that is not making *at least the state's minimum wage* (including tips) is suffering from wage theft. (with the exception of Georgia (WTF))
- Any worker not receiving a positive valued check are suffering from wage theft
- Tips only count as a credit and no state lets tips act as a 100% credit to the wage[1]. Credits may be amortized across "workweek" pay.
We always need to make sure we distinguish a conversation about wage theft and a conversation about tipping. I think they are unknowingly being used interchangeably (or as an assumption in a conversation)
Servers, often, seem to think it's our (the customer's) obligation to compensate for the sins of their employer.
"Many restaurant owners illegally don't actually follow this law". "Report them to the DOL". "I don't want to do that. You should tip me to make sure I have a livable wage instead."
Sure, it is logical. But that doesn't mean it is a good reaction. Certainly it doesn't help make the problem go away.
Don't confuse "logical" with "correct" or even make the false notion that there is a "correct" reaction. The "right" reaction depends on your goals, short term and long term.
But defeatist attitude results in a tragedy of the commons situation. It's social debt. Think of it like a mess. Messes are easiest to clean up right after they occur. But as time goes on, it becomes harder to clean. If everyone is doing their share of their work messes are very manageable. But if people don't do their share, then it must be picked up by everyone else, right? I think most of us have been in a situation where we've had to clean up "everybody's" mess (if you haven't, you might be that asshole leaving that mess). The defeatist attitude is like that person grumbling "it's too big of a mess, we'll never clean it up." Well... not with that attitude. If the mess needs to be cleaned up, it needs to be cleaned up. Either you help or you make it worse for everyone else.
> even McDonalds is charging $15 for a 4 oz burger
Jeez, where is this? According to the famous McCheapest map the most expensive Big Mac in America is about 8 bucks. Have prices really shot up that much recently?
I'm happy that CA doesn't set a lower min wage for tipped workers, but the problem is that in many/most places in CA, $19/hr is still not a living wage, so the tips are more or less required to keep those workers housed and eating.
A living wage in most population centers in CA is nearly $30/hr.
People argued the living wage was $15/hour in California a few years ago. Then it was $20/hour. Now you're saying $30/hour.
I have to ask what is causing what's considered a living wage to increase so rapidly, because it appears to be increasing far faster than the national inflation rate.
It sounds like a wage-price spiral, though I'm not aware of anyone claiming we're in one.
You are seeing an environment that is highly conducive to a wage spiral, but so far wages haven't shown reactive enough to find that a spiral has set in. Comments like the above indicate that it wouldn't take much of a spark to see it ignite, though.
Granted, like a lot of things in economics, you can only tell in hindsight long after it has played out and the data is collected and analyzed, so it is also possible that the spiral is already underway and we just don't know it yet.
It's actually even worse than that. The $19/hr and health insurance comes from increasing menu prices, so with flat percentage tips, you're paying more purely for the privilege of paying more.
California doesn't have a special minimum wage for tipped professions? When I was waiting tables a long time ago I think my pay was $1.95 an hour. It was usually just enough to cover tax on tips (the ones we admitted).
> California doesn't have a special minimum wage for tipped professions?
NO STATE has a "special minimum wage for tipped professionals". MOST STATES allow tips to be *credited* towards wage, but NO STATE allows an employee to be paid less than minimum wage. There's a "special minimum wage THAT EMPLOYERS MUST CONTRIBUTE TOWARDS a tipped professional'S WAGE", but that's a very different thing than "the minimal amount of pay an employee may receive."
The difference is where the money comes from: directly from employer vs directly from customer. But in all cases *the sum of these sources* must equal the minimum wage.
If the employee is not taking home at least minimum wage, then the employer is guilty of wage theft.
If the employer does not make at least $x towards an employee's wage, the employer is guilty of wage theft.
So instead, read the CA's (and AK, MN, MT, NV, OR, WA) rule as "tips may not be credited towards an employee's salary".
You keep posting this over and over as if states with a lower tipped minimum are equivalent to states with the same minimum, regardless of tips.
You're not wrong that, in states with a lower tipped minimum, the tips act as a credit. But you're ignoring what the power imbalance in those situations can do to an employee, and you're ignoring the fact that in states like that, tips paid by customers are effectively subsidizing the employer out of paying minimum wage.
And I don't think that it would be surprising that wage theft is more common in places where the tipped minimum is set lower than the general minimum.
As a customer, I would much rather know that the employer is paying the full fair minimum wage regardless, and any tip I leave will always be on top of that. I don't want to be paying a part of the employee's wage that the employer would otherwise be paying.
I hear you, but your solution sounds defeatist. Like there's nothing that can be done.
> tips paid by customers are effectively subsidizing the employer out of paying minimum wage.
Not effectively, literally. That is what a credit is.
But I'm making sure that the conversation is clear that anyone not making minimum wage is suffering from wage theft. We have to identify the right problem if we want to fix it.
> As a customer, I would much rather know that the employer is paying the full fair minimum wage regardless
I also like this idea. I don't think there should be a wage credit. It is helpful to reducing wage theft. While I would, personally, get rid of credits I don't think I'd get rid of tipping all together. Certainly at least not until there's a better minimum wage rate.
> I don't want to be paying a part of the employee's wage that the employer would otherwise be paying.
You're always doing this. Either your money goes directly to the employee or is going to the employee through the intermediary of the employer. In the case you are not directly paying the employee you're paying the employer.
They should. It's easy to report. Doesn't matter if nothing happens right away, because the more reports that accumulate the higher priority it becomes.
So instead of trying to tell me how fruitless this is and just give up to endless arguments, maybe report wage theft if you know about it. You can do it anonymously. You can do it for people that tell you. It's not a hopeless situation. Hell, lawyers take payment after the case is won, and you know if your wage is being stolen then others are too
It's easy to report, but retaliation is a thing, and is hard -- and expensive -- to prove. Someone subject to wage theft is not the kind of person who can afford that trouble.
And it's not like restaurant owners don't talk among themselves. Getting blackballed isn't great.
Bottom line is that you seem to think that there's zero reason why people are shy about reporting wage theft. And yet so many people don't want to do it. Maybe try a little humility on and accept that maybe there are reasons you don't know about or don't understand. It's very easy to tell people what they should be doing when you don't have to walk in their shoes.
> but retaliation is a thing, and is hard -- and expensive -- to prove.
My understanding is that it is fairly easy to prove. If you suddenly have a change in working conditions it is considered retaliation. See the example here[0]. Doesn't matter if you're in an at will employment state. If you get terminated really close to a reporting, well, you'll probably take home more money than you would have by working. It's up to the employer to prove the termination was rightful and they can't just say "because".
It also is not expensive. At least not more than the theft. Lawyers working on wage theft generally take payment as part of the recovery. You pay out of the winnings, not up front.
Honestly, a big part of the problem is that many people have defeatist attitudes. A lot of people don't even bother to make a report after they leave. It is hard to retaliate when you've left.
> it's not like restaurant owners don't talk among themselves
I’m sympathetic to the arguments, but this sounds like scaremongering.
If you have evidence of it, please post.
There are so many restaurants everywhere, just leave the worst place off your resume. I can’t see owners coordinating if there’s no online platform for it.
Looks like it changed in 1988 due to a state supreme court ruling about a 1975 law. The law said the tips were the "sole property" of the employee and couldn't be counted by the employer as wages.
>Of course, you're still expected to leave a tip and suggested minimum is now 20%, plus even McDonalds is charging $15 for a 4 oz burger, so I rarely go out to eat at places that expect a tip anymore.
Don't tip, especially 20%, for over the counter service. That is ridiculous.
>I'm not sure why they specifically should be tax exempt though. Cash tips often were, practically speaking, so a lot of tax evasion was happening, but it still seems odd to single them out.
It's just a gimmick to get votes. The theory is that poor people tend to be the ones that work these jobs, they need a break, and it's not a policy that would cost very much anyway. There is a cap on the tips and most cash tips were going unreported anyway.
Don't forget to reduce your tips by the percentage they were previously being taxed, since it is all charity anyway.
Hopefully this becomes another straw that will eventually break the camels back and we get rid of tipping all together. Every restaurant in the world does not need tips to survive, except for the ones in the US.
This is going to expand tipping dramatically. I don't understand how you could have any optimism that tipping will go away after this is passed.
Businesses are going to work hard to blur the line between a tip and a required payment so that they can call their income a tip while customers think they're obligated to pay it.
Nah. Profitability for the business would be higher without tips. I take x% of gross income as profit. No tips means I can charge the customer more, which means a higher gross income, which means more profit. When tipping is involved, the money slips through without allowing the business to take its cut. Good for the server, but not good for the business.
However, as theoretically great as it sounds, you are ultimately beholden to what the customer wants. There is good reason why every restaurant that has tried a "no tips" policy has failed. Nobody shows up to dine. They go somewhere else where they can tip instead. Regular people actually enjoy tipping, as hard as it may be to believe for those who are staring at screens rather than enjoying the ambiance of a restaurant.
It's not that simple. Restaurant owners don't pay payroll taxes on tips, but they do pay it on regular wages. Raising restaurant menu prices by 20% (or the average tip amount) will not result in 20% (or the average tip amount) more going to the workers. Some restaurants have tried this out, and it's backfired. Restaurants already run on very thin margins; a loss of a few percent can kill them.
Also consider that customers will get sticker shock: even though they are ultimately paying the same price, seeing 20% higher prices on the menu will make them spend less. Yes, it's dumb, but human psychology is dumb, so there we are.
(Folks in Europe are used to the listed price being what they pay. In the US businesses don't generally list tax-included prices, but businesses that do include tax in their prices end up looking -- in the eyes of customers -- as more expensive than those that don't, even when the final prices are identical.)
"Some restaurants have tried this out, and it's backfired. "
Where I live, many restaurants have the "required 18% gratuity" thing and ask that you not tip beyond that. Maybe this is a PNW hippie specific thing, but a movement against tipping exists and is being ran by some good, successful, restaurants.
Making the tip required isn't a movement against tipping, it reenforces the idea.
Try increasing the posted food prices by 18%, or add a "18% owner boat fund", instead and see what happens. You won't last the week before you are bankrupt. The amount is exactly the same, so from a financial point of view there is absolutely no difference, but the experience of "helping out the little guy" is lost, and that will chase clientele away. For all the huffing and puffing we hear, actions speak louder than words. The reality is that customers like tipping!
Personally, I hate the whole concept of tipping as promoted in the USA.
I see it as a way that owners can avoid paying the relevant taxes for employing their staff and instead offload part of that payment onto the customers. The arbitrariness of it also annoys me - why just waiting staff?
I'm in the UK, so we mainly have service charges added to the bill to take the place of tips which is a much better system. I also like the Japanese culture of non-tipping and that they may get offended by customers leaving tips.
> I hate the whole concept of tipping as promoted in the USA.
Of all the ways people choose to spend their money, tipping is a strange one to hate. It is not like Taylor Swift pointlessly flying around the world to the detriment of the environment, and thus everyone. It seems pretty foolish, I get that, but fools and their money are to be easily parted. What is the harm in their foolish fun?
> I see it as a way that owners can avoid paying the relevant taxes for employing their staff
Assuming staff will be paid more. That is unlikely in a lot of cases.
Granted, if you are in one of the states that allows tip credits that would be more true given that they would be legally required to move up to minimum wage irrespective of tips, but many states require that staff be paid at least the full minimum wage already and tipping is still just as common in those places.
It is not like McDonalds is paying their staff more without tips (above excepted). Like the death of manufacturing saw an end to high paying manufacturing jobs, the end of tipping would see an end to the $50/hr. waitress. It wouldn't be supplanted.
> why just waiting staff?
You can tip whomever you want — or not tip at all. But in most cases only the business is liable, so it is the only entity you need to please. When alcohol is involved, however, the server becomes liable, so it is in your interest to grease those wheels else get cut off. It is not like anyone tips the waiting staff at McDonald's. It traditionally has only been a custom where alcohol is found for that reason.
But it wasn't long before people realized that they enjoy it! It gives them the thrill of "sticking it to the man", or "helping out the little guy", or in some cases "Look at me. I can pay you more than your own boss can! Aren't I great?". In fact, they liked it so much they have started tipping in other places.
> I'm in the UK, so we mainly have service charges added to the bill to take the place of tips which is a much better system.
That sounds like a tip by another name. How is that a better system? It seems exactly the same (except the customer can't easily opt out of it). Many places in the US do that too (oft known as an auto-gratuity), especially for large parties in restaurants, for what it is worth.
> I also like the Japanese culture of non-tipping and that they may get offended by customers leaving tips.
Whereas on the other side of the pond the opposite is true. I picked up some shifts as a server a while back for what is a long story, but suffice to say money wasn't my motivation. I was collecting a developer's paycheck at the same time, meaning, as I am sure you can math, I was making way more than 99% of the people I was serving, so I felt pretty strange and pathetic taking their "pity money", so I tried rejecting them.
That didn't end well. Customers started getting quite upset with me. In one case I bypassed the tip screen on the credit card machine and the customer not fully paying attention didn't notice and walked out without tipping. Five minutes later he comes stomping back in and gave me an earful about not taking his tip while shoving cash in my face.
I used to think like you, but once I actually experienced it, it became abundantly clear that the customers are there to tip in the kind of establishment that is built on that type of business. It is part of the experience.
Those sitting at home staring at a screen might not understand the appeal, but they aren't the customer.
> Restaurant owners don't pay payroll taxes on tips, but they do pay it on regular wages.
Payroll taxes in most jurisdictions are based on wages, not profitability of the business. A non-issue, well, except maybe for the server who has grown accustomed to making $50/hr. No tips and those days are long gone.
> Some restaurants have tried this out, and it's backfired.
Yup. Hard to win customers when tipping is part of the experience. I mean, it can be done where it isn't — McDonalds survives, thrives even, without tips — but if you are trying to run the type of restaurant where the customer comes to tip it doesn't fly. You have to give the customer what they want at the end of the day, else they'll go somewhere else. This is the challenge businesses face.
> Restaurants already run on very thin margins
Exactly, and if you increase the volume then the product of the margin gets bigger. Remember, Walmart and your average restaurant have the same profit margin! Walmart's advantage is that they handle way more money, so the total amount that margin represents is huge. If a restaurant can also handle more money...
> seeing 20% higher prices on the menu will make them spend less.
Even just, say, 1% higher still means more cashflow through the business, which means more cash to take a cut from. You are right that the full 20% would unlikely ever be realized, certainly not right away, but it doesn't need to be to still be advantageous. But until you figure out how to convince the customer to change their preferences about tipping, good luck.
There is absolutely no obligation to leave a tip. One only does so because they want to!
> Also consider that customers will get sticker shock: even though they are ultimately paying the same price, seeing 20% higher prices on the menu will make them spend less. Yes, it's dumb, but human psychology is dumb, so there we are.
It's not dumb; it's just that paying that 20% to the waiter is a lot easier to stomach than a 20% increase to the restaurant owner.
Because x% is the maximum profit. Not even places like Walmart, for all their might, have figured out how to exceed the same x% (somewhere around 2-3%).
Fascinating how America’s response to people being sick of having to tip on everything, tips being little more than a tax on generosity, was to make this most hated form of remuneration even more advantageous.
Agreed 100%. I will enjoy the creative financial engineering that likely comes with this policy, as we attempt to classify more and more things as gratuity, to escape the reach of the IRS.
> But, when three members of the group came forward to testify, all expressed support for the Tipped Workers Protection Act and opposition to the One Fair Wage Act, which they portrayed as an effort to steal their tips
This article is missing a real issue here by trying to make the story all about the employers. Many workers like the tip system because it creates inequality among the restaurant workers. Good servers can earn a lot more money than what they’d earn if every server were paid the same, fair wage.
My mom used to work at a furniture store as a floor sales associate on commission. She would regularly clear $120,000/year (this was 15 years ago, so like $180,000 today). A generous wage for the job at the time probably would’ve been $50,000 or so. She would’ve fought such a policy tooth and nail.
Is the definition of a good server in this case one who can serve more tables than others in the same amount of time? In most places tips are mandatory and % does not depend much on anything unless someone messed up.
Commission on sales is very different from restaurant tips.
Tips, at least in the US has never been mandatory but it is an immense social pressure. Besides, my understanding is that tipping % is arbitrary anyway - there have been studies that show good looking people get more tips.
I think tipping culture has changed a lot in the last 5 years or so, driven mainly by the point-of-sale machines that request tips for seemingly adding no value. I think people have reached the point of tipping fatigue.
Definitely. I also think it has blurred the lines even more, and exposes how arbitrary it is. Do I tip if I scan from a QR code and order, where I have almost no interactions with the server? How is it any different than counter service? All that changed is instead of self-service order it is self-service pickup. I probably still have to flag down a server to get utensils or water.
Why did the tip percentage go up from 15% as the norm to like 18-20%? It’s a percentage so if things go up in price so does the tip. At what point is it their job vs quality of service? Why don’t we tip fast food workers, because they probably face more abuse / deal with unruly customers more than dine-in (at least from experience).
I'm old. For me, tipping has always been a cash-only transaction because I felt the money going directly into the server's or other staff's pockets. The owner of the business never touched the cash tips, and the tips were rarely reported (for taxes). But now, when I tip with one of those point-of-sale devices, I have no idea where that "tip money" is going - does it ever reach the server or other staff? Does the owner just pocket the "tip money"?
It is usually against the law to do so, and enforcement is extremely pro-labor, so the only chance you'd have to get away with it is if it got swept under the rug and nobody ever complained. But people who work in tipped positions are some of the most ruthless people you'll ever meet (you kind of have to be when tips are your bread and butter), so that's never going to happen in anything but made up fantasy.
> And why did it go up from 18-20% to 22-25% in the last few years?
Especially when they removed the separate server minimum wage at the same time, meaning that servers both moved up into the regular minimum wage and gained in tipping culture.
The final cost of the bill matters more than anything. A server at a higher-end restaurant where the bills regularly exceed hundreds of dollars will earn more in tips serving fewer tables than a server that works at a cheaper casual-chain restaurant (IHOP, Applebees, etc).
More so than tables per unit time, it's dollars per unit time. When I was a server, the usual metric of how well you performed on a given shift was the total of your bills ("how much you sold"). The best servers were good at encouraging parties to spend on the things they were on the fence about: the appetizer, the second drink, the dessert. Even with the volatility of individual tipping decisions, getting your tables to order more increases the EV of your total tips.
I haven't thought of that, makes sense. That likely applies more to higher-end non-chain places and tourist spots with lots of first time visitors. Regular customers will often know what they want.
I don't think you read the article. It explains that those three members who came forward were not actually servers, but restaurant management & owners. Additionally, the article is not missing this issue you call out. The author goes so far as to discuss Casino dealers in Vegas who would stand to gain the most out of this sales tax proposal (sales commissions in your anecdote do not count as tips). But primarily, the author is concerned about the 1/3 of tipped workers who do not pay federal income tax and are at risk of falling below the poverty line due to reductions in their minimum wage.
I think tips in many places are slowly converging into something like a 20% commission paid by the consumer, thanks to restaurants including a suggested tip on the screen or receipt, and bars automatically charging a 20% tip if you don't explicitly close your tab.
I hadn't thought of this before, but keeping tips as formally selected and paid for by the consumer may help the restaurant with liability issues where alcohol is involved. Paying servers and bartenders a direct sales commission might become an issue in court if a customer is overserved.
I've just stopped eating out because of this. Wonder how many people have. I don't want to be made to feel awkward at what is supposed to be an enjoyable experience for me. I especially don't want to be made to feel that way to manipulate money from me.
I used to hate those suggested tip things too. Now I got over my caring and just tip what I think appropriate. I mean when the restaurant sets the default to 25% or 30% that tells me they have no shame so neither should I.
Servers also know that if tips are outlawed, they will never make that much money again.
It's possible for high end bartenders or servers to make over $500 a night in tips. The whiplash of moving into true salary or hourly work is an open secret in the high end service industry. This is why you see some old waiters and bartenders hanging around, when some people consider the service industry "entry level."
This is also why I don't like to listen to them complain about their jobs lol. The difficulty of work to income ratio is unique to this industry.
Yeah, if you're lucky you can make a huge amount of money in tips - if you're the right server on the right night at the right place and get the right customers.
You can also, if you're not lucky, barely make anything in tips on minimal hours per week and then have your employer steal half your tips anyway, and then you're basically clearing $4.50/hr for 12 hours a week and probably ending up on food stamps until republicans eliminate those entirely.
Thing is, I've known freelancers who make great money, but even they can have a constant underlying stress about "if the work dries up I'm homeless". Imagine the same thing but instead of the work drying up your manager only schedules you for four hours a day between the lunch rush and dinner and the tips are minimal despite being there for the same hours.
Some people always like the status quo: no bloc is 100% consistent. With numbers like what you provide, though, this would be a minority of affected people... though, the ones with the most money to lobby.
I wonder if paying servers a commission on the food sales would improve things somewhat. At least it force employers to include that into the price of the items
For food service, specifically waiting tables - how much of the tip is because of effort and better service - and how much is due to the attractiveness and general demographic characteristics of the server?
I personally top out at 20% no matter what. If the service is lousy I’ll go lower. When servers/bartenders are comping me then I know they get it and will up my percentage.
What confuses me most is when you are given the option to give a tip before any service has been given. On deliveroo, for example, I have the option to tip the driver while I'm at the checkout. Why would I give a reward for good service when I have no idea if the service is even good? There's already a rider fee as part of my bill, so it doesn't make any sense to me to give them more money at that point
It is a mechanism to move labor costs to the consumer. On some delivery apps , the driver can decide which jobs to take based on the pre-service tip. So the companies have effectively put the responsibility to pay driver's base wage on the users themselves, while the company still takes a huge corporate cut
I suggested we do this at work. We’ll add a tip field to our Jira tickets and whoever’s ticket is worth the most gets priority. Oh you submitted a production incident a week ago? Sorry, there’s not even $5 on it, we filter those out.
Not in all states. California does not have a lower tipped minimum wage. It's at least $16 here last I checked (except $20 for fast food because "reasons")
Ah yes; for a bit my wife was making less as a preschool teacher than the minimum wage at McDonalds. I understand it caused a bit of turnover at the local public schools, since cafeteria workers and aides were making less than $20/hr in 2024 as well (I don't know if they still are).
Reminds me of when I was visiting family a few years ago in Kentucky. I kept seeing tons of ads everywhere about hiring for plumbers, and some warehouse roles.
The listed salaries were not that far off from what even the local McDonald’s was paying
There was a (at least local) McDonald's inversion just after Covid; they were paying $20/hr which was competitive or better than the local factories.
It's one of those "reset" things you need to do now and then, because it's really easy for an industry like CNA or similar to end up paying less than the gas station for more annoying work.
So it does make great sense for a CNA or a preschool teacher to be quite a bit more highly paid than a gas station attendant or fry cook, due to the much higher responsibility level and like you said the annoyance.
However, I don't think anything that's happened in the last 5 years has helped that. If anything, the inflation has cost everyone dearly, but if I put 20% of my income into stocks I am less impacted than poor people who put 100% of their income into goods and services whose prices have gone up as a result of everyone's wages.
Fun fact, we had this at an old job. It was a charge code field in Jira. It was required whenever you requested work from an external team. It operated like a credit card with a set budget. If you bothered other teams a lot, you ran out of money. Department heads set their price.
It sounds great in theory. But a black market quickly developed, and people figured out ways to circumvent it. People created tickets for their own teams and shared laptops.
On delivery apps it should be called a "bid" and I think honestly it would be more ethical than the shady nonsense they do now if they went all in on that.
If the apps were actually what they claim to be (a marketplace to connect hirers and workers) that's exactly what you'd have - the cost of the food + flat fee for the platform + your bid for the work. The platform could even suggest a bid, but you could choose to bid higher or lower depending on what you think would go through.
But that's not what they are; they're shady "avoid employment laws" companies.
I often see the claim that it would be above board/legit/not a circumvention of employment laws if they ran a bidding system like that. But ... that's exactly how Sidecar worked (Uber competitor, shut down Dec 2014), and I never saw anyone distinguish them from Uber in their criticisms (until people forgot that model existed).
i like the idea of bids, but only if its coupled with the ability of workers to just outright reject the offer.
the problem is that there's still a guarantee of service for the user regardless of what you bid. if i want my burritos delivered at 2AM and am only willing to bid $1 on delivery labor, i shouldn't expect that my burritos will be delivered.
for tips, the model is "the work will be done and i'll pay extra if it's good". but with bids its "how much do i need to pay to get this work started"
> It is a mechanism to move labor costs to the consumer.
How does this work? The corp already handles some form of payment to the worker, especially when you tip as part of a card payment. And in both cases, the consumer foots the bill.
How's it different from paying the worker more and asking for more money upfront?
The gready sleazeballs who like the "tipping" system (mostly, restaurant owners) would prefer to pay all their employees $0 and have all diners/customers/etc pay 100% of the wages out of guilt.
While 10% was customary in the first half of the 20th century, the standard tip gradually increased to 15% by the 1980s.
In 2025 it's not uncommon to see little shortcut buttons for 20, 25, 30%. You can see where this is going. They want us to tip 50% and they pay $0, even though restaurant menu prices are one of the things that has experienced more inflation than other things.
> would prefer to pay all their employees $0 and have all diners/customers/etc pay 100% of the wages out of guilt.
It is my understanding that this is literally the origin of tipping.
After the abolition of slavery, there were many black people newly looking for work. And, there were employers looking for workers, but unwilling to pay money to black people.
So, someone got the idea to promote that tipping was something fancy European aristocrats did. And, you can be fancy like they were by tipping my workers (that I refuse to pay).
Tipping was previously seen as un-Americanly classist. And, most states tried to ban it when it started to pick up steam. But, it was too late. So many employers were enjoying unpaid labor that the bans were repealed.
Later, when Minimum Wage was established, workers who lived on tips alone were almost all black. So, unsurprisingly, tipped workers were excluded from the wage regulation. And, today they are only acknowledged as fractional minimum laborers.
Perhaps shouting these problematic racist origins from the rooftops is our best shot at getting the support of the Left on board to at least establish that having business models based on obligatory tipping is unethical, if not to ban it.
It would backfire. They’re already losing the culture war. I don’t think the demographic you’re targeting will be very valuable on the scale of real political action.
The workers love the tipping system too, and it is directly in their interest to talk about how much it sucks, so that you are guilted into tipping more.
I spent 10 years in the food service industry working every position. The whole thing is racket, and the narrative used is carefully worded.
When I first had the money to pay for restaurant food ca. 1975, 15% was standard. I think that the Waiter Rant guy considered anything under 20% an insult, about 30 years after that.
Ah yes, the greedy sleazeballs. If you knew that the total cost of the meal would be the same, say $20 for the meal, does it to you matter if:
1) you pay $20 "no tip" and the owner pays non-tip minimum wage, or
b) you pay $16.50 for the food and $3.50 separately to the server in the form of a tip
?
The problem is that the customer does not know the cost of the meal; they typically rely on the business owner to be upfront about that. Tipping is guilt-motivated drip pricing. The only thing the commenter got wrong is that the restaurateur has to prime the customer with some cost so they can voluntarily add a percentage.
That's the crux of it. All surcharges are scams designed to trick the customer into thinking the meal is priced lower than it is. Sales tax not built into menu prices is a scam that the government is at fault for allowing. All other surcharges including the socially-obligatory tip and the scummy "health care surcharges" common in California, are scams that the restaurant is choosing to do. All of these are insulting.
It's no different than telling women I'm 6' and then when they meet me revealing that's only when I'm wearing cowboy boots and a big hat.
There is a very clear different from the consumer's point of view between paying a 20% delivery fee with no tip (and realistically having most drivers still expect an in-person tip) and a 5% delivery fee with a tip amount of your choosing (and maybe only 1/1000 drivers expecting/requesting yet more).
I have always been a generous tipper and I try to always put myself in that person's shoes when deciding how much to tip but even I notice the psychological difference. If you don't ever think about it, have never had a job waiting tables or dealing with the public, it'd almost be a nonstarter to have a higher delivery fee regardless of tip expectation.
psychologically they are very different. Framing the wages as a "tip" moves the conversation to the drivers and users, where users think tips are an out of hand culture problem and drivers view the users as stingy. Then the company sits out of the spotlight collecting their absurd rents
It moves the real cost of the additional labor from the prices displayed for items (like you would see in a B&M grocery store) to some tertiary part of the purchase process that is displayed 1) after the used has gone through the effort of app navigation and selecting their purchases and 2) has been through the majority of the purchase funnel and self-selected as a high-prospect sale. This helps keep the listed prices for items in these apps relatively comparable to their in-store listed prices, acting to convince the user the sale is reasonable (similar to online sellers making up for low listed prices with high shipping prices). Moving this additional cost to some tertiary step lessens the impact of goods pricing seeming too high by adding a "small optional fee" at the end of the purchase process that the user is expected to subconciously understand is effectively a bid on labor. I'd imagine the psychology behind it is depressing.
That is true. What is also true is that having things delivered to you is not free, and the prices of the goods cannot be same for delivery vs warehousing in a store.
It cannot be the case because the business would cease to exist in their current form if they did that. They would close their retail stores and become online only, because there is now zero incentive for anyone to go to the store instead of ordering it and having it delivered.
Different because now list price of a sandwich is $8.99 instead of $14 that customer will actually pay. Hotels, resorts, restaurants, tours etc are master at this. Even after knowing these add-ons people fall for it often enough to keep this practice running.
Besides economists think positively of this so it has support not just from interested parties but officials, think tanks etc.
>Are there still customers giving tips as "a reward for good service"?
As in any tip at all? No, from me. I don’t think I’ve never _not_ tipped when the situation expects it (sit down restaurant being served). I know the person there is being paid less than minimum wage (where I live), which is already too low in my opinion, so they get something.
The amount of the tip certainly is highly dependent on level of service. That could be a significant difference at the end. I’ve tipped over 100% when the staff has done someone that stood out to me.
(Having been a server in the past and now in tech, I feel guilty about the work-level/salary imbalance, so I am generally generous with my tips.)
> I know the person there is being paid less than minimum wage (where I live)
The restaurants I worked at (a variety of family places and bars) everyone was paid $2.13/hr or something like that. And after taxes, you would get a paycheck for $0.00.
but
The same people who jumped to tell you that they got paid less than minimum wage (especially when customers inquired about it), were making $40-80K year in reality. The service industry is all about hours worked, and which hours you work. A lot of young workers refuse to work the busy shifts (weekends), and hate dinner shifts (could be out with friends) so they only work the slow shifts and make ~$20/hr * 18 hours or something like that.
But the people there to make money? They work all the busy shifts and slow shifts to fill the gap (they work a full 40 hours), and the money is insane for what the work is. Meanwhile they will happily tell you they get paychecks for $0.00 and only made $50 on Monday at lunch.
In my country, which does have a tipping culture, the norm is to give a 10% tip in restaurants as a default, for competent service, decent food, etc. If the service is worse than normal (rude server, cold food, huge wait times, mistaken orders etc) you'd live a lower tip, possibly none at all. If the service is great, you might leave a higher tip - though 20% would be considered huge, 12-15% might be quite normal for very good service.
> Are there still customers giving tips as "a reward for good service"?
Sad if this is no longer the case.
In the UK at least (and the rest of Europe too, as far as I can tell), this is still very much the case. The curve varies with the individuals tipping. I would be quite happy to give 20% if the service was outstanding. I’m equally happy to not tip at all if the service was very poor.
Still it's not the scam that passes for wage in the US (especially considering cost of living and other expenses). And Paris can be anything, from expensive neighborhoods to project suburbs.
If you're paying a relatively high hourly wage to all of the staff, it seems unsurprising that you'd not want to be open during times of low customer traffic.
Honestly, this seems good overall; there's no more sense in having low-paid waitstaff hanging around hoping to get a customer table that will tip than in having a restaurant owner keep the restaurant open while paying the staff a reasonable hourly wage.
> In the UK at least this is still very much the case.
Except for the very pervasive 12.5% "discretionary" service charge the you would have to request to be removed. Which is a genius piece of social engineering.
I live in the UK, and I personally have never given a tip, I don't think I've even seen it as an option other than physically giving the other person some cash, but AFAIK its generally seen as something you do if the service was excellent, but as I say I've never done it myself. I'm not generally in situations where it could be warranted, like I don't really eat out much or anything like that
As someone who also lives in the UK this surprises me. Almost every restaurant I eat at now takes the liberty of adding a 10% service charge onto every bill. I assume the idea of which is to make it awkward/embarrassing for you to request to have it taken off.
I may have had this happen without realising, but in my head, a tip is something you choose to add on extra, whether for good service or because the workers aren't getting paid properly. If I get a service charge, that's more like just part of the bill that I would pay, though I've only really noticed it as part of online stuff, for example my bank has a £25 service change to send money overseas (for some reason, I can't imagine that the process isn't fully automatic by now)
Yes, in countries outside the US I don't tip unless I got especially good service. Servers get paid (at least) minimum wage here and if they want more they should take it up with their employer like the rest of us.
In the US I usually tip but have refused to do so when the service was especially bad - although even then its a hard decision because you often don't know who is actually responsible for the bad service.
In my country the norm is for tips to be rounding based rather than percentage. So if your bill is 327.5, you would pay 350, effectively a "keep the change" sort of gesture.
I have certainly starred them in the eye and waited for them to ostentatiously count out every last penny when the service was truly abominable. It's a fairly effective way to give feedback.
You can also of course round up higher, so in the previous example for exceeding expectations you could round up to 400.
In the US, the tip is an expected part of the expense of eating out (and increasingly having any human in the loop). I hate it, and I really wish it wasn’t the case, but it pretty much is. If you say “I didn’t tip because the service was what I expected”, you’re pretty much considered an asshole.
(Incidentally, this is also one of the reasons why the costs of eating out in the US and seem so much lower. Most people who come from non-tipping cultures don’t understand that Americans actually tend to pay significantly more than sticker price, especially after you include taxes, which are also often excluded).
> Shannon wanted to measure the amount of information you could transmit via various media. There are many ways of sending messages: you could produce smoke signals, use Morse code, the telephone, or (in today's world) send an email. To treat them all on equal terms, Shannon decided to forget about exactly how each of these methods transmits a message and simply thought of them as ways of producing strings of symbols. How do you measure the information contained in such a string?
>If you say “I didn’t tip because the service was what I expected”, you’re pretty much considered an asshole
Sorry, this is definitely not the case. Many times the worker is doing exactly what is needed and nothing more (eg: pour a beer in a glass, handing me a pizza). Why would I be considered an asshole if I didn't tip? That is ridiculous.
As other people have said, tipping in the US has really become obnoxious. I definitely tip while seated for a meal, but asking for a tip to hand me a cup of coffee, pour a beer, etc only makes the system worse.
Why would employees in front of a counter be more deserving than employees behind a counter?
Or perhaps I should put it like: Why would a business need to pay a predictable market rate salary for employees behind the counter, but not for employees in front of the counter (because you step in and provide it instead)?
Because the person serving a beer at a bar simply poured me a beer. I walked up to the bar where I ordered from the menu. The level of interaction with staff = 1. Effort from staff = 1.
The the waiter/waitress had to come to my table, discuss the menu, provide feedback on questions, submitted order to kitchen, delivered order, checked back on us to see if we need anything else, etc. Level of interaction with staff > 1, level of effort from staff > 1. Tip appropriately if level of effort > 1 for helpfulness, politeness, attentiveness, etc. Stop making this so hard.
So how many hours is the walking waiter working in a day, and how many hours is the standing waiter working?
If anything it seems to me that it would be more logical to tip the person doing the more boring and repetitive work.
(My personal opinion is that tipping in general is a blight on a modern society and something that belong in primitive third-world economies. The way to fix this is via legislation: we simply make all forms of both receiving and giving tips illegal. It probably won't take much enforcement to quickly shift the social norms and economic practices once the wheels get rolling).
LLM, please create a techno-finance solution to this social problem, inspired by historical precedent for defending royalty and other high-value individuals against food poisoning.
> We can perform DNA and poison surveillance tests on delivered food. For statistical sampling, actual tips can be temporarily and randomly set to zero before delivery, which may or may not match the random deliveries that are chosen for screening. Positive test results will result in lifetime bans and proportionate penalty for system-wide discouragement of food tampering. An additional service fee will be imposed on every delivery to fund liability insurance for customer harm due to false negative results on tampered food delivery.
Non-technical solution: move to a location with high social trust, e.g. neighbors and workers know and support each other socially and economically.
I feel like you’re making their point. If the “punishment“ for paying sticker price is you getting actually hurt, then it’s not a tip, it’s extortion. A social custom that the customary price of something is 30% more expensive than what the sticker says is unfortunate. A social custom of extortion is abominable.
>The OP above you is guaranteed to have had their food spat in or otherwise tortured as punishment for not tipping.
Wait, what??? Do you honestly believe the worker pours a cup of coffee in a to-go cup, hands it to me, checks the receipt for a tip, then grabs it back to spit in it? What kind of delusional thinking is this? How does the food delivery person even know the tip amount before the receipt? This kind of thinking is exactly why the system is so out of hand.
In my personal experience, the belief that “you should tip no matter what” is surprisingly pervasive. Anecdotally, I once had a situation where a restaurant completely dropped the ball—they brought me a cup of coffee, then never returned to take my order, even after I asked. After wasting my time, I had to leave and eat elsewhere. I didn’t leave a tip, yet many of my peers insisted I still should have. I disagree. The idea of tipping someone for poor service—especially when they’re clearly not even trying—is, frankly, sickening. If that makes me the a-hole in these situations, so be it—I’d rather be that than reward apathy.
If you’re asked for a 20/25/30% tip before they even start preparing your food, and you need to make extra clicks while the tip recipient is looking at you if you want to tip lower, theres a small fear that the food you ordered wont be prepared as well as someone who left the tip
On a gig delivery app, you give a tip so that someone will be happy to deliver it and not mess up your food, I think. a 0% tip is risking stuff. You can't really say it's a reward for the service though, more of a payment to secure better service?
Lots of places will now ask for tips before the food comes out even in person now - lunch sandwich shops, etc. I don't think they'd be unprofessional enough to mess up your order if you didn't tip, but maybe they'll be happier with you or be more generous if you tip now too.
On some delivery apps, tips can be increased after service delivery, e.g. baseline at time of order, bonus after good service.
> 0% tip is risking stuff
There are more numbers between zero and good! Markets depend on information. Price has been information for centuries.
The insurance industry has actuarial lessons for managing risk. The delivery app industry has a range of policy measures for managing delivery performance, including but not limited to refunds and blacklisting workers from serving specific clients.
It might be a way for them to prioritize your order before others as they see how much money they earn, so actually it's a bidding process disguised as tipping. I'm not sure if it's shown in the backend though, but I have seen things like this in other delivery apps.
Why would they prioritize you when you've already paid? Wouldn't they first go after the possibility of more tip money on jobs that haven't yet paid it? I mean, if I was a driver, unless there are more high tip jobs than I could handle, I'd take those and fill in with low tip jobs, and I'd deliver the low tip jobs first in a hope of getting an after the fact tip.
Delivery drivers on some apps are told the expected pay for a trip. If you don't tip, they might decline the job because it costs them more to deliver then they make.
This makes your order sit longer until someone decides to do it, perhaps because there's a penalty from the company for declining jobs, and the driver is willing to lose money to remain in good standing
Ooh that’s actually a really interesting question. Because you’ve retroactively signaled that you will pay more for priority service? Or that you’re dumb. Needs to be iterated. Incentives depend strongly on population of both drivers and customers.
A lot of times, that makes the order come slower. A higher tip means the app will pair your order with someone else that didn't tip or tipped smaller, using your money to make up the difference. I consistently get faster deliveries when I tip towards "the average" instead of over tipping
Why would you keep using an app that you suspect was cynically exploiting your generosity like that? I’d drive every time rather than encourage such behaviour.
>Why would you keep using an app that you suspect was cynically exploiting your generosity like that? I’d drive every time rather than encourage such behaviour.
Surely you already know that choosing things doesn't always simplify down to a single dimension. Instead, there are multiple factors that lead people to deliberately choose options that have negatives.
E.g. Why do people continue to use Ryanair airlines if they always nickel & dime customers and treat them like shit?!? Because the mistreatment by Ryanair is still better than driving for 6 hours or paying more $$$ for Air France or KLM.
Likewise, why do customers continue playing along with the tips/bribery/ransom game in the delivery app?!? Because the user-hostile app is still better than rounding up the small toddlers and infant into the car, fasten the car seat, and drive to the restaurant.
Life doesn't always provide unambiguous good options. Instead, you choose the "least bad" from the list of bad options.
In a Louis Rossmann video (i think it was the one on food delivery guys on e-bikes) he mentions never tipping in app but leaving a note that says he will give a cash tip if the driver brings the food straight to his door. That seems like a decent compromise as it doesn't let the app take a cut from the tip and makes so the driver actually goes the extra mile to 'deserve' the tip.
Weirdly on Reddit I keep getting the doordash and ubereats communities pushed at me - there is a very strong view amongst people using these apps that anyone who says they will "give a cash tip" will not actually do it, so it's probably not as beneficial as you might think.
The tips on the apps nominally do go entirely to the driver.
About half the time I order UberEats I get a call from the driver that they're here and to come downstairs because they won't enter my apartment building. Could be laziness, it could also be because the street parking is always full and so the only place to park close by is a fire hydrant.
The app has different options for meeting in the lobby / come to my unit and I always select my unit, but whatever, I get why they might not do that.
But that filter is at best inaccurate then isnt it? Surely there exists a driver which would accept a tipless delivery, but you cannot find them because all you can do is decline to do business.
Americans need to remove the idea of tipping. It's archaic, because it was originally there for an aristocratic/wealthy patron to show off their status to the lowly servants of an establishment.
Just charge a price, and have it include the full service fee required for providing the service.
> You’re not paying for a service, you’re bidding in an open market.
IMHO, this isn't a new phenomenon. Close to 18 years ago, I lived in a city with a popular pizza spot that was about a 10 minute walk away. Normally I'd walk, but having a newborn make that challenging, so I'd get delivery.
Typically, the delivery would take 60+ minutes on a busy night, but after a few consecutive Fridays of a decent tip for the order, the pizza would arrive "burn your fingers" in about 20 minutes.
All that this does is ensure you don't get stacked with another order ahead of you (so the delivery is direct from the restaurant to the person who ordered) in theory.
It doesn't help with situations where drivers are multi-apping (accepting orders across multiple apps and juggling them). The drivers don't even know you have priority.
edit: and in the US where you can definitely see the tip up front, you will almost always find that the order will get picked up quicker if you increase the tip by the equivalent of the priority fee. But you may well get stuck with a delivery before yours.
this feels weird to me because i always thought i already paid for the service as part of my order. having to go into a open, blind bidding war with other customers to gett my order processed ...
Doesn’t affect anything in my country using the same apps. I’ve always gotten fast delivery, as does everyone I know and nobody tips. Tipping is for yanks.
Tipping is more like a form of price discrimination. It allows restaurants to indirectly charge different customers different amounts based on ability to pay.
It's mostly a convenience, so that you don't have to look for coins or remember to tip online later. Uber here even tells you that the driver doesn't get informed about the tip until an hour after delivery, so you can still edit it in case you change your mind.
we can literally get the state to say it is illegal for the point of sale system to have that or sell that to merchants
we can tie it to business codes that dictate which type of business it is to payment processors
control behavior by regulating the intermediary
the beauty of this philosophy is that it works under any system of government: don’t worry about the rights afforded to merchants or individuals, don’t burden them with the law at all, only intermediaries!
poof, tips at the point of sale system before receiving service disappears as fast as it came, short Square (now Block)
A delivery app tip is a way to influence drivers to pick your order, they can see what the expected value of a delivery is and if your tip is too low, your order will take a while.
Consider it a premium that prioritizes your order, that’s what it actually is.
The crazier part is that it's spreading to more industries and more countries thanks to Americans thinking they should tip everyone everywhere. Thanks.
My take is that it is spreading not due to culture, but due to how all new point of sale systems / card terminals come with a "tip" feature implemented.
I'm from Europe, and have traveled here extensively. Tipping is pretty rare, but for the past maybe 5 years, almost all new payment terminals have the tipping option.
If the EU can force every person on earth to dismiss a cookie popup on every website they visit, surely they can pass some regulation to rein in the expansion of tipping.
For example, just make it a requirement that the default tip is 0% in point of sale systems.
This is absolutely true, but that is exactly how culture spreads now. Through products/software/media.
American business software, American movies, American YouTube channels. They will inject American problems and solutions into your country, like it or not.
Microsoft may treat your privacy slightly better because of the GDPR, but those invasive systems are still there, toggled off. Waiting for Microsofts lobbying to chip away at the privacy laws until they can turn them on.
Microsoft doesn't need to chip at the privacy laws of the EU, the EU is doing that itself by introducing massive state surveillance laws every 6 months.
No, it's spreading because corporations are waking up to what an insanely good deal "pay my employees for me" is.
In my state an employer is only responsible for raising an employee's effective wage (for the entire pay period) to minimum wage if the tips don't.
You can tip someone working as a waiter $100 and unless they've already hit minimum wage for that pay period, all you're doing is handing $100 to the owner because it's $100 they don't have to pay in wages. Once the waiter has met minimum wage, then the money actually goes to them.
Same here. We have really cut down on the amount of "out for lunch/dinner" activities we plan. One reason is the tip situation; the other is because we can cook as well at home than out of the house. In the past (80s), going out to dinner was considered a real treat. In the 2000s, it was commonplace. Now, I think we are back to the 80s mentality (cost, tipping, food quality, etc)
In California we've set the tipped minimum wage to the same as the non-tipped minimum wage (so employers have to pay their employees the same regular minimum wage regardless of whether or not it's a tipped job). Unfortunately, that hasn't fixed the tipping problem.
Of course, a living wage in California is quite a bit higher then even our above-average minimum wage, so that's a big part of it.
I'd argue that (our socially-obligatory form of) tipping is a deceptive pricing practice (not really any better than a store labeling shelves with a giant $4 and a .99 written so small you need a magnifying glass to perceive it). As such, if banning it is too impractical, they should disincentivize it with the tax system. I can't figure out the best way, but it's disappointing that our government is obviously not trying to.
Note: I don't care one bit if someone wants to recognize an exceptional act by handing $20 to a worker -- that's great. That's not the same as giving a bartender $4 for spending 12 seconds pouring vodka and redbull into a glass or tipping $3 when I stood in line to order at a counter and came to fetch my food when my number is called.
I think a ban on the solicitation of tips, including tip jars, would be practical and easy to implement. It would still be legal to tip if not asked/prompted. That would make the tip prompts on payment terminals illegal, as well as tip jars.
I don’t think tipping would continue without a way to demand tips or shame people with prompts.
my wife worked under this regime of we-pay-below-minimum and you make it up with tips, when she was a student. it’s illegal in multiple states. including the state where it was done to her. but if you need that sort of job you’re typically probably not in a position to go after your employer…
I'm guessing this barely applies in practice, since only 1% of hourly employees make minimum wage. A tipped employee who doesn't reach minimum wage is probably getting fired regardless.
It is also not "tip" anymore, it is just "whatever pays the most" gets the service. It is just to maximise profit out of suckers, something US have perfected (from insurance to fast passes).
I don't mind tipping for exceptional service, I do however have a major issue with the obligation of tipping. It really should not be on the customers to pay the employees salaries directly.
I don't think we should be tipping at all, even for exceptional service. The job is the job, and the employer should be paying the full amount that job is worth. If the employee is doing it exceptionally well, going above and beyond, the employer should reward them with a raise, same as for salaried positions.
That's assuming the employer values that above-and-beyond-ness, of course. If not, they won't give that raise, and employees will eventually settle on a level of service that the employer is paying for. If that's good enough for the customers, that's fine. If not, that's an opportunity for a competitor to pay employees more so they'll serve customers better.
Customers should not be put in the awkward position of feeling like they should be augmenting people's wages, even if it's on top of an already-sufficient living wage. Wages paid is a negotiation between employer and employee. Customers should not be involved, beyond paying the listed or contracted/agreed-upon price.
I live in a country with near zero tipping culture.
For the most part I find the food gets to my table at some point but I'm rarely particularly happy with customer service. It's sometimes an awkward negotiation to get their attention or to ask something. The opposite was true in my time living in the US - soft skills, fast response, engagement are standard. And I've been on both sides of that in food service.
Now, the logic of what youre talking about makes perfect sense and I agree with that in principle. And yet there is something about dining that is somehow different. Escapes that definition.
There are also times I find that exchanging money is more honest. I want you to serve me, I'm paying you, I don't have to keep at the back of my mind a question whether I'm asking something beyond what your boss expects/pays you. I like that about the US - it's brutal but that's reality.
Don't get me wrong, I live in EU for a reason, but some things here are made unnecessarily complicated and oblique too.
I haven't spent almost any time in Europe, but in the US at some point it seems to have gone from a setup to incentivize that "soft skills, fast response, engagement" to one that I don't feel does that much due to the social obligation. When your worst case scenario is 18% and your best case is likely 20% + rounded up, who bothers to change their behavior? In my experience it's more like a commission than a tip, and that's because the only real impact is it encourages the waiters to remember to promote expensive alcoholic drinks before and during the meal, since you can earn way more money getting 18% from a table who orders 2 drinks than you do by earning 21% from a table drinking water. As a commission, it should be paid by the employer.
I call tipping the "A*hole discount" because only someone who is comfortable being seen as one would consider tipping 0% or even 10%. And servers will tell you that if you receive terrible, horrible, very bad service you should never tip zero, you should speak to the manager instead (since yadda yadda, the tips are for everyone, you don't know whose fault it is, etc). So instead of tips being a way to reward good service, it's actually just a discount reserved for people who are so uncouth that (A) they don't care if everyone at their table thinks they're an ass, and (B) they don't mind taking food off the table of low-wage workers (very low in states that have the horrible policy of a lower "tipped" min wage). Do those people really deserve a discount?
> There are also times I find that exchanging money is more honest. I want you to serve me, I'm paying you, I don't have to keep at the back of my mind a question whether I'm asking something beyond what your boss expects/pays you. I like that about the US - it's brutal but that's reality.
But isn't this describing tipping? You're having to ask yourself, "Is this service good enough for a tip? How much of a tip?" instead of just exchanging money for the service and that's it.
It is and that's why my point is that there is nuance here.
I had more fun and more satisfaction working in food service in the US than in the EU. There was also more real opportunity right there on the spot to do the thing and get more.
Like yeah, you're having to ask yourself and that's friction. But shouldn't there be a friction when you're being served by someone who is an equal? I've seen folks treat service like garbage in the EU because that exchange obscures the fact that there is an exchange of money. And I've seen service fall back on apathy.
But this is just one way to look at it - ideally it should be exactly as you describe - good service, simple exchange at specified price and confidence that the service is adequately paid for the job.
Only issue is that even in the EU this is often not the truth and restaurants would never ever afford to actually hire full-time employment contracts.
> Like yeah, you're having to ask yourself and that's friction. But shouldn't there be a friction when you're being served by someone who is an equal? I've seen folks treat service like garbage in the EU because that exchange obscures the fact that there is an exchange of money. And I've seen service fall back on apathy.
Interestingly, I arrive at an entirely separate conclusion - there is no way for equality in a relationship in which one party holds your financial security (for lack of better words) in their hands. How can the waiter be your equal in that situation, when they might have to act just to ensure they can make the money they need?
Yes, I have also been thinking how a similar reward system would work without tipping. Just use a bonus system based on customer feedback. And the flow could be very similar to how it is with tipping.
It's not worse than tipping, but we've already normalized the obnoxious idea that every transaction needs to earn five stars. You know the places. The ones where they warn you "You're going to get a survey, if there is any reason why you don't feel like you can give us a 5 please tell me" (unsaid: Please sir -- they flog us for 4 star ratings). I can't imagine anyone I know not rating an Uber 5 stars, unless they were say, called a slur or the driver caused an accident.
So, I'm not sure how to best construct a system not open to "guilt gaming" in this way, but I would like to see one.
I do, it creates perverse incentives and dehumanizes people.
Imagine yourself catering someone and then having them talk about how great that is and wanting to pay you for that. Not in abstract but actually, in practice. It nails down the servant role, frankly. It feels abhorrent to me, even if you get numb to it over time.
From my perspective, tipping is a socially acceptable way to establish classes. Which itself is a terrible practice and the people catering you aren't your servants.
I used "catering" in this comment as a placeholder for any job that receives tips.
It really depends on the amount. In Belgium for instance there would be no tipping, but rounding up or adding one or two spare coins of change you still have on you in case the service was excellent.
It is like any job where people get a bonus because they have gone above and beyond.
What's worse, it adds "emotional labor" (if I may borrow that term) to a staffer's job; while it's expected for staff to be representative of their company, it really feels like staff in tipping establishments have to put on a show and fake persona to optimize the tipping. But likewise, if you don't tip or don't do enough you (as a customer) are treated like shit.
I'm too autistic to be playing these games and figuring this shit out. I'm glad I don't live in the US.
I spent half my adult life in Ireland, had kids there, built a house there, etc and like to think that during said time I learned a few things and noticed changes. I do think part of it related to POS systems normalizing it. But it is certainly possible that our experiences differed. It was more common in Dublin 2 than in Offaly I'd say...
Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up. And I spent much more of my time extolling Ireland's virtues than complaining about it! It was surreal to be chatting with taxi drivers and trying to make the point that Ireland wasn't an utter kip.
> Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up.
In Spain we tend to have a similar attitude. Not really telling people to shut up, but if foreigners criticize our country we tend to get defensive, even if they are saying things we would agree with or say in a conversation between locals.
For me it's like common sense, just like you don't acknowledge family problems when you talk to people outside close family and friends, but it's probably just the culture I've been raised in.
Yeah, but when immigrants to my home country complained we generally agreed. I mean, why wouldn’t people experiencing the same system have similar complaints?
Oh, OK. I was thinking about foreigners that are here just for a visit. Immigrants get treated like one of us in this respect. In fact immigrants soon experience the horrors of our bureaucracy when they need to obtain their papers, and this typically creates opportunities to bond with the locals by venting about it :)
> Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up
Haha nail on head here. On behalf of my fellow Irish people - sorry!
America has spent the last century proclaiming itself the greatest country on earth, whilst simultaneously causing untold political and social problems in "lesser countries" to its own benefit.
Some deep rooted resentment when an American criticises a place is natural.
> Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up.
Not to be rude, but have you considered this may have been an issue with you and your attitude, rather than everyone you met, if even people who you seemed to think liked you couldn't stand you.
No, not really. My experience there was generally positive and I met lots of great people. That being said it’s fair to observe that different cultures have different traits. I have a friend here in the Netherlands from Roscommon and he gives out about Ireland -much- more than me, and when I mentioned we’d lived in Offaly he described it as “the beating heart of Irish begrudgery”, which checks out.
Anyway this conversation is a net negative to my day and I’m bowing out.
"Not to be rude" my hole. What @CalRobert said is 100% accurate - only we are allowed to criticise Ireland, and criticism is especially unwelcome from Brits and Yanks
I disagree. Irish are _much more_ receptive to criticism of the country from immigrants than most countries.
In my experience, the United States and England (not the entire UK) have the thinnest skin and some people will straight-up tell you to f-off home on the slightest criticism, especially on the subject of human rights or the expeditionary wars.
There are of course the usual suspects, the racists and "Pro-Irish" crowd, who will blame everything on immigrants and accept no criticism of their imagined Ireland, but this isn't true in general.
However, if you make grand pronouncements from a position of profound ignorance and overtly judge the life choices of your new compatriots - a speciality of the GP - you will find yourself alienated at best. This is true everywhere, not just Ireland.
> I disagree. Irish are _much more_ receptive to criticism of the country from immigrants than most countries.
Unless, of course, the criticism is someone making a personal observation about how they saw tipping culture expand during their time in Ireland, right? Then the appropriate response is to generalize that Americans love making ignorant comments about other cultures.
> Unless, of course, the criticism is someone making a personal observation about how they saw tipping culture expand during their time in Ireland, right? Then the appropriate response is to generalize that Americans love making ignorant comments about other cultures.
Unless they're factually incorrect, which is the case here.
Well, they say they did experience it. You cannot possibly know otherwise.
There’s also another commenter in this thread who says they’ve lived in Ireland for their entire life and says they’ve experienced the same thing.
Then, there’s you.
There are two likely explanations I can think of for your behavior here. 1, you are arguing in bad faith. 2, you are unable, for whatever reason, to understand that others might have a different experience in the world than you.
In either case, I don’t see any point in continuing this conversation. Have a nice day.
Nah, born and lived here my whole life and requests for tips are way up, from just eat to payment terminals asking for 10% for things that maybe would have been untipped in the past.
This is why power/hegemony are good. This is what Euros get for their lazy, easy lives of "work to live" and siestas. You don't get to have your own culture anymore. Start working hard or continue to fade into obscurity.
It's not like you get better or more food, or get the food faster since all that depends on the kitchen that isn't getting tipped directly.
It's pretty much them coming to your table to take your order. I'd much rather have a free burger or drink (the equivalent of what I could get instead of tipping) with the slow service than get my water refilled every 5 minutes.
> It's not like you get better or more food, or get the food faster since all that depends on the kitchen
Oh, trust me, go to a decent place, be a regular, tip decently (not even extravagantly), you absolutely get looked after. For instance, several of my usual lunch spots my usual fountain drink is often "water" on the bill.
It's likely not like this everywhere but I've become a regular at a few places over my life time and asked about this. At least where I've been, it is actually all tracked. Generally, at least at bars, the people coming in and tipping well, are people who come in often and spend a lot to begin with so over the long run they end up making it back anyway. And honestly, when you're new to a city/place and don't have a lot of friends/are single, and you walk in somewhere and are greeted by name and served your usual without asking it's a nice retreat.
> so over the long run they end up making it back anyway
Yeah, they lose on the unit, but they make it back on the volume!
How are you both new to a city/place and they already know your name/usual before you've even tipped? Do they send runners out ahead with the information?
I've had similar experiences in all-inclusive resorts in Mexico and the Carribean where they stock your fridge. Leave a few bucks in the door of the fridge, it'll be overflowing. If you don't tip, you get the minimum. Tip the bell man well at the beginning of the trip, and every time you call the front desk things show up at your room real quick.
You know what works even better? Being a friendly and nice person. It has the added bonus that when they greet you and "treat you better" (whatever you mean by that) next time you’ll know it’s not just because of your wallet.
- Tipping results in lower pay for certain genders and races.
- laws that protect employees don't apply to customers. Your boss can't make inappropriate comments and pay you less if you complain. But if a customer makes inappropriate comments, its perfectly legal for the customer to pay you less if you reject their advances.
I don’t think any of this is fixed by banning tips.
As I said, tipping shouldn’t be mandatory nor required for someone to make a living serving, frankly, relatively wealthy people and experience.
If someone owns a restaurant, I can show gratitude by coming more. If my clients like me, they can show gratitude by giving me more business. If a server does a great job independent of their employer, a tip is a good way of showing that.
(That said, if a group of employees has agreed to no tips, they should refuse them and one shouldn’t push.)
When I visited the US I’ve noticed some waiters would treat you worse or just ignore if they found out you were a tourist, so when I could I would order something small and pay right away with tip, just to get basic service. So your comment makes 0 sense.
That feels disturbingly like a lite version of paying someone to be your friend. Maybe we should just all treat each other well (in both directions) and not reduce manners and social graces to a financial transaction.
I have, in the UK. Probably 95% of customers didn't tip. I didn't have any problems with this.
Why?
I was nice to people because that was my job, but when I've travelled to the US I have definitely seen entitled customers treat staff like shit and claiming it's their right because they were tipping.
Tipping as standard should go out the window, it just drives customers to be assholes.
I worked in a fast food restaurant here in the States, people tipped but usually not well. I wasn't pressed about it, I was getting a full minimum wage. Entitled customers didn't give me trouble for whatever reason, they seemed to size up my coworkers as softer targets.
> Why?
I was just curious about how OP's experience informed their perspective.
When visiting the States I have observed on a couple of occasions where a customer shouted at staff and used the threat of withholding a tip as leverage to be unreasonably nasty to wait staff.
The service industry in the US is awful, and the tipping culture is really toxic. I don't understand those that defend the American approach.
To be clear, I don't defend it. I'm mildly against it. Unfortunately I don't in it's at the root of entitled customer behavior in the States, I think there's a deeper cultural contempt for service workers. You'll see similar behavior towards workers who aren't tipped but who provide some sort of face-to-face service, like cashiers and teachers.
> Unfortunately I don't in it's at the root of entitled customer behavior in the States, I think there's a deeper cultural contempt for service workers.
Completely agree with this position. I didn't mean to say that removal of tipping would solve the problem, more that it is an enabler of toxic behaviour. The more opportunities provided, the more likely assholes will be emboldened causing a normalisation effect both in them, and others around them.
Something that has occurred to me is that I have sometimes been that asshole entitled customer, and as I've matured I've learned to remove myself from a situation when I feel the urge to yell at a service worker.
It has never been about the money really. The only exception I remember was when I was upset about the way my bank processed my paycheck and yelled about it in my early 20s (my bad, I didn't know how depositing checks at an ATM worked but I ought to have). But usually it's because I felt insecure or disrespected in some way (which wasn't, to my memory, reasonable. It wasn't what the kids call a "valid crash out".).
For instance, it really gets under my skin when I am talking to technical support on the phone and they try to blame the problem on my running Linux. Argh! If it was Linux I wouldn't need their help! I'd either fix it on my own or ask some help forum.
I don't know how much that translates to the larger phenomenon, I'm not even talking about face-to-face interactions anymore, but that's my two cents.
What's crazy is that you can so confidently claim "tipping is a thing of the past" when it's... not? You can think tipping should go away, that's a completely valid viewpoint. But your statement is just objectively wrong.
I see this a lot (not specific to HN) - some person doesn't like $THING, so they just declare that that thing is bad, or "a thing of the past," or whatever.
Or confidently declaring the _true_ motivations of companies/people, like they, the random internet person, for sure know why some company or a famous person are doing something, and express it as a statement of fact and an agreed upon common sense and not a speculation based on nothing.
Most seen on reddit but seems to be becoming commonplace on here as well.
"Horse riding is a thing of the past" is both clearly true and also wrong if you are being incredibly obtuse. The average person is not riding a horse, but there are still horse riders.
I see this a lot - some person doesn't like a phrase ("a thing of the past"), so they just misread it and take it clearly the wrong way.
Anecdata, but I go to Taco Bell way more often than I should. There’s no tipping culture at Taco Bell, but the staff, at least at the one near my house, are always very nice to me and as far as I can tell my food is made with a sufficient amount of care.
When I do go to a restaurant that has tipping, people are usually nice to me as well, but I don’t feel like they’re really any nicer or better at their job than my local Taco Bell workers.
No, they're definitely more attentive for the tip, I just don't like it. If they're going to be extra nice, I don't want it to be for money. Felt nice going to other countries like Australia where the customer isn't always right but they still do their jobs.
Anyone who has worked in a restaurant or bar can provide plenty of observational data that if you provide better service you will be tipped better. I would recommend trying out working as a server/bartender you will understand tipping a lot better.
This statement is just not factual without some qualification. Where I live, and in the US in general, tipping is not a thing of the past. You can say you wish it was, you can say it should be, but what you said is not factual.
Tipping is a thing in Eastern (to be more accurate: Central) Europe too, but where I live, tipping is not taxed. Actually, let me be more accurate: people who pay with credit card always tip in cash, as there is no way to tip with a credit card[1]. :P If you buy anything with a credit card, the total amount must always be identical to the sum of the prices of the products, it can never be more, so cannot include tips[1], which forces people who tip to tip with cash.
Food deliveries (similar to Uber Eats in the US I suppose) have the option to tip, and 100% goes to the courier. 200 HUF (0.57 USD) is the most common amount (as per their website[2]). We do not use percentages.
"Cash is untaxed" is a universal rule; there's a food stall that only sells deep fried Vietnamese eggrolls (and has for decades), they prefer cash; in part because cash is untaxed and they may forget to document every sale on occasion, but also because they do relatively low amount transactions (<€10), the €0.25 transaction fee does add up for them.
It's also why "knowing a guy" can be useful, tradesmen coming in on their off hours to do a job for cash.
>>Actually, let me be more accurate: people who pay with credit card always tip in cash, as there is no way to tip with a credit card.
Eh? I don't know if you consider Poland eastern europe(I don't really), but I tip with a card all the time in Poland, you just ask "hey can I leave a tip on the card" and they bump up the amount by whatever you want to tip. And no, the amount doesn't then equal what's on the receipt - I don't know how they work it out internally, but frankly that's not my problem.
I'm from the UK and travel in the US a lot and US service is much better. I've never had to chase up the check or had to go and search for staff to serve me after sitting there for ten minutes. These are common occurrences in the UK for me.
Ideally, tipping wouldn't exist and everything would be priced in, but pragmatically, incentives grant extra benefits to both parties. Potential for more money for the server, better service (and the ability to punish bad service) for the customer.
(I know everyone making similar observations is getting voted down, so I appreciate I may simply be far off the bell curve on this and the majority experience the total opposite. But it's my reality.)
> I'm from the UK and travel in the US a lot and US service is much better. I've never had to chase up the check or had to go and search for staff to serve me after sitting there for ten minutes. These are common occurrences in the UK for me.
I've had these things in the US. In fact the service generally I've had is all for show, people being really "fake nice" and / or overbearing but then forgetting drinks or food items you ordered.
At least in the UK you can genuinely not tip someone without worrying about them being unable make rent..
I’ve had fantastic service in countries where tipping is not the norm. I’ve had atrocious service in the US. UK service may be worse, but I doubt tipping is the reason for it.
Good service is common in industries where tipping doesn’t happen. What makes restaurants special that their workers can’t provide good service if all of their pay comes from their employer just like everyone else’s?
If you’re in the US and refuse to tip, you should consider only eating out at places that pay more than the tipped minimum wage (in many states still $2.13 an hour). If you’re going to protest with your wallet, hurt the owners and not the staff.
> and have the restaurant pay their people for their work.
For that, you need the restaurant employees to be organized in a strong, independent, non-corrupt union; or a highly-upstanding restaurant owner/manager.
The latter is sometimes the case, but often/usually - not.
So, former is rarely the case, I'm afraid, because working-class consciousness in many countries is lacking; and forming a union is hard; and restaurant staff have a lot of churn, so by the time you get the idea to do this, or have started work on it, you might be going elsewhere.
But regular restaurant clients taking owners to task about wages is definitely a thing to consider...
“Tipping is a thing of the past” is just a completely false statement, given it’s the norm in the most economically powerful country in the world and not at all u heard of elsewhere (food delivery in many countries, high end restaurants in the UK and elsewhere, etc.) If we’re being generous we can call the claim is vs. ought distinction, except the phrasing doesn’t even leave room for the ought interpretation. It’s just a falsehood (were it was true).
Not sure you know what tipping is, but it's not paying for the meal. It's paying for the service.
1. I like being able to pay for better service
2. Despite what people like to think, everywhere in the world has appreciated tips. I've never had a waiter refuse extra money. Literally dozens of countries, you get better service if you tip.
The cost of a ”meal” in a restaurant is: rent, wages (for chefs, managers, wait staff, etc) ingredients, profit margin, taxes and likely a dozen other things.
Taking one of these items out of the cost and trying to charge it separately is a strange practice.
Not sure where you have (or haven't been), but I've been to several countries where I've tried to tip, and it's confused or even embarrassed the staff. They insisted I take my change. Granted, this was 15-20 years ago, and unfortunately tipping has become more pervasive, not less, so maybe if I were to revisit those places, things would be different.
But I do know this is still the case in Japan. Some Japanese service workers or small business owners will even be insulted if you try to tip.
Having just come back to the States from a trip to Europe — sheesh, I hope not. The service at restaurants everywhere in Europe was at best mediocre, and typically god-awful. Incentivizing good service is good.
Yes, yes, "but the price on the menu says..." Whatever. If you're in the U.S., it's normalized that the price you actually pay is 20% higher, assuming they treat you well. Restaurants don't typically print the tax on their menus either, and yet no one tears their hair out over having to pay sales tax, and various city taxes, etc etc.
The service is so, so much better in the U.S. because of tipping. Tipping culture is good.
Tipping sucks and your taxes suck too. When I see that something costs 15€ on the menu then I expect to pay 15€ and nothing more. How can you be happy about surprise taxes? How can you plan your spending when you don't see how much something costs and you still think this is superior?
I dunno, I was in Europe (Belgium and France) last summer, and I thought the service was generally excellent. A bit slower in France, perhaps, than in the US, but I chalked that up to people just generally not being in as much of a hurry as they can be in the US. (And hell, there are plenty of places in the US where service is slower than I'd like.)
We tend to avoid touristy areas, though, when we travel, so maybe that explains the better service. If I had to work in a service job that caters to tourists, I'd probably be less happy too.
I'd expect all prices to include taxes, be it restaurants or other shops. Everything else is just making it harder for the customer for no reason at all. What you see is what you pay.
Service is quite good in Europe if you ignore the touristy areas. We’re also not into that fake-smiling thing, so maybe that can be seen by an American as “bad service”.
On the other hand, when I visited US on a work trip we've had an absolutely awful service at a restaurant, like the waiter was genuienly rude to us, and at the end I said ok, well, this was awful, I guess we're not leaving a tip then - and our American host laughed and said no, you still have to leave a tip. Why? Because it would be rude not to. And these people earn very little so you have to leave a tip. But.....the service was bad? Why would we tip? "because you have to".
That's nonsense. In the UK if the service is good I leave a tip. If it isn't then I don't. From my (limited) experience in the US it looks like you have to tip regardless. If that's the tipping culture then that culture is rotten.
>>The service is so, so much better in the U.S. because of tipping.
Honest question - do you consider waiters who ask you if you need anything every 2 minutes "good"?
>> The service at restaurants everywhere in Europe was at best mediocre
What's your opinion on restaurants in Poland? Was the service better or worse than in Spain? How was it compared to Czechia and Slovakia?
> At the outset of the Amazon Flex program, from 2015 through late 2016, Amazon paid drivers at least $18 per hour plus 100% of customer tips
> Beginning in late 2016 ... Amazon secretly reduced its own contribution to drivers’ pay to an algorithmically set, internal “base rate” using data it collected about average tips in the area ...
> For example, for a one-hour block offering $18-$25, if Amazon’s base rate in the particular location was $12, and the customer left a $6 tip for the driver, then Amazon paid the driver only $12 and used the full customer tip of $6 to reach its minimum payment of $18 to the driver.
And their punishment was just to pay back what had been taken: I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back.
In this case[0] the CEO (Chris Kirchner) stole ~20M$ from the company causing employees to go unpaid for months, and outside of California all they got was owed wages (no interest or anything). While mentioned in the article, what he was mainly convicted of was defrauding investors rather than stealing from employees.
> Apparently, projecting personal prosperity was more important to him than making payroll
He actually had the temerity early on in the debacle when he was still pretending there was money to tell us that they had decided to not pay us that week because it would be bad for the companies investments to withdraw funds then.
> I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back.
There was a very famous viral video of a woman stealing offering to just pay for the goods when she was caught, but we all understood why that was a ridiculous idea. Maybe she was just an Amazon VP, so she didn't know any better
My tips have been going down progressively, when I moved to the US I was taught 20% is "normal", now I tip 15% at MOST at restaurants and at MOST 5% on take out.
I'm tired of being shamed to pay more for less.
Also whoever was in charge of teaching staff to "turn away in shame" when the tipping screen is shown needs to go to some sort of gulag.
Not sure how is it now, but when I worked in a plant overtime work was paid at 150% rate of regular pay. Work during national holidays was paid at 200% rate. Isn’t this still the case?
(The workforce at the plant was unionized and the higher rate may have been part of the labor contract. This was in Montreal Canada about 25 years ago. )
I, personally, believe tipping is detrimental because it encourages preferential treatment. When workers know someone is a generous tipper, they often provide better service to that person than to others who tip more modestly.
In many cases, tipping functions like a form of bribery, incentivizing employees to offer favors or services beyond what is appropriate, which can come at the employer's expense.
It can also create resentment toward customers who don't tip, leading workers to offer poor service and fall short in their duties.
I can kind of see the average traditional service work position to shift into a Uber-esque model where you are a essentially a gig contractor. The worker takes the full risk for slow days, and the business owner does not have to pay you a salary, as everything comes from the customer.
Just a historical note as a consolidated response to those who identify 'tipping' as an 16th through 20th century invention. This is incorrect as humans had 'tipping' all the way back to earliest recorded times.
In the middle ages vails or informal rewards were given to well performing servants. In the Roman times corollarium (Lucilius, Seneca), a form of tipping was known. Cicero referred to tipping as stipen although some argue that is not above regular pay.
There are some evidence that in the Han Dynasty, gifts were bestowed on well performing eunuchs, above their normal pay. Considering that in ancient times payments often were in non-monetary compensation, this could be considered a progenitor of tipping.
Incas had similar systems of rewarding service with goods like cloth, though not exactly like modern tipping.
Tipping, as we understand it today, likely did not exist in the same form in ancient civilizations, but there were practices where extra gifts or payments were given for exceptional service.
> What has been will be again, what has been done will be done again; there is nothing new under the sun.
It's been a very long time since my last visit to the USA. I probably paid tips in cash back then. I would assume that workers can chose to never report those tips as income, or not all of them, so no taxes. But if everybody went cashless by now, customers probably pay the restaurant, the restaurant pays the tips to the workers and all of that money is tracked and taxed. Is that correct?
This is unlikely to be allowed, the last I checked, the law explicitly only allows "traditionally tipped jobs". How it gets interpreted and implemented in IRS Tax Code isn't clear yet, but they will probably have rules in place to prevent this.
Doesn't change the fact that it is a terrible idea.
Hmm, this makes me wonder though -- I have noticed various projects on Github and various other sites allow for users and fans of projects to donate to the developers and maintainers. Who hasn't seen the "wanna buy me a coffee?" button on a site before?
I am not sure if the money from such sources was ever taxed as income, but if so, then I wonder if such will be non-taxable now? Considering donation and tip buttons have some history behind them, perhaps such "jobs" could be considered "traditionally tipped jobs?"
At least the current version of the code has a ton of limits on what can be labeled tips, and the benefit phases out completely around $150k, and is only applicable to professional that traditionally receive a significant portion of income from tips - so it's not like you're going to have billionaires and PE fund managers paying themselves from their companies tens of millions in bonuses labeled as "Tips" and not paying any tax.
~90% of tipped workers REPORT less than $61k in income already. At that income, you're barely paying much income tax anyway.
This is just a trick to make people think they wouldn't have to pay social security and Medicare - which is the main tax they're paying - when in reality, ~90% of tipped workers will get next to nothing.
My daughter works at a mid-tier restaurant 35 hours a week and makes more than my wife who is a math teacher, department head, and has many years of teaching experience.
Eliminating tips and increasing the base wage is a stupid idea. All the talented servers who love the job will leave and mediocre people will replace them.
Doesn't this also open a huge opportunity for tax evasion?
Say I am a small business owner selling a $90 item which is $100 with state sales taxes. I say if you are willing to tip me at least $90, the item is $1. The buyer saves $9 from state sales taxes, and I save on income taxes because tips are exempt from tax.
Yes, this rarely seems to come up in discussions of restaurant tipping culture in the US but especially given that a lot of municipalities have additional hospitality or food and beverage taxes over and above sales tax, there’s a strong incentive to keep menu prices low by encouraging tipping, as a way to minimize the taxable portion of the bill.
If I need to make sure a server earns $200 after tax for a shift in order to be able to attract them to work for me, it is definitely to my advantage for as much of that money as possible to come directly from the customer as tips.
It's fascinating to see the correlation in opinion between taxing tips and raising the minimum wage.
If the prevailing sentiment was to make things easier for low income workers, I would expect people to want to not tax tips, and increase the minimum wage. And people who want less government interference, would want less tax, and lower minimum wage. Those are the two opinions I expected to see.
But instead it seems like people want to tax tips, and increase the minimum wage, which is evidence of a kind of authoritarianism that I did not expect.
Tips are still income. If we increase the minimum wage so that people can afford to live then I can't see any reason why we wouldn't tax tips also.
If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break. A better solution would be to prevent restaurants from paying their people poverty wages, and if servers aren't risking starvation and homelessness if they go without tips for a week then why would you not include their tips in their regular income?
Raise the minimum wage, require servers to be paid minimum wage, and enforce a straightforward tax on people's income that doesn't distinguish wage from tips. Maybe also increase the 0% tax bracket to something more reasonable, like $20-40k, just to simplify things for people who are struggling to subsist while we're at it.
There is no jurisdiction in the US that allows servers to be paid less than the standard minimum wage. Even where you find server minimum wages (your $2.50/hr example, although not all states allow this) the employer is required to top up to the standard minimum wage if tips don't cover the difference.
Which makes this kind of silly,
> If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break.
If $2.50/hr + tips exceeds minimum wage, why do you need a special break? You're making more than other minimum wage workers. If $2.50/hr + tips does not add up to minimum wage, the employer has to get you to minimum wage, so you are making no less than someone else making minimum wage.
If people with low income need a break, just give people with low income a break. How that low income is derived is irrelevant.
Tax on real tips i.e. cash was already unenforceable, but perhaps it's nice to codify it. Then again, it feels like just another step to shift transactions away from cash.
"Y'all" would be pretty silly to ask a question of little relevance.
Why wouldn't I ask them whether they were happy with their overall compensation, including health benefits, retirement, hours being scheduled, vacation or sick time.
Should I ask those in the back who may or may not be getting the tips from the table?
Tips are supposed to be "in return for a service, beyond the compensation agreed on" (WordsAPI).
If tips instead mean "it's something you have to give when you had no problems with the service provided", and you expect routinely not to have problems with such service providers, then it's implicitly agreed that tips are required, so they are not tips anymore.
It’s simpler than that. It’s gross vote buying and political patronage. Nevada has a large population of tipped service workers. Trump won the state by the largest margin for a Republican since W. Bush in 2000 (back when the state was 65% non-hispanic white versus 45% today). It was probably instrumental in Trump winning hispanic men nationally.
It is interesting that the no tax on tips would expire in 2028, while the tax breaks, most affecting the wealthy, were made permanent in the same bill. A bit of political game i'd say.
Also, "The maximum annual deduction is $25,000 for individuals."
Taxes are still being assessed, and tips over $500 a week won't have their tax refunded.
Some rhetoric during BBB debate was a side effect of a similar political game; cuts for "middle class" in the Tax Cuts and Jobs act from 8 years ago were due to expire, benefits for corporations were not.
"No tax of tips" is one of the most brilliant political ploys ever. You really gotta give Trump credit. It doesn't really cost anything, businesses love it, and you can trot it out as a victory for the working class while you screw them on their health care or energy costs.
It’s not really, it’s the kind of thing that only a populist could do. If a Democrat did this, people would hate it for this very reason. This would just another “NeoLib” concoction to screw the working class.
I’d honestly like to hear from someone who is a proponent of tipping how they think it makes any sense. By that I don’t mean I need the reason for tipping explained to my, everybody understands the argument for why you should tip: but how does it make sense when you consider who you tip and who you don’t?
I’ve finally eliminated all tipping in my life for anything that isn’t sit down restaurant service or an uber ride, and I’ve stopped using delivery apps to instead just pick up food myself.
At first it feels shitty hitting 0 or “no tip” on a payment machine but after the first several times it feels empowering and I doubt employees give a shit anyway. Just do it.
You have a farmer that grows/raises food, butchers and others that 'process' it, you have a team of cooks who prepare/cook the food, and you're supposed to tip the the person who just brings the foor from the kitchen to your table, maybe 20, 30 meters away?!
Sadly, tipping is sprading all over europe too with POS terminals bothering you more and more often for tips.
I grew up in France and tipping in restaurants was definitely a thing, albeit on an entirely different scale than in the US.
Leaving a few francs (I'm not young) was common practice.
With cash payments growing more rare, and without the ability to tip easily with cards, maybe it became much less common.
That said, I don't disagree with your comment on how it's spreading. What I don't love about the terminals asking for tips is that, IMO, it creates an expectation of tipping that wasn't there before.
Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant.
On the other hand, we regularly eat out at a place near us that only takes cash. We usually spend about 18€ and I always leave the extra 2€ as a tip.
>Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant.
I've lived in Portugal for 30 years and I never had that happen to me. Where are you seeing this? I could only imagine it in a place that only serves tourists and foreigners.
But today, who's getting tips in cash? Not many. Customers are paying for everything with credit cards or contactless, save for the occasional cash-only coffee shop or restaurant.
About half of the large tips at high end restaurants in my town are cash. Sounds like it is about a third in New York. Especially if it is folks who work at a restaurant.
Exactly. My girlfriend who works in sales (sells food) in LA barely gets tips in cash. Most people use their cards. And thus, her tips are tax deductible.
I should have specified that I live in the east-coast United States. Tap-to-pay is almost as common as someone writing you a paper check or an IOU, out here.
I have an honest question: what's the cash vs card tip ratio? 99.999% of the time I am not carrying cash and I don't see many (any?) people paying with cash ANYWHERE in the last 10+ years.
At this point you are litterally a sucker to pay for anything in cash, because everything is marked-up to cover CC fees, which you get a portion of back in the form of rewards.
Yes, I know some places give cash discounts. Most do not.
Almost no one can give you a good answer because it varies by business type and location.
My business does not involve tips (exactly) but I can tell you that I’ve seen anywhere from 20-40% of money run through my system being in cash, depending on where I am in the country.
NYC here, whole lot of cash still showing up in tip jars - there are still and loads of cash-only places around, from bars, restaurants, to street carts, you name it. JG Melon, for instance, is famously cash only. But so too is the bar around the corner from my apartment (Dynaco, do recommend).
...So people often tend to be carrying cash still.
Haha, I had the same thought but now basically everyone is digital so I think its a different ball game than we are used to. At least as a restaurant server/bartender.
The negligence of their national responsibility will be felt like an earthquake by millions of Americans. It's hard to imagine how they live with themselves.
We had to declare our tips at the end of the night, and 10% was the lowest you could claim without needing manager approval. You can guess what everyone declared.
How is an expected tip different from a commission other than who pays?
This is rather brilliant.
* make it look like the government is stealing “gifted” money
* stop taxing it
* turn as many jobs as possible into tipped jobs supposedly for the person’s benefit
* really the employer wins since they’ll pay less and claim “tips”
Yeah we just had to sell out medicare, bomb Iran, destroy USAID, and now restaurant workers can blame the public more for their thief employers not paying them a living wage. I have happily nearly eliminated eating out partially because tipping has become ridiculous but restaurant prices are still very high post-pandemic. Fuck tipping.
I worked as a server for about a year in college, and when we would check out at the end of the night, literally, everyone would just put zero. As in they didn't earn anything. Every time. I'm sure it mess with the taxes in someway or another.
I think with any conversation about tips it is really important to recognize that laws vary dramatically across states[0]. I think talking about this can really drive at the real underlying issues with tipping.
IMO most discussions about tipping are a distraction. "Divide and rule" if you will.
== THE LAW ==
(or my best understanding. IANAL)
For most of the west coast (AK, CA, OR, WA): there is no separate "tipping wage". Tips are *always* on top of *at least* state minimum wage. There is only one minimum wage, so tipping is always a "bonus".
Other places, there are two "minimum wages", but that's confusing because at the end every employee has to make at least the normal minimum wage. The difference is that employers can use tips as credit against this. So, with the exception of Georgia (WTF GA!), employees *must* make the state's minimum wage (default federal). Using federal (min wage = $7.25) an employer *MUST* pay you *no less than* $2.13/hr. This is conditioned that you have made *at least* $5.12/hr in tips. The problem here is what tips count to what wages. Per day? Per week? Per paycheck? DOL says "workweek"[1]
============
So the real (main) problem is actually just straight up good old wage theft. Anyone who is not getting at least minimum wage is suffering from wage theft.
I've heard stories of employees not getting a paycheck "because employer thought it was all tips" (illegal b/c they credited too much) or very small paychecks with the explanation that the employer over-credited tips. There's at least a decently straight-forward way to show what can be credited, and this is why there's the tip amount that you log. Ignoring cameras, the burden is on the employer to prove that they can make these credits, so that line-item on the bill is important (IANAL)
Personally:
I think the entire discussion of tipping often only serves as a distraction to wage. Like there's a lot of person to person fighting of how much we should tip (including not tipping) and frankly, doesn't this discussion often boil down to wage theft? I mean ignoring the already illegal problem of wage theft, what makes a server (who gets tipped) any different from a cashier (who doesn't get tipped) as an employee. Their jobs differ in duties, but we're talking about wage and *fair pay* here. If all the laws are followed, a tipped employee strictly benefits from tips. They have a statistical wage but that wage is max(base_pay, state_minimum) + random_value.
So I think 90% of discussions around tipping end up just being a distraction to create a fictitious divide of "minimum wage workers" vs "tipped workers"[2] who should instead be working as a coalition to increase the floor. They are both minimum wage earners! The main difference is primarily that tipped employees are just more likely to suffer from wage theft, due to how they are paid. But that's also something that both experience, just at different rates.
TLDR:
Getting rid of tips as a concept is a simple solution to the wage theft problem, but isn't the real problem just good old fashion wage theft? (second problem being "is minimum wage minimum"?)
According to my accountant for my wife’s small business (nail and wax salon) this tax law change will have a significant positive impact on her staff. Not sure what to make of this article, it seems pretty disingenuous.
N=1. Just because your wife's business doesn't fall under the conditions that the article is talking about, it doesn't mean that her business is the norm.
I'm just planning on tipping less to make up for it. In California minimum wages are already $20/hr, and on top of that so many places expect a higher %ge, tip, just cutting my tip by the 10% they pay in tax and being done with it. I pay taxes on my wages. They should too
https://archive.is/20250731232051/https://www.newyorker.com/...
Some interesting points: ~40% of tipped workers don't make enough to get taxed anyway, no tax on tips would actually advantage better paid workers like casino dealers who don't need the help. NToT is described as a campaign to distract from minimum wage increase initiatives.
That’s a weird way to say a sizable majority of tipped workers do pay taxes and will benefit from this.
Beware the logical fallacy. "A implies B" does not mean that "not A implies not B".
Workers who earn too little to pay taxes (A) will not benefit from a tax cut (B).
But workers who earn enough (not A) may still not benefit (not B), for example because their employer indirectly pockets the difference. That is actually being argued in the article.
So this is indeed the appropriate way of formulating the statement: at least 40% of workers will demonstrably not benefit from this.
Pretty sure they are aware, they included the qualifier "a sizeable majority" instead of implying it applied to all.
I can't read this article because of the paywall. Are they saying that taxable tips are subject to payroll taxes (which employers pay out of pocket)? That would actually benefit both employers and employees in some sense.
Some tipped workers, like bartenders, can make more in tips than a junior software engineer lol. Less taxes definitely helps their cause.
If you are concerned with indirect effects, there's quite a few pros and cons that you could extrapolate from the no tax on tips policy. These arguments are far less compelling in general.
https://archive.is/20250731232051/https://www.newyorker.com/...
> Some tipped workers, like bartenders, can make more in tips than a junior software engineer lol. Less taxes definitely helps their cause.
neat, but you can only deduct up to $25k and the benefits phase out if you earn more than $150k (single filers).
I think most bartenders would appreciate an extra $25k.
I am sure they would! but that isn't what the law says. Its a $25k DEDUCTION.
If someone earned $125k salary + $25k in tips. Their taxable income would decrease by about $6k (or $500/mo, 4% overall).
Okay. I think they would also like an extra $6k.
Deducting 25k does not mean taking home an extra 25k. It means, probably, somewhere around $1-3k, depending on their tax bracket.
That's...not how it works, like, at all. It's a tax credit, not actual money that you pocket additionally from your existing paycheck. It also only lasts until 2028.
> I can't read this article because of the paywall
I just turned on reader mode in Firefox and then refreshed the page and got the article. I'm surprised how often it works. It often doesn't but sometimes it does.
But it would be true to say not B implies not A right? (contrapositive?)
In that case B would be "is not taxed on the income" and A is "part of the 40%" making the statement not B implies no A: "If you are taxed on your tips that implies you are not part of the 40%".
That seems correct. It's a pretty useless statement, but it is true.
The tax system is graduated. If 40% don’t make enough to hit a band where income is taxed, then you can assume it’s a gentle ride from paying no taxes to not paying much taxes. And anyways, payroll taxes are by far the higher burden for service workers than income taxes.
it's indirect tax credits for businesses that don't want to pay workers.
No, it isn't. It doesn't affect the wage they have to pay them. It just affects whether the employees need to pay taxes on tips.
It may not affect the wages they have to pay but may affect wages they pay if they pay above the minimum.
it will absolutely affect the wage they are paid, it will be used as a constant excuse to not pay more than the legal minimum (2.13/hr as long as tips are greater than $7.25/hr)... probably used to justify additional tip stealing that happens pretty much everywhere, people will tip less because of it
servers are treated like absolute garbage
Good servers are treated well and make good money.
This is nonsense for most jobs, and it's nonsense here too. Very rarely are any jobs treated on pure merit of good vs bad performance. Ultimately it ends up being mostly the luck of having reasonable management and good opportunities. Reasonable management is very hard to come by in the restaurant industry.
And either way, if you wanted to believe the merit-based approach, you're talking maybe the top 5% of servers anywhere making "good" money. Wage theft in the industry is colossal.
I will be pleasantly surprised if the removal of tax on tips does absolutely anything to move the needle for the bottom 95% of servers.
The restaurant industry has been lobbying for this to further avoid the pressure of raising wages and the complication of reporting taxes — the reasoning is out there in the open.
This is the sort of modern shell game where corporate interests further obscure costs to trick the lower class into thinking it's a good deal. It's akin to the math on maintenance Uber drivers tend to fail to do when they're calculating their wages... they're absolutely getting hosed and most of them don't even understand how.
You can just look this up, it's not a secret. Median total pay, including tips, in the US is $32k for waiters. In France, it's €22k. The UK is £23k. Even factoring in health insurance costs — ~4.5k/year for an Obamacare plan — waiters make more in America.
Waiters in the US make significantly more than their British and French counterparts, due to tipping: the US minimum wage is lower than the British and French minimum wages, and despite American waiters being paid at an even lower hourly rate than the US minimum wage, they end up making more due to tips, performing the same job.
The upper 25% of waiters in the US make over $40k a year. Your 95% estimate is very off base.
yeah just ignore cost of living differences and rampant wage theft I guess
There is no useful point to saying what you just said.
You can make that argument about literally anything that reduces the tax burden on people who's primary income is useful income.
Correction: primary income is earned income
Well, to be fair, the IRS considers the average tip to be 8% for taxation purposes.
The whole "I get taxed whether you tip me or not", "I have to pay to serve you if you don't tip"? No, not so much. If you can show (there's even a hugely burdensome IRS form that might take as much as 3-4 minutes a month for cash tips) that you earned less than that 8% average, then that's what you get taxed. But most servers don't want to fill that form out, because they get ... rather more than that, and are being undertaxed already.
Sure, but TFA makes clear that any benefit to workers from tax-free tips is laughable compared to the numbers of times the restaurant lobby has fucked them over, by repeatedly killing attempts to keep wages low. It's not even throwing workers scraps, it's more like throwing them crumbs.
and it’s a not even a forever thing like the rich guys got. this thing sunsets.
They may not pay any income taxes, but they almost certainly pay FICA taxes. If the NToT includes FICA, they would be better off. However, I still think it is terrible idea to advantage some employment classes and means of compensation over others like that.
Yes, creating special exceptions like this is an awful idea.
More carve-outs complicating the tax code and pandering to specific constituents is a bad thing.
It reminds me of listening to a story of how day care business owner-operators are not required by law to contribute to Social Security, don’t, and are then screwed at the end of their life because they don’t have any way to retire.
No tax on tips does not apply to payroll taxes (FICA).
[dead]
https://jacobin.com/2025/07/restaurant-industry-tipped-submi...
https://jacobin.com/2020/10/tipped-restaurant-workers-waiter...
https://cepr.net/publications/customer-tips-are-providing-th...
I live in California and this isn't true here. All restaurant workers receive at least minimum wage before tips. In my city, that's $19/hour with health insurance.
Of course, you're still expected to leave a tip and suggested minimum is now 20%, plus even McDonalds is charging $15 for a 4 oz burger, so I rarely go out to eat at places that expect a tip anymore.
I'm not sure why they specifically should be tax exempt though. Cash tips often were, practically speaking, so a lot of tax evasion was happening, but it still seems odd to single them out.
Yeah, there is a lot of shadiness going on these days. I don't think tips should be requested in any sort of transaction where the employee gets paid more than minimum wage. Restaurants always had this weird system where you could avoid paying your employees if they were tipped, so it was drilled into everyone's head "you're stealing from poor innocent workers if you don't tip 20%". But this is not the case for most workers, and so tips should be truly for exceptional service in cases where the job position is on a normal pay scale.
This isn't to say that I don't tip when not required to or that I only tip people I think are being underpaid, but ... things have gotten a little out of control. If I feel like tipping, I'll tip. I do not need a prompt suggesting anything when it's not coming out of the employee's takehome pay.
I hate to say it but I think some government regulation is required here.
Peak tip cynicism is when you're at an upscale restaurant where the wait staff are obviously being paid more than minimum wage, the bill automatically includes a gratuity (often 18% or more), and then on top of that, there's a line to include another tip.
Another peak of cynicism is that the owners try to argue that the "service charge" is legally not a tip so it doesn't need to be distributed to workers.
Any fee or surcharge beyond the listed menu prices and associated taxes are a tip as far as I'm concerned.
If the restaurant is going to be shady and unilaterally introduce confusion to an already confusing norm, then I consider that norm voided and fair game for any interpretation.
It's not a "tip" if it's included. Biggest scam ever.
Upscale restaurants that tip is often being split 5 or 6 ways... not just the primary server, but also the bartender, sommelier, food runners, etc.
Seven states do not have a separate, lower minimum wage for tipped employees. Instead, they require employers to pay tipped employees the full state minimum wage, regardless of tips received. These states are Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington.
Sixteen states use the federal tipped minimum wage of $2.13: Alabama, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Nebraska, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, and Wyoming.
https://www.epi.org/minimum-wage-tracker/
There's a subtle but important difference in wording. There is no "lower minimum wage" for any employee anywhere. The rule is that employers may credit tips towards pay, up to a certain amount. And they can never credit 100% of pay.
So tipped employees should always earn: minimum_wage + stochastic_number
"lower minimum wage for tipped employees" is incorrect and is just the interpretation of "minimum employer must pay after applying tip credits". Subtle, but very different things! If you aren't earning at least minimum wage (tips inclusive), then your experiencing wage theft.
The DOL page[0] specifically says "Maximum Tip Credit Against Minimum Wage" and that's how the column "Minimum Cash Wage" is calculated, but under no circumstances[1] can the employer pay less than "Minimum Cash Wage". Anything less is illegal. ALSO under no circumstances[1] may an employee earn less than minimum wage.
[0] https://www.dol.gov/agencies/whd/state/minimum-wage/tipped
[1] We're ignoring allowed deductions like lodging and meal
Right, but if a tipped employee in a lower-tipped-minimum state doesn't make the full minimum wage when their tips are included, it's a lot easier in a place like that for a shady employer to fail to top up their wage. Yes, in theory there are ways for employees to get this enforced, but in practice they are very reasonably and understandably wary about making use of those legal avenues.
Not to mention that in a state where there is no lower tipped-wage minimum, all tips go to the employees directly. In a state where the tipped minimum is lower, tips effectively go to the employer for the amount between the tipped minimum and regular minimum, as that's a cost the employer would otherwise have to pay.
I knew someone who worked a graveyard shift at a Waffle House in NC. After their first month, when tips were distributed, they did not make the federal minimum wage, so they had to request additional pay to get to minimum wage (IIRC it was not automatic).
Waffle house then opened an "inquiry" since if they weren't making minimum wage through tips, it must have been because their service was poor (of course it's actually because it was a weekday graveyard shift).
They got their additional $30 or whatever and were then let go.
So while I agree it is illegal to pay less than federal minimum wage, even with tips, but in practice the system is built such that for poor workers in poor areas, they will frequently make less than minimum wage.
Although probably much less nowadays since the $7.25 is still the federal minimum wage and it's pretty hard to find people desperate enough to work for that little money since recent inflation.
This is a lot of words for a distinction without a difference.
What's the minimum quantity of money a server can be paid after a 1 hour shift?
If it's the same in both cases, that's his point.
I understand their point. What's the minimum a business has to pay for a one hour shift?
That's the point that all the parents above them are concerned with. So a semantic argument is needlessly pedantic.
> What's the minimum a business has to pay for a one hour shift?
Minimum wage. You can credit that with tips in some places, but you also have to credit the customer in those cases (not legally, but they aren't coming if you don't), so the net is the same.
To be clear:
We always need to make sure we distinguish a conversation about wage theft and a conversation about tipping. I think they are unknowingly being used interchangeably (or as an assumption in a conversation)[0] https://news.ycombinator.com/item?id=44751537 (sources linked here)
[1] Federal only lets max credit of 70% of min wage. Some states go up to ~75% of min wage, but their minimum wage is higher than federal.
Servers, often, seem to think it's our (the customer's) obligation to compensate for the sins of their employer.
"Many restaurant owners illegally don't actually follow this law". "Report them to the DOL". "I don't want to do that. You should tip me to make sure I have a livable wage instead."
Perhaps this would happen less often if people didn't just spread hopelessness
Or maybe that's a logical reaction to the situation these people live in.
Sure, it is logical. But that doesn't mean it is a good reaction. Certainly it doesn't help make the problem go away.
Don't confuse "logical" with "correct" or even make the false notion that there is a "correct" reaction. The "right" reaction depends on your goals, short term and long term.
But defeatist attitude results in a tragedy of the commons situation. It's social debt. Think of it like a mess. Messes are easiest to clean up right after they occur. But as time goes on, it becomes harder to clean. If everyone is doing their share of their work messes are very manageable. But if people don't do their share, then it must be picked up by everyone else, right? I think most of us have been in a situation where we've had to clean up "everybody's" mess (if you haven't, you might be that asshole leaving that mess). The defeatist attitude is like that person grumbling "it's too big of a mess, we'll never clean it up." Well... not with that attitude. If the mess needs to be cleaned up, it needs to be cleaned up. Either you help or you make it worse for everyone else.
> even McDonalds is charging $15 for a 4 oz burger
Jeez, where is this? According to the famous McCheapest map the most expensive Big Mac in America is about 8 bucks. Have prices really shot up that much recently?
https://pantryandlarder.com/mccheapest
https://www.yelp.com/biz_photos/mcdonalds-san-francisco-61?s...
What got lost in an edit was that's for the combo with a bag ($0.25 extra).
I'm happy that CA doesn't set a lower min wage for tipped workers, but the problem is that in many/most places in CA, $19/hr is still not a living wage, so the tips are more or less required to keep those workers housed and eating.
A living wage in most population centers in CA is nearly $30/hr.
People argued the living wage was $15/hour in California a few years ago. Then it was $20/hour. Now you're saying $30/hour.
I have to ask what is causing what's considered a living wage to increase so rapidly, because it appears to be increasing far faster than the national inflation rate.
It sounds like a wage-price spiral, though I'm not aware of anyone claiming we're in one.
You are seeing an environment that is highly conducive to a wage spiral, but so far wages haven't shown reactive enough to find that a spiral has set in. Comments like the above indicate that it wouldn't take much of a spark to see it ignite, though.
Granted, like a lot of things in economics, you can only tell in hindsight long after it has played out and the data is collected and analyzed, so it is also possible that the spiral is already underway and we just don't know it yet.
It's actually even worse than that. The $19/hr and health insurance comes from increasing menu prices, so with flat percentage tips, you're paying more purely for the privilege of paying more.
California doesn't have a special minimum wage for tipped professions? When I was waiting tables a long time ago I think my pay was $1.95 an hour. It was usually just enough to cover tax on tips (the ones we admitted).
The difference is where the money comes from: directly from employer vs directly from customer. But in all cases *the sum of these sources* must equal the minimum wage.
If the employee is not taking home at least minimum wage, then the employer is guilty of wage theft.
If the employer does not make at least $x towards an employee's wage, the employer is guilty of wage theft.
So instead, read the CA's (and AK, MN, MT, NV, OR, WA) rule as "tips may not be credited towards an employee's salary".
[0] https://www.dol.gov/agencies/whd/state/minimum-wage/tipped
You keep posting this over and over as if states with a lower tipped minimum are equivalent to states with the same minimum, regardless of tips.
You're not wrong that, in states with a lower tipped minimum, the tips act as a credit. But you're ignoring what the power imbalance in those situations can do to an employee, and you're ignoring the fact that in states like that, tips paid by customers are effectively subsidizing the employer out of paying minimum wage.
And I don't think that it would be surprising that wage theft is more common in places where the tipped minimum is set lower than the general minimum.
As a customer, I would much rather know that the employer is paying the full fair minimum wage regardless, and any tip I leave will always be on top of that. I don't want to be paying a part of the employee's wage that the employer would otherwise be paying.
I hear you, but your solution sounds defeatist. Like there's nothing that can be done.
Not effectively, literally. That is what a credit is.But I'm making sure that the conversation is clear that anyone not making minimum wage is suffering from wage theft. We have to identify the right problem if we want to fix it.
I also like this idea. I don't think there should be a wage credit. It is helpful to reducing wage theft. While I would, personally, get rid of credits I don't think I'd get rid of tipping all together. Certainly at least not until there's a better minimum wage rate. You're always doing this. Either your money goes directly to the employee or is going to the employee through the intermediary of the employer. In the case you are not directly paying the employee you're paying the employer.> If the employer does not make at least $x towards an employee's wage, the employer is guilty of wage theft.
See what your server's reaction is if you tell them to report this wage theft.
They won't. They'll just suggest you tip them to compensate.
They should. It's easy to report. Doesn't matter if nothing happens right away, because the more reports that accumulate the higher priority it becomes.
So instead of trying to tell me how fruitless this is and just give up to endless arguments, maybe report wage theft if you know about it. You can do it anonymously. You can do it for people that tell you. It's not a hopeless situation. Hell, lawyers take payment after the case is won, and you know if your wage is being stolen then others are too
It's easy to report, but retaliation is a thing, and is hard -- and expensive -- to prove. Someone subject to wage theft is not the kind of person who can afford that trouble.
And it's not like restaurant owners don't talk among themselves. Getting blackballed isn't great.
Bottom line is that you seem to think that there's zero reason why people are shy about reporting wage theft. And yet so many people don't want to do it. Maybe try a little humility on and accept that maybe there are reasons you don't know about or don't understand. It's very easy to tell people what they should be doing when you don't have to walk in their shoes.
It also is not expensive. At least not more than the theft. Lawyers working on wage theft generally take payment as part of the recovery. You pay out of the winnings, not up front.
Honestly, a big part of the problem is that many people have defeatist attitudes. A lot of people don't even bother to make a report after they leave. It is hard to retaliate when you've left.
[0] https://www.dol.gov/agencies/whd/retaliation
> it's not like restaurant owners don't talk among themselves
I’m sympathetic to the arguments, but this sounds like scaremongering.
If you have evidence of it, please post.
There are so many restaurants everywhere, just leave the worst place off your resume. I can’t see owners coordinating if there’s no online platform for it.
Looks like it changed in 1988 due to a state supreme court ruling about a 1975 law. The law said the tips were the "sole property" of the employee and couldn't be counted by the employer as wages.
https://www.latimes.com/archives/la-xpm-1988-11-01-mn-628-st...
They eliminated the special minimum wage for tipped professions in Seattle too, which is currently $20.76 per hour.
Nope. Tipped workers are paid full minimum wage in California.
California has not had a tipped minimum wage since at least the early 2000s, and I can’t seem to find any information on what is in the 1900s.
>Of course, you're still expected to leave a tip and suggested minimum is now 20%, plus even McDonalds is charging $15 for a 4 oz burger, so I rarely go out to eat at places that expect a tip anymore.
Don't tip, especially 20%, for over the counter service. That is ridiculous.
>I'm not sure why they specifically should be tax exempt though. Cash tips often were, practically speaking, so a lot of tax evasion was happening, but it still seems odd to single them out.
It's just a gimmick to get votes. The theory is that poor people tend to be the ones that work these jobs, they need a break, and it's not a policy that would cost very much anyway. There is a cap on the tips and most cash tips were going unreported anyway.
Don't forget to reduce your tips by the percentage they were previously being taxed, since it is all charity anyway.
Hopefully this becomes another straw that will eventually break the camels back and we get rid of tipping all together. Every restaurant in the world does not need tips to survive, except for the ones in the US.
This is going to expand tipping dramatically. I don't understand how you could have any optimism that tipping will go away after this is passed.
Businesses are going to work hard to blur the line between a tip and a required payment so that they can call their income a tip while customers think they're obligated to pay it.
Tips subsidize profits, plain and simple. But, America runs on poverty, so this is in line with the broader socioeconomic strategy.
> Tips subsidize profits, plain and simple.
Nah. Profitability for the business would be higher without tips. I take x% of gross income as profit. No tips means I can charge the customer more, which means a higher gross income, which means more profit. When tipping is involved, the money slips through without allowing the business to take its cut. Good for the server, but not good for the business.
However, as theoretically great as it sounds, you are ultimately beholden to what the customer wants. There is good reason why every restaurant that has tried a "no tips" policy has failed. Nobody shows up to dine. They go somewhere else where they can tip instead. Regular people actually enjoy tipping, as hard as it may be to believe for those who are staring at screens rather than enjoying the ambiance of a restaurant.
It's not that simple. Restaurant owners don't pay payroll taxes on tips, but they do pay it on regular wages. Raising restaurant menu prices by 20% (or the average tip amount) will not result in 20% (or the average tip amount) more going to the workers. Some restaurants have tried this out, and it's backfired. Restaurants already run on very thin margins; a loss of a few percent can kill them.
Also consider that customers will get sticker shock: even though they are ultimately paying the same price, seeing 20% higher prices on the menu will make them spend less. Yes, it's dumb, but human psychology is dumb, so there we are.
(Folks in Europe are used to the listed price being what they pay. In the US businesses don't generally list tax-included prices, but businesses that do include tax in their prices end up looking -- in the eyes of customers -- as more expensive than those that don't, even when the final prices are identical.)
"Some restaurants have tried this out, and it's backfired. "
Where I live, many restaurants have the "required 18% gratuity" thing and ask that you not tip beyond that. Maybe this is a PNW hippie specific thing, but a movement against tipping exists and is being ran by some good, successful, restaurants.
Making the tip required isn't a movement against tipping, it reenforces the idea.
Try increasing the posted food prices by 18%, or add a "18% owner boat fund", instead and see what happens. You won't last the week before you are bankrupt. The amount is exactly the same, so from a financial point of view there is absolutely no difference, but the experience of "helping out the little guy" is lost, and that will chase clientele away. For all the huffing and puffing we hear, actions speak louder than words. The reality is that customers like tipping!
Personally, I hate the whole concept of tipping as promoted in the USA.
I see it as a way that owners can avoid paying the relevant taxes for employing their staff and instead offload part of that payment onto the customers. The arbitrariness of it also annoys me - why just waiting staff?
I'm in the UK, so we mainly have service charges added to the bill to take the place of tips which is a much better system. I also like the Japanese culture of non-tipping and that they may get offended by customers leaving tips.
> I hate the whole concept of tipping as promoted in the USA.
Of all the ways people choose to spend their money, tipping is a strange one to hate. It is not like Taylor Swift pointlessly flying around the world to the detriment of the environment, and thus everyone. It seems pretty foolish, I get that, but fools and their money are to be easily parted. What is the harm in their foolish fun?
> I see it as a way that owners can avoid paying the relevant taxes for employing their staff
Assuming staff will be paid more. That is unlikely in a lot of cases.
Granted, if you are in one of the states that allows tip credits that would be more true given that they would be legally required to move up to minimum wage irrespective of tips, but many states require that staff be paid at least the full minimum wage already and tipping is still just as common in those places.
It is not like McDonalds is paying their staff more without tips (above excepted). Like the death of manufacturing saw an end to high paying manufacturing jobs, the end of tipping would see an end to the $50/hr. waitress. It wouldn't be supplanted.
> why just waiting staff?
You can tip whomever you want — or not tip at all. But in most cases only the business is liable, so it is the only entity you need to please. When alcohol is involved, however, the server becomes liable, so it is in your interest to grease those wheels else get cut off. It is not like anyone tips the waiting staff at McDonald's. It traditionally has only been a custom where alcohol is found for that reason.
But it wasn't long before people realized that they enjoy it! It gives them the thrill of "sticking it to the man", or "helping out the little guy", or in some cases "Look at me. I can pay you more than your own boss can! Aren't I great?". In fact, they liked it so much they have started tipping in other places.
> I'm in the UK, so we mainly have service charges added to the bill to take the place of tips which is a much better system.
That sounds like a tip by another name. How is that a better system? It seems exactly the same (except the customer can't easily opt out of it). Many places in the US do that too (oft known as an auto-gratuity), especially for large parties in restaurants, for what it is worth.
> I also like the Japanese culture of non-tipping and that they may get offended by customers leaving tips.
Whereas on the other side of the pond the opposite is true. I picked up some shifts as a server a while back for what is a long story, but suffice to say money wasn't my motivation. I was collecting a developer's paycheck at the same time, meaning, as I am sure you can math, I was making way more than 99% of the people I was serving, so I felt pretty strange and pathetic taking their "pity money", so I tried rejecting them.
That didn't end well. Customers started getting quite upset with me. In one case I bypassed the tip screen on the credit card machine and the customer not fully paying attention didn't notice and walked out without tipping. Five minutes later he comes stomping back in and gave me an earful about not taking his tip while shoving cash in my face.
I used to think like you, but once I actually experienced it, it became abundantly clear that the customers are there to tip in the kind of establishment that is built on that type of business. It is part of the experience.
Those sitting at home staring at a screen might not understand the appeal, but they aren't the customer.
> Restaurant owners don't pay payroll taxes on tips, but they do pay it on regular wages.
Payroll taxes in most jurisdictions are based on wages, not profitability of the business. A non-issue, well, except maybe for the server who has grown accustomed to making $50/hr. No tips and those days are long gone.
> Some restaurants have tried this out, and it's backfired.
Yup. Hard to win customers when tipping is part of the experience. I mean, it can be done where it isn't — McDonalds survives, thrives even, without tips — but if you are trying to run the type of restaurant where the customer comes to tip it doesn't fly. You have to give the customer what they want at the end of the day, else they'll go somewhere else. This is the challenge businesses face.
> Restaurants already run on very thin margins
Exactly, and if you increase the volume then the product of the margin gets bigger. Remember, Walmart and your average restaurant have the same profit margin! Walmart's advantage is that they handle way more money, so the total amount that margin represents is huge. If a restaurant can also handle more money...
> seeing 20% higher prices on the menu will make them spend less.
Even just, say, 1% higher still means more cashflow through the business, which means more cash to take a cut from. You are right that the full 20% would unlikely ever be realized, certainly not right away, but it doesn't need to be to still be advantageous. But until you figure out how to convince the customer to change their preferences about tipping, good luck.
There is absolutely no obligation to leave a tip. One only does so because they want to!
> Also consider that customers will get sticker shock: even though they are ultimately paying the same price, seeing 20% higher prices on the menu will make them spend less. Yes, it's dumb, but human psychology is dumb, so there we are.
It's not dumb; it's just that paying that 20% to the waiter is a lot easier to stomach than a 20% increase to the restaurant owner.
https://www.pewresearch.org/2023/11/09/how-americans-feel-ab...
Why do you take a fixed profit. Why don’t you charge the amount which maximises profit?
Because x% is the maximum profit. Not even places like Walmart, for all their might, have figured out how to exceed the same x% (somewhere around 2-3%).
I've already been doing that because I tip with cash. Credit card tip is self-contradictory.
Fascinating how America’s response to people being sick of having to tip on everything, tips being little more than a tax on generosity, was to make this most hated form of remuneration even more advantageous.
Since this was passed I just decided to reduce my standard tips from 20% back down to 15%. Figure it works itself out that way.
Agreed 100%. I will enjoy the creative financial engineering that likely comes with this policy, as we attempt to classify more and more things as gratuity, to escape the reach of the IRS.
That's because the business benefits from it the most.
> But, when three members of the group came forward to testify, all expressed support for the Tipped Workers Protection Act and opposition to the One Fair Wage Act, which they portrayed as an effort to steal their tips
This article is missing a real issue here by trying to make the story all about the employers. Many workers like the tip system because it creates inequality among the restaurant workers. Good servers can earn a lot more money than what they’d earn if every server were paid the same, fair wage.
My mom used to work at a furniture store as a floor sales associate on commission. She would regularly clear $120,000/year (this was 15 years ago, so like $180,000 today). A generous wage for the job at the time probably would’ve been $50,000 or so. She would’ve fought such a policy tooth and nail.
Is the definition of a good server in this case one who can serve more tables than others in the same amount of time? In most places tips are mandatory and % does not depend much on anything unless someone messed up.
Commission on sales is very different from restaurant tips.
Tips, at least in the US has never been mandatory but it is an immense social pressure. Besides, my understanding is that tipping % is arbitrary anyway - there have been studies that show good looking people get more tips.
I think tipping culture has changed a lot in the last 5 years or so, driven mainly by the point-of-sale machines that request tips for seemingly adding no value. I think people have reached the point of tipping fatigue.
Definitely. I also think it has blurred the lines even more, and exposes how arbitrary it is. Do I tip if I scan from a QR code and order, where I have almost no interactions with the server? How is it any different than counter service? All that changed is instead of self-service order it is self-service pickup. I probably still have to flag down a server to get utensils or water.
Why did the tip percentage go up from 15% as the norm to like 18-20%? It’s a percentage so if things go up in price so does the tip. At what point is it their job vs quality of service? Why don’t we tip fast food workers, because they probably face more abuse / deal with unruly customers more than dine-in (at least from experience).
Can you tell I think about this a lot? lol
I'm old. For me, tipping has always been a cash-only transaction because I felt the money going directly into the server's or other staff's pockets. The owner of the business never touched the cash tips, and the tips were rarely reported (for taxes). But now, when I tip with one of those point-of-sale devices, I have no idea where that "tip money" is going - does it ever reach the server or other staff? Does the owner just pocket the "tip money"?
> Does the owner just pocket the "tip money"?
Not if they know what's good for them.
It is usually against the law to do so, and enforcement is extremely pro-labor, so the only chance you'd have to get away with it is if it got swept under the rug and nobody ever complained. But people who work in tipped positions are some of the most ruthless people you'll ever meet (you kind of have to be when tips are your bread and butter), so that's never going to happen in anything but made up fantasy.
> Why did the tip percentage go up from 15% as the norm to like 18-20%
Why did it go up from 10% to 15% 50+ years ago? And why did it go up from 18-20% to 22-25% in the last few years?
> And why did it go up from 18-20% to 22-25% in the last few years?
Especially when they removed the separate server minimum wage at the same time, meaning that servers both moved up into the regular minimum wage and gained in tipping culture.
The final cost of the bill matters more than anything. A server at a higher-end restaurant where the bills regularly exceed hundreds of dollars will earn more in tips serving fewer tables than a server that works at a cheaper casual-chain restaurant (IHOP, Applebees, etc).
More so than tables per unit time, it's dollars per unit time. When I was a server, the usual metric of how well you performed on a given shift was the total of your bills ("how much you sold"). The best servers were good at encouraging parties to spend on the things they were on the fence about: the appetizer, the second drink, the dessert. Even with the volatility of individual tipping decisions, getting your tables to order more increases the EV of your total tips.
I haven't thought of that, makes sense. That likely applies more to higher-end non-chain places and tourist spots with lots of first time visitors. Regular customers will often know what they want.
I don't think you read the article. It explains that those three members who came forward were not actually servers, but restaurant management & owners. Additionally, the article is not missing this issue you call out. The author goes so far as to discuss Casino dealers in Vegas who would stand to gain the most out of this sales tax proposal (sales commissions in your anecdote do not count as tips). But primarily, the author is concerned about the 1/3 of tipped workers who do not pay federal income tax and are at risk of falling below the poverty line due to reductions in their minimum wage.
Sales' commissions and servers' tips is an apples-to-oranges comparison.
I think tips in many places are slowly converging into something like a 20% commission paid by the consumer, thanks to restaurants including a suggested tip on the screen or receipt, and bars automatically charging a 20% tip if you don't explicitly close your tab.
I hadn't thought of this before, but keeping tips as formally selected and paid for by the consumer may help the restaurant with liability issues where alcohol is involved. Paying servers and bartenders a direct sales commission might become an issue in court if a customer is overserved.
I've just stopped eating out because of this. Wonder how many people have. I don't want to be made to feel awkward at what is supposed to be an enjoyable experience for me. I especially don't want to be made to feel that way to manipulate money from me.
I used to hate those suggested tip things too. Now I got over my caring and just tip what I think appropriate. I mean when the restaurant sets the default to 25% or 30% that tells me they have no shame so neither should I.
Servers also know that if tips are outlawed, they will never make that much money again.
It's possible for high end bartenders or servers to make over $500 a night in tips. The whiplash of moving into true salary or hourly work is an open secret in the high end service industry. This is why you see some old waiters and bartenders hanging around, when some people consider the service industry "entry level."
This is also why I don't like to listen to them complain about their jobs lol. The difficulty of work to income ratio is unique to this industry.
Yeah, if you're lucky you can make a huge amount of money in tips - if you're the right server on the right night at the right place and get the right customers.
You can also, if you're not lucky, barely make anything in tips on minimal hours per week and then have your employer steal half your tips anyway, and then you're basically clearing $4.50/hr for 12 hours a week and probably ending up on food stamps until republicans eliminate those entirely.
Thing is, I've known freelancers who make great money, but even they can have a constant underlying stress about "if the work dries up I'm homeless". Imagine the same thing but instead of the work drying up your manager only schedules you for four hours a day between the lunch rush and dinner and the tips are minimal despite being there for the same hours.
Some people always like the status quo: no bloc is 100% consistent. With numbers like what you provide, though, this would be a minority of affected people... though, the ones with the most money to lobby.
I wonder if paying servers a commission on the food sales would improve things somewhat. At least it force employers to include that into the price of the items
>creates inequality
Did you mean that it rewards them for their efforts?
For food service, specifically waiting tables - how much of the tip is because of effort and better service - and how much is due to the attractiveness and general demographic characteristics of the server?
I personally top out at 20% no matter what. If the service is lousy I’ll go lower. When servers/bartenders are comping me then I know they get it and will up my percentage.
Good question. I would say mostly the former. I imagine you might say the latter.
I guess carrying around a large rack takes more effort than a small one.
What confuses me most is when you are given the option to give a tip before any service has been given. On deliveroo, for example, I have the option to tip the driver while I'm at the checkout. Why would I give a reward for good service when I have no idea if the service is even good? There's already a rider fee as part of my bill, so it doesn't make any sense to me to give them more money at that point
It is a mechanism to move labor costs to the consumer. On some delivery apps , the driver can decide which jobs to take based on the pre-service tip. So the companies have effectively put the responsibility to pay driver's base wage on the users themselves, while the company still takes a huge corporate cut
I suggested we do this at work. We’ll add a tip field to our Jira tickets and whoever’s ticket is worth the most gets priority. Oh you submitted a production incident a week ago? Sorry, there’s not even $5 on it, we filter those out.
We may just get this, along with a $7.25 per hour base wage!
It's $2.13 for tipped employees.
Not in all states. California does not have a lower tipped minimum wage. It's at least $16 here last I checked (except $20 for fast food because "reasons")
Ah yes; for a bit my wife was making less as a preschool teacher than the minimum wage at McDonalds. I understand it caused a bit of turnover at the local public schools, since cafeteria workers and aides were making less than $20/hr in 2024 as well (I don't know if they still are).
Reminds me of when I was visiting family a few years ago in Kentucky. I kept seeing tons of ads everywhere about hiring for plumbers, and some warehouse roles.
The listed salaries were not that far off from what even the local McDonald’s was paying
There was a (at least local) McDonald's inversion just after Covid; they were paying $20/hr which was competitive or better than the local factories.
It's one of those "reset" things you need to do now and then, because it's really easy for an industry like CNA or similar to end up paying less than the gas station for more annoying work.
So it does make great sense for a CNA or a preschool teacher to be quite a bit more highly paid than a gas station attendant or fry cook, due to the much higher responsibility level and like you said the annoyance.
However, I don't think anything that's happened in the last 5 years has helped that. If anything, the inflation has cost everyone dearly, but if I put 20% of my income into stocks I am less impacted than poor people who put 100% of their income into goods and services whose prices have gone up as a result of everyone's wages.
The 2.13 tipped wage is a great way to know if you're in a "shithole" state or not. Only shithole states keep that.
Same goes for the regular 7.25 federal minimum.
let’s not get too lofty, the federal base tipped wage is $2.13
gotta charge less than the hourly cost of a B200 to remain employed
Fun fact, we had this at an old job. It was a charge code field in Jira. It was required whenever you requested work from an external team. It operated like a credit card with a set budget. If you bothered other teams a lot, you ran out of money. Department heads set their price.
It sounds great in theory. But a black market quickly developed, and people figured out ways to circumvent it. People created tickets for their own teams and shared laptops.
On delivery apps it should be called a "bid" and I think honestly it would be more ethical than the shady nonsense they do now if they went all in on that.
If the apps were actually what they claim to be (a marketplace to connect hirers and workers) that's exactly what you'd have - the cost of the food + flat fee for the platform + your bid for the work. The platform could even suggest a bid, but you could choose to bid higher or lower depending on what you think would go through.
But that's not what they are; they're shady "avoid employment laws" companies.
I often see the claim that it would be above board/legit/not a circumvention of employment laws if they ran a bidding system like that. But ... that's exactly how Sidecar worked (Uber competitor, shut down Dec 2014), and I never saw anyone distinguish them from Uber in their criticisms (until people forgot that model existed).
i like the idea of bids, but only if its coupled with the ability of workers to just outright reject the offer.
the problem is that there's still a guarantee of service for the user regardless of what you bid. if i want my burritos delivered at 2AM and am only willing to bid $1 on delivery labor, i shouldn't expect that my burritos will be delivered.
for tips, the model is "the work will be done and i'll pay extra if it's good". but with bids its "how much do i need to pay to get this work started"
> It is a mechanism to move labor costs to the consumer.
How does this work? The corp already handles some form of payment to the worker, especially when you tip as part of a card payment. And in both cases, the consumer foots the bill.
How's it different from paying the worker more and asking for more money upfront?
The gready sleazeballs who like the "tipping" system (mostly, restaurant owners) would prefer to pay all their employees $0 and have all diners/customers/etc pay 100% of the wages out of guilt.
While 10% was customary in the first half of the 20th century, the standard tip gradually increased to 15% by the 1980s.
In 2025 it's not uncommon to see little shortcut buttons for 20, 25, 30%. You can see where this is going. They want us to tip 50% and they pay $0, even though restaurant menu prices are one of the things that has experienced more inflation than other things.
> would prefer to pay all their employees $0 and have all diners/customers/etc pay 100% of the wages out of guilt.
It is my understanding that this is literally the origin of tipping.
After the abolition of slavery, there were many black people newly looking for work. And, there were employers looking for workers, but unwilling to pay money to black people.
So, someone got the idea to promote that tipping was something fancy European aristocrats did. And, you can be fancy like they were by tipping my workers (that I refuse to pay).
Tipping was previously seen as un-Americanly classist. And, most states tried to ban it when it started to pick up steam. But, it was too late. So many employers were enjoying unpaid labor that the bans were repealed.
Later, when Minimum Wage was established, workers who lived on tips alone were almost all black. So, unsurprisingly, tipped workers were excluded from the wage regulation. And, today they are only acknowledged as fractional minimum laborers.
Perhaps shouting these problematic racist origins from the rooftops is our best shot at getting the support of the Left on board to at least establish that having business models based on obligatory tipping is unethical, if not to ban it.
It would backfire. They’re already losing the culture war. I don’t think the demographic you’re targeting will be very valuable on the scale of real political action.
The workers love the tipping system too, and it is directly in their interest to talk about how much it sucks, so that you are guilted into tipping more.
I spent 10 years in the food service industry working every position. The whole thing is racket, and the narrative used is carefully worded.
When I first had the money to pay for restaurant food ca. 1975, 15% was standard. I think that the Waiter Rant guy considered anything under 20% an insult, about 30 years after that.
Ah yes, the greedy sleazeballs. If you knew that the total cost of the meal would be the same, say $20 for the meal, does it to you matter if: 1) you pay $20 "no tip" and the owner pays non-tip minimum wage, or b) you pay $16.50 for the food and $3.50 separately to the server in the form of a tip ?
The problem is that the customer does not know the cost of the meal; they typically rely on the business owner to be upfront about that. Tipping is guilt-motivated drip pricing. The only thing the commenter got wrong is that the restaurateur has to prime the customer with some cost so they can voluntarily add a percentage.
https://en.wikipedia.org/wiki/Drip_pricing
> If you knew that the total cost of the meal would be the same,..
Huh, why should I know this at all. I read the prices online or in restaurant when I enter in. I will assume that as my cost of food.
> If you knew that the total cost of the meal
That's the crux of it. All surcharges are scams designed to trick the customer into thinking the meal is priced lower than it is. Sales tax not built into menu prices is a scam that the government is at fault for allowing. All other surcharges including the socially-obligatory tip and the scummy "health care surcharges" common in California, are scams that the restaurant is choosing to do. All of these are insulting.
It's no different than telling women I'm 6' and then when they meet me revealing that's only when I'm wearing cowboy boots and a big hat.
There is a very clear different from the consumer's point of view between paying a 20% delivery fee with no tip (and realistically having most drivers still expect an in-person tip) and a 5% delivery fee with a tip amount of your choosing (and maybe only 1/1000 drivers expecting/requesting yet more).
I have always been a generous tipper and I try to always put myself in that person's shoes when deciding how much to tip but even I notice the psychological difference. If you don't ever think about it, have never had a job waiting tables or dealing with the public, it'd almost be a nonstarter to have a higher delivery fee regardless of tip expectation.
psychologically they are very different. Framing the wages as a "tip" moves the conversation to the drivers and users, where users think tips are an out of hand culture problem and drivers view the users as stingy. Then the company sits out of the spotlight collecting their absurd rents
It moves the real cost of the additional labor from the prices displayed for items (like you would see in a B&M grocery store) to some tertiary part of the purchase process that is displayed 1) after the used has gone through the effort of app navigation and selecting their purchases and 2) has been through the majority of the purchase funnel and self-selected as a high-prospect sale. This helps keep the listed prices for items in these apps relatively comparable to their in-store listed prices, acting to convince the user the sale is reasonable (similar to online sellers making up for low listed prices with high shipping prices). Moving this additional cost to some tertiary step lessens the impact of goods pricing seeming too high by adding a "small optional fee" at the end of the purchase process that the user is expected to subconciously understand is effectively a bid on labor. I'd imagine the psychology behind it is depressing.
That is true. What is also true is that having things delivered to you is not free, and the prices of the goods cannot be same for delivery vs warehousing in a store.
Sure it can.
I'm not saying it's free but it's not a foregone conclusion that 100% (or any percent) of that cost must be passed on to the consumer.
If a manufacturer/distributor/restaurant is willing to accept lower margins for the increased reach and market access, they will.
It cannot be the case because the business would cease to exist in their current form if they did that. They would close their retail stores and become online only, because there is now zero incentive for anyone to go to the store instead of ordering it and having it delivered.
Different because now list price of a sandwich is $8.99 instead of $14 that customer will actually pay. Hotels, resorts, restaurants, tours etc are master at this. Even after knowing these add-ons people fall for it often enough to keep this practice running.
Besides economists think positively of this so it has support not just from interested parties but officials, think tanks etc.
> when you are given the option to give a tip before any service has been given [...] why would I give a reward for good service
Are there still customers giving tips as "a reward for good service"?
I'm trying to imagine a curve representing the distribution of "quality of service".
What shape is the curve, and where on it would a 20% tip and a 0% tip be?
>Are there still customers giving tips as "a reward for good service"?
As in any tip at all? No, from me. I don’t think I’ve never _not_ tipped when the situation expects it (sit down restaurant being served). I know the person there is being paid less than minimum wage (where I live), which is already too low in my opinion, so they get something.
The amount of the tip certainly is highly dependent on level of service. That could be a significant difference at the end. I’ve tipped over 100% when the staff has done someone that stood out to me.
(Having been a server in the past and now in tech, I feel guilty about the work-level/salary imbalance, so I am generally generous with my tips.)
> I know the person there is being paid less than minimum wage (where I live)
The restaurants I worked at (a variety of family places and bars) everyone was paid $2.13/hr or something like that. And after taxes, you would get a paycheck for $0.00.
but
The same people who jumped to tell you that they got paid less than minimum wage (especially when customers inquired about it), were making $40-80K year in reality. The service industry is all about hours worked, and which hours you work. A lot of young workers refuse to work the busy shifts (weekends), and hate dinner shifts (could be out with friends) so they only work the slow shifts and make ~$20/hr * 18 hours or something like that.
But the people there to make money? They work all the busy shifts and slow shifts to fill the gap (they work a full 40 hours), and the money is insane for what the work is. Meanwhile they will happily tell you they get paychecks for $0.00 and only made $50 on Monday at lunch.
In my country, which does have a tipping culture, the norm is to give a 10% tip in restaurants as a default, for competent service, decent food, etc. If the service is worse than normal (rude server, cold food, huge wait times, mistaken orders etc) you'd live a lower tip, possibly none at all. If the service is great, you might leave a higher tip - though 20% would be considered huge, 12-15% might be quite normal for very good service.
> Are there still customers giving tips as "a reward for good service"?
Sad if this is no longer the case.
In the UK at least (and the rest of Europe too, as far as I can tell), this is still very much the case. The curve varies with the individuals tipping. I would be quite happy to give 20% if the service was outstanding. I’m equally happy to not tip at all if the service was very poor.
France here - no tip is the norm, tip is for service above & beyond... But, contrary to the USA, everyone gets a proper living wage !
Depends on when you are. Making minimum wage while living in Paris isn't exactly a "proper living wage".
Still it's not the scam that passes for wage in the US (especially considering cost of living and other expenses). And Paris can be anything, from expensive neighborhoods to project suburbs.
That isn't the customers problem though nor should it be.
The only issue with restaurants in France is that they close up early, or only open within strict lunch hours.
If you're paying a relatively high hourly wage to all of the staff, it seems unsurprising that you'd not want to be open during times of low customer traffic.
Honestly, this seems good overall; there's no more sense in having low-paid waitstaff hanging around hoping to get a customer table that will tip than in having a restaurant owner keep the restaurant open while paying the staff a reasonable hourly wage.
In France, I always thought it was customary to leave the change from l'addition. (I'm not French though, so perhaps I was commiting a faux pas)
I can confirm in Italy almost no one will even accept a tip. (Taxi drivers, wait-staff, hotel staff)
> leave the change from l'addition
Yes, that is the basic tip if you expect to come back to that restaurant and get an upgraded welcome.
But even with no tip, being a regular counts - tip or no tip, you are good business and worth cultivating.
> In the UK at least this is still very much the case.
Except for the very pervasive 12.5% "discretionary" service charge the you would have to request to be removed. Which is a genius piece of social engineering.
I live in the UK, and I personally have never given a tip, I don't think I've even seen it as an option other than physically giving the other person some cash, but AFAIK its generally seen as something you do if the service was excellent, but as I say I've never done it myself. I'm not generally in situations where it could be warranted, like I don't really eat out much or anything like that
As someone who also lives in the UK this surprises me. Almost every restaurant I eat at now takes the liberty of adding a 10% service charge onto every bill. I assume the idea of which is to make it awkward/embarrassing for you to request to have it taken off.
I may have had this happen without realising, but in my head, a tip is something you choose to add on extra, whether for good service or because the workers aren't getting paid properly. If I get a service charge, that's more like just part of the bill that I would pay, though I've only really noticed it as part of online stuff, for example my bank has a £25 service change to send money overseas (for some reason, I can't imagine that the process isn't fully automatic by now)
> for example my bank has a £25 service change to send money overseas
OT but the kind of bank that charges £25 for something like that is almost certainly robbing you blind on the exchange rate, too.
You've never had excellent service for something?
Yes, in countries outside the US I don't tip unless I got especially good service. Servers get paid (at least) minimum wage here and if they want more they should take it up with their employer like the rest of us.
In the US I usually tip but have refused to do so when the service was especially bad - although even then its a hard decision because you often don't know who is actually responsible for the bad service.
In my country the norm is for tips to be rounding based rather than percentage. So if your bill is 327.5, you would pay 350, effectively a "keep the change" sort of gesture.
I have certainly starred them in the eye and waited for them to ostentatiously count out every last penny when the service was truly abominable. It's a fairly effective way to give feedback.
You can also of course round up higher, so in the previous example for exceeding expectations you could round up to 400.
In 30+ years I’ve given exactly two restaurant servers 0% tip - it takes a lot for me to give someone nothing, but somehow they met the challenge.
In some scenarios, 1% tip can be informative to humans and data mining algorithms.
>Are there still customers giving tips as "a reward for good service"?
That's the only way people give tips here (not US tho)
Hehe, in here (US) tip for a bad hair cut in 15 dollars is 5 dollars. For better haircut maybe go for fancy salon if one is so particular about hairs.
> Are there still customers giving tips as "a reward for good service"?
Are there customers giving tips for other reasons? Any examples?
In the US, the tip is an expected part of the expense of eating out (and increasingly having any human in the loop). I hate it, and I really wish it wasn’t the case, but it pretty much is. If you say “I didn’t tip because the service was what I expected”, you’re pretty much considered an asshole.
(Incidentally, this is also one of the reasons why the costs of eating out in the US and seem so much lower. Most people who come from non-tipping cultures don’t understand that Americans actually tend to pay significantly more than sticker price, especially after you include taxes, which are also often excluded).
Relative numbers (e.g. 1% above or below an average) can ferry signals to both humans and data mining algorithms.
https://plus.maths.org/content/information-surprise
> Shannon wanted to measure the amount of information you could transmit via various media. There are many ways of sending messages: you could produce smoke signals, use Morse code, the telephone, or (in today's world) send an email. To treat them all on equal terms, Shannon decided to forget about exactly how each of these methods transmits a message and simply thought of them as ways of producing strings of symbols. How do you measure the information contained in such a string?
>If you say “I didn’t tip because the service was what I expected”, you’re pretty much considered an asshole
Sorry, this is definitely not the case. Many times the worker is doing exactly what is needed and nothing more (eg: pour a beer in a glass, handing me a pizza). Why would I be considered an asshole if I didn't tip? That is ridiculous.
As other people have said, tipping in the US has really become obnoxious. I definitely tip while seated for a meal, but asking for a tip to hand me a cup of coffee, pour a beer, etc only makes the system worse.
Why does sitting down cause you to tip?
Why would employees in front of a counter be more deserving than employees behind a counter?
Or perhaps I should put it like: Why would a business need to pay a predictable market rate salary for employees behind the counter, but not for employees in front of the counter (because you step in and provide it instead)?
Because the person serving a beer at a bar simply poured me a beer. I walked up to the bar where I ordered from the menu. The level of interaction with staff = 1. Effort from staff = 1.
The the waiter/waitress had to come to my table, discuss the menu, provide feedback on questions, submitted order to kitchen, delivered order, checked back on us to see if we need anything else, etc. Level of interaction with staff > 1, level of effort from staff > 1. Tip appropriately if level of effort > 1 for helpfulness, politeness, attentiveness, etc. Stop making this so hard.
So how many hours is the walking waiter working in a day, and how many hours is the standing waiter working?
If anything it seems to me that it would be more logical to tip the person doing the more boring and repetitive work.
(My personal opinion is that tipping in general is a blight on a modern society and something that belong in primitive third-world economies. The way to fix this is via legislation: we simply make all forms of both receiving and giving tips illegal. It probably won't take much enforcement to quickly shift the social norms and economic practices once the wheels get rolling).
I 100% agree with your value judgement. Nevertheless, the social pressure exists.
The OP above you is guaranteed to have had their food spat in or otherwise tortured as punishment for not tipping.
Tipping isn't just a social thing, there are real physical punishments for not doing it!
Non-technical solution: move to a location with high social trust, e.g. neighbors and workers know and support each other socially and economically.
I feel like you’re making their point. If the “punishment“ for paying sticker price is you getting actually hurt, then it’s not a tip, it’s extortion. A social custom that the customary price of something is 30% more expensive than what the sticker says is unfortunate. A social custom of extortion is abominable.
>The OP above you is guaranteed to have had their food spat in or otherwise tortured as punishment for not tipping.
Wait, what??? Do you honestly believe the worker pours a cup of coffee in a to-go cup, hands it to me, checks the receipt for a tip, then grabs it back to spit in it? What kind of delusional thinking is this? How does the food delivery person even know the tip amount before the receipt? This kind of thinking is exactly why the system is so out of hand.
In my personal experience, the belief that “you should tip no matter what” is surprisingly pervasive. Anecdotally, I once had a situation where a restaurant completely dropped the ball—they brought me a cup of coffee, then never returned to take my order, even after I asked. After wasting my time, I had to leave and eat elsewhere. I didn’t leave a tip, yet many of my peers insisted I still should have. I disagree. The idea of tipping someone for poor service—especially when they’re clearly not even trying—is, frankly, sickening. If that makes me the a-hole in these situations, so be it—I’d rather be that than reward apathy.
If you’re asked for a 20/25/30% tip before they even start preparing your food, and you need to make extra clicks while the tip recipient is looking at you if you want to tip lower, theres a small fear that the food you ordered wont be prepared as well as someone who left the tip
On a gig delivery app, you give a tip so that someone will be happy to deliver it and not mess up your food, I think. a 0% tip is risking stuff. You can't really say it's a reward for the service though, more of a payment to secure better service?
Lots of places will now ask for tips before the food comes out even in person now - lunch sandwich shops, etc. I don't think they'd be unprofessional enough to mess up your order if you didn't tip, but maybe they'll be happier with you or be more generous if you tip now too.
On some delivery apps, tips can be increased after service delivery, e.g. baseline at time of order, bonus after good service.
> 0% tip is risking stuff
There are more numbers between zero and good! Markets depend on information. Price has been information for centuries.
The insurance industry has actuarial lessons for managing risk. The delivery app industry has a range of policy measures for managing delivery performance, including but not limited to refunds and blacklisting workers from serving specific clients.
I don't think they know you tipped until the delivery is complete, to avoid that precisely.
That's traditionally what's called a protection racket rather than a tip.
At least where I am from tipping is more done to round out the bill to a nice number.
Well I am giving tip because of fucking nag screen on payment terminal.
Can the screen be ignored, e.g. when tipping with cash?
Are there still customers giving tips as "a reward for good service"?
Yes.
It might be a way for them to prioritize your order before others as they see how much money they earn, so actually it's a bidding process disguised as tipping. I'm not sure if it's shown in the backend though, but I have seen things like this in other delivery apps.
Why would they prioritize you when you've already paid? Wouldn't they first go after the possibility of more tip money on jobs that haven't yet paid it? I mean, if I was a driver, unless there are more high tip jobs than I could handle, I'd take those and fill in with low tip jobs, and I'd deliver the low tip jobs first in a hope of getting an after the fact tip.
Delivery drivers on some apps are told the expected pay for a trip. If you don't tip, they might decline the job because it costs them more to deliver then they make.
This makes your order sit longer until someone decides to do it, perhaps because there's a penalty from the company for declining jobs, and the driver is willing to lose money to remain in good standing
So it’s hiding behind social pressure to externalise costs? Which I guess is tipping in general.
Ooh that’s actually a really interesting question. Because you’ve retroactively signaled that you will pay more for priority service? Or that you’re dumb. Needs to be iterated. Incentives depend strongly on population of both drivers and customers.
A lot of times, that makes the order come slower. A higher tip means the app will pair your order with someone else that didn't tip or tipped smaller, using your money to make up the difference. I consistently get faster deliveries when I tip towards "the average" instead of over tipping
Why would you keep using an app that you suspect was cynically exploiting your generosity like that? I’d drive every time rather than encourage such behaviour.
>Why would you keep using an app that you suspect was cynically exploiting your generosity like that? I’d drive every time rather than encourage such behaviour.
Surely you already know that choosing things doesn't always simplify down to a single dimension. Instead, there are multiple factors that lead people to deliberately choose options that have negatives.
E.g. Why do people continue to use Ryanair airlines if they always nickel & dime customers and treat them like shit?!? Because the mistreatment by Ryanair is still better than driving for 6 hours or paying more $$$ for Air France or KLM.
Likewise, why do customers continue playing along with the tips/bribery/ransom game in the delivery app?!? Because the user-hostile app is still better than rounding up the small toddlers and infant into the car, fasten the car seat, and drive to the restaurant.
Life doesn't always provide unambiguous good options. Instead, you choose the "least bad" from the list of bad options.
In a Louis Rossmann video (i think it was the one on food delivery guys on e-bikes) he mentions never tipping in app but leaving a note that says he will give a cash tip if the driver brings the food straight to his door. That seems like a decent compromise as it doesn't let the app take a cut from the tip and makes so the driver actually goes the extra mile to 'deserve' the tip.
Weirdly on Reddit I keep getting the doordash and ubereats communities pushed at me - there is a very strong view amongst people using these apps that anyone who says they will "give a cash tip" will not actually do it, so it's probably not as beneficial as you might think.
The tips on the apps nominally do go entirely to the driver.
>* but leaving a note that says he will give a cash tip if the driver brings the food straight to his door.*
Why, where else would they take the food? Leave in at the patio? Drop it on the lawn?
About half the time I order UberEats I get a call from the driver that they're here and to come downstairs because they won't enter my apartment building. Could be laziness, it could also be because the street parking is always full and so the only place to park close by is a fire hydrant.
The app has different options for meeting in the lobby / come to my unit and I always select my unit, but whatever, I get why they might not do that.
Leaving it on the porch, on the street closest to their car, with the front lobby in an apartment building...
There's quite a lot of places people will think to leave food if they're rushing to pick up another job.
Some people live in multi-tenant buildings where "your door" is not the buildings entrance.
Thank you for this tip on analog defense against digital dark patterns!
You’re not paying for a service, you’re bidding in an open market. They don’t tell you this but it’s the reality.
Drivers can tell if you don’t tip and all of the experienced ones will decline your order.
Though these apps have done a lot of work to conceal the amount the driver actually gets until delivery is completed.
Hm. If it is an open market, the consumer should also be able to decline/filter drivers, that take tips. Maybe it is a market, but sadly not open.
You can already filter out drivers that don't take tips (so, filter to zero) by just not placing the order.
But that filter is at best inaccurate then isnt it? Surely there exists a driver which would accept a tipless delivery, but you cannot find them because all you can do is decline to do business.
Americans need to remove the idea of tipping. It's archaic, because it was originally there for an aristocratic/wealthy patron to show off their status to the lowly servants of an establishment.
Just charge a price, and have it include the full service fee required for providing the service.
If you enter zero tip then you will find drivers who accept that because the rest won't accept.
> You’re not paying for a service, you’re bidding in an open market.
IMHO, this isn't a new phenomenon. Close to 18 years ago, I lived in a city with a popular pizza spot that was about a 10 minute walk away. Normally I'd walk, but having a newborn make that challenging, so I'd get delivery.
Typically, the delivery would take 60+ minutes on a busy night, but after a few consecutive Fridays of a decent tip for the order, the pizza would arrive "burn your fingers" in about 20 minutes.
> bidding in an open market.. they don't tell you... apps done a lot of work to conceal
Markets have prices.
Open markets have transparent pricing for efficient discovery.
Concealed prices in deniable auctions are closer to dark pools than open markets.
Surely most customers would benefit from knowing that they’re bidding for service? Don’t call it a tip, but a bid or priority fee.
You already are able to pay more for 5-20 minutes of "priority".
All that this does is ensure you don't get stacked with another order ahead of you (so the delivery is direct from the restaurant to the person who ordered) in theory.
It doesn't help with situations where drivers are multi-apping (accepting orders across multiple apps and juggling them). The drivers don't even know you have priority.
edit: and in the US where you can definitely see the tip up front, you will almost always find that the order will get picked up quicker if you increase the tip by the equivalent of the priority fee. But you may well get stuck with a delivery before yours.
In my experience, choosing the priority option is nearly a guarantee that I will get a driver who makes extra stops while delivering my order.
It's wild because this happens maybe 10-15% of the time for me when I don't choose priority, but it's around 80% when I do.
I ignore the option now and just bump the tip if I want a chance of better service.
this feels weird to me because i always thought i already paid for the service as part of my order. having to go into a open, blind bidding war with other customers to gett my order processed ...
With Wolt the rider can’t see tips until after delivery.
... Which they can still use against you
Doesn’t affect anything in my country using the same apps. I’ve always gotten fast delivery, as does everyone I know and nobody tips. Tipping is for yanks.
That's bad, but even worse is the Bluetti website, which asks you for a service tip FOR AN ONLINE ORDER!
I started using Fiverr for outsourcing some tasks and they push you to tip after the transaction.
That's not a tip, it's a bid. Expect a lot more businesses to start operating like this if no tax on tips goes into effect.
Tipping is more like a form of price discrimination. It allows restaurants to indirectly charge different customers different amounts based on ability to pay.
Tip before service is a bribe in my book.
(Uber started to pop up tip options before the ride ends, sometimes as soon as the ride starts.)
They’re just saying the quiet part out loud, the tip isn’t for service, it’s for their basic wage.
Is almost like a bribe I guess?
It's mostly a convenience, so that you don't have to look for coins or remember to tip online later. Uber here even tells you that the driver doesn't get informed about the tip until an hour after delivery, so you can still edit it in case you change your mind.
we can regulate the intermediary
we can literally get the state to say it is illegal for the point of sale system to have that or sell that to merchants
we can tie it to business codes that dictate which type of business it is to payment processors
control behavior by regulating the intermediary
the beauty of this philosophy is that it works under any system of government: don’t worry about the rights afforded to merchants or individuals, don’t burden them with the law at all, only intermediaries!
poof, tips at the point of sale system before receiving service disappears as fast as it came, short Square (now Block)
we can go deeper too
A delivery app tip is a way to influence drivers to pick your order, they can see what the expected value of a delivery is and if your tip is too low, your order will take a while.
Consider it a premium that prioritizes your order, that’s what it actually is.
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It’s crazy that this still happens in the US.
Tipping is a thing of the past. Pay for your meal and have the restaurant pay their people for their work. End of story.
The crazier part is that it's spreading to more industries and more countries thanks to Americans thinking they should tip everyone everywhere. Thanks.
My take is that it is spreading not due to culture, but due to how all new point of sale systems / card terminals come with a "tip" feature implemented.
I'm from Europe, and have traveled here extensively. Tipping is pretty rare, but for the past maybe 5 years, almost all new payment terminals have the tipping option.
If the EU can force every person on earth to dismiss a cookie popup on every website they visit, surely they can pass some regulation to rein in the expansion of tipping.
For example, just make it a requirement that the default tip is 0% in point of sale systems.
This is absolutely true, but that is exactly how culture spreads now. Through products/software/media.
American business software, American movies, American YouTube channels. They will inject American problems and solutions into your country, like it or not.
Microsoft may treat your privacy slightly better because of the GDPR, but those invasive systems are still there, toggled off. Waiting for Microsofts lobbying to chip away at the privacy laws until they can turn them on.
Microsoft doesn't need to chip at the privacy laws of the EU, the EU is doing that itself by introducing massive state surveillance laws every 6 months.
No, it's spreading because corporations are waking up to what an insanely good deal "pay my employees for me" is.
In my state an employer is only responsible for raising an employee's effective wage (for the entire pay period) to minimum wage if the tips don't.
You can tip someone working as a waiter $100 and unless they've already hit minimum wage for that pay period, all you're doing is handing $100 to the owner because it's $100 they don't have to pay in wages. Once the waiter has met minimum wage, then the money actually goes to them.
In a sense this policy has kind of saved me money, because I have simply been avoiding restaurants that expect me to tip and cook at home more often.
I hate pretty much everything about tipping. The onus shouldn’t be on some fucking customer to determine if a server makes rent this month.
I really hate that pretty much every payment terminal asks for a tip now.
Same here. We have really cut down on the amount of "out for lunch/dinner" activities we plan. One reason is the tip situation; the other is because we can cook as well at home than out of the house. In the past (80s), going out to dinner was considered a real treat. In the 2000s, it was commonplace. Now, I think we are back to the 80s mentality (cost, tipping, food quality, etc)
In California we've set the tipped minimum wage to the same as the non-tipped minimum wage (so employers have to pay their employees the same regular minimum wage regardless of whether or not it's a tipped job). Unfortunately, that hasn't fixed the tipping problem.
Of course, a living wage in California is quite a bit higher then even our above-average minimum wage, so that's a big part of it.
I'd argue that (our socially-obligatory form of) tipping is a deceptive pricing practice (not really any better than a store labeling shelves with a giant $4 and a .99 written so small you need a magnifying glass to perceive it). As such, if banning it is too impractical, they should disincentivize it with the tax system. I can't figure out the best way, but it's disappointing that our government is obviously not trying to.
Note: I don't care one bit if someone wants to recognize an exceptional act by handing $20 to a worker -- that's great. That's not the same as giving a bartender $4 for spending 12 seconds pouring vodka and redbull into a glass or tipping $3 when I stood in line to order at a counter and came to fetch my food when my number is called.
> deceptive pricing practice
It even has a name.
https://en.wikipedia.org/wiki/Drip_pricing
I think a ban on the solicitation of tips, including tip jars, would be practical and easy to implement. It would still be legal to tip if not asked/prompted. That would make the tip prompts on payment terminals illegal, as well as tip jars.
I don’t think tipping would continue without a way to demand tips or shame people with prompts.
my wife worked under this regime of we-pay-below-minimum and you make it up with tips, when she was a student. it’s illegal in multiple states. including the state where it was done to her. but if you need that sort of job you’re typically probably not in a position to go after your employer…
I'm guessing this barely applies in practice, since only 1% of hourly employees make minimum wage. A tipped employee who doesn't reach minimum wage is probably getting fired regardless.
And yet tipped servers often earn more that the cooks who make the food.
Because they know they can get away with it.
It is also not "tip" anymore, it is just "whatever pays the most" gets the service. It is just to maximise profit out of suckers, something US have perfected (from insurance to fast passes).
Living in Ireland from 2013-2023 I saw tipping get _much_ more common, sadly.
I don't mind tipping for exceptional service, I do however have a major issue with the obligation of tipping. It really should not be on the customers to pay the employees salaries directly.
I don't think we should be tipping at all, even for exceptional service. The job is the job, and the employer should be paying the full amount that job is worth. If the employee is doing it exceptionally well, going above and beyond, the employer should reward them with a raise, same as for salaried positions.
That's assuming the employer values that above-and-beyond-ness, of course. If not, they won't give that raise, and employees will eventually settle on a level of service that the employer is paying for. If that's good enough for the customers, that's fine. If not, that's an opportunity for a competitor to pay employees more so they'll serve customers better.
Customers should not be put in the awkward position of feeling like they should be augmenting people's wages, even if it's on top of an already-sufficient living wage. Wages paid is a negotiation between employer and employee. Customers should not be involved, beyond paying the listed or contracted/agreed-upon price.
I live in a country with near zero tipping culture.
For the most part I find the food gets to my table at some point but I'm rarely particularly happy with customer service. It's sometimes an awkward negotiation to get their attention or to ask something. The opposite was true in my time living in the US - soft skills, fast response, engagement are standard. And I've been on both sides of that in food service.
Now, the logic of what youre talking about makes perfect sense and I agree with that in principle. And yet there is something about dining that is somehow different. Escapes that definition.
There are also times I find that exchanging money is more honest. I want you to serve me, I'm paying you, I don't have to keep at the back of my mind a question whether I'm asking something beyond what your boss expects/pays you. I like that about the US - it's brutal but that's reality.
Don't get me wrong, I live in EU for a reason, but some things here are made unnecessarily complicated and oblique too.
I haven't spent almost any time in Europe, but in the US at some point it seems to have gone from a setup to incentivize that "soft skills, fast response, engagement" to one that I don't feel does that much due to the social obligation. When your worst case scenario is 18% and your best case is likely 20% + rounded up, who bothers to change their behavior? In my experience it's more like a commission than a tip, and that's because the only real impact is it encourages the waiters to remember to promote expensive alcoholic drinks before and during the meal, since you can earn way more money getting 18% from a table who orders 2 drinks than you do by earning 21% from a table drinking water. As a commission, it should be paid by the employer.
I call tipping the "A*hole discount" because only someone who is comfortable being seen as one would consider tipping 0% or even 10%. And servers will tell you that if you receive terrible, horrible, very bad service you should never tip zero, you should speak to the manager instead (since yadda yadda, the tips are for everyone, you don't know whose fault it is, etc). So instead of tips being a way to reward good service, it's actually just a discount reserved for people who are so uncouth that (A) they don't care if everyone at their table thinks they're an ass, and (B) they don't mind taking food off the table of low-wage workers (very low in states that have the horrible policy of a lower "tipped" min wage). Do those people really deserve a discount?
> There are also times I find that exchanging money is more honest. I want you to serve me, I'm paying you, I don't have to keep at the back of my mind a question whether I'm asking something beyond what your boss expects/pays you. I like that about the US - it's brutal but that's reality.
But isn't this describing tipping? You're having to ask yourself, "Is this service good enough for a tip? How much of a tip?" instead of just exchanging money for the service and that's it.
It is and that's why my point is that there is nuance here.
I had more fun and more satisfaction working in food service in the US than in the EU. There was also more real opportunity right there on the spot to do the thing and get more.
Like yeah, you're having to ask yourself and that's friction. But shouldn't there be a friction when you're being served by someone who is an equal? I've seen folks treat service like garbage in the EU because that exchange obscures the fact that there is an exchange of money. And I've seen service fall back on apathy.
But this is just one way to look at it - ideally it should be exactly as you describe - good service, simple exchange at specified price and confidence that the service is adequately paid for the job.
Only issue is that even in the EU this is often not the truth and restaurants would never ever afford to actually hire full-time employment contracts.
> Like yeah, you're having to ask yourself and that's friction. But shouldn't there be a friction when you're being served by someone who is an equal? I've seen folks treat service like garbage in the EU because that exchange obscures the fact that there is an exchange of money. And I've seen service fall back on apathy.
Interestingly, I arrive at an entirely separate conclusion - there is no way for equality in a relationship in which one party holds your financial security (for lack of better words) in their hands. How can the waiter be your equal in that situation, when they might have to act just to ensure they can make the money they need?
Yes, I have also been thinking how a similar reward system would work without tipping. Just use a bonus system based on customer feedback. And the flow could be very similar to how it is with tipping.
It's not worse than tipping, but we've already normalized the obnoxious idea that every transaction needs to earn five stars. You know the places. The ones where they warn you "You're going to get a survey, if there is any reason why you don't feel like you can give us a 5 please tell me" (unsaid: Please sir -- they flog us for 4 star ratings). I can't imagine anyone I know not rating an Uber 5 stars, unless they were say, called a slur or the driver caused an accident.
So, I'm not sure how to best construct a system not open to "guilt gaming" in this way, but I would like to see one.
I do, it creates perverse incentives and dehumanizes people.
Imagine yourself catering someone and then having them talk about how great that is and wanting to pay you for that. Not in abstract but actually, in practice. It nails down the servant role, frankly. It feels abhorrent to me, even if you get numb to it over time.
From my perspective, tipping is a socially acceptable way to establish classes. Which itself is a terrible practice and the people catering you aren't your servants.
I used "catering" in this comment as a placeholder for any job that receives tips.
It really depends on the amount. In Belgium for instance there would be no tipping, but rounding up or adding one or two spare coins of change you still have on you in case the service was excellent.
It is like any job where people get a bonus because they have gone above and beyond.
Why can't the employer give that bonus? In non-service jobs employees don't get tips for going above and beyond; they get raises or bonuses.
Is this changing as cash gets less common?
Giving extra money is literally tipping?
What's worse, it adds "emotional labor" (if I may borrow that term) to a staffer's job; while it's expected for staff to be representative of their company, it really feels like staff in tipping establishments have to put on a show and fake persona to optimize the tipping. But likewise, if you don't tip or don't do enough you (as a customer) are treated like shit.
I'm too autistic to be playing these games and figuring this shit out. I'm glad I don't live in the US.
> It really should not be on random strangers to determine the employees salaries directly
FTFY
(I mean, actually I agree with your point too; but personally I think tipping is much more unfair to the employees than to the customers.)
[flagged]
I spent half my adult life in Ireland, had kids there, built a house there, etc and like to think that during said time I learned a few things and noticed changes. I do think part of it related to POS systems normalizing it. But it is certainly possible that our experiences differed. It was more common in Dublin 2 than in Offaly I'd say...
Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up. And I spent much more of my time extolling Ireland's virtues than complaining about it! It was surreal to be chatting with taxi drivers and trying to make the point that Ireland wasn't an utter kip.
Very off-topic: but the RSS icon on your website still(?) points to feedly and doesn't give your latest blogpost but some feedly crap.
Thanks, I should take it down, really…
> Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up.
In Spain we tend to have a similar attitude. Not really telling people to shut up, but if foreigners criticize our country we tend to get defensive, even if they are saying things we would agree with or say in a conversation between locals.
For me it's like common sense, just like you don't acknowledge family problems when you talk to people outside close family and friends, but it's probably just the culture I've been raised in.
Yeah, but when immigrants to my home country complained we generally agreed. I mean, why wouldn’t people experiencing the same system have similar complaints?
Oh, OK. I was thinking about foreigners that are here just for a visit. Immigrants get treated like one of us in this respect. In fact immigrants soon experience the horrors of our bureaucracy when they need to obtain their papers, and this typically creates opportunities to bond with the locals by venting about it :)
> Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up
Haha nail on head here. On behalf of my fellow Irish people - sorry!
America has spent the last century proclaiming itself the greatest country on earth, whilst simultaneously causing untold political and social problems in "lesser countries" to its own benefit.
Some deep rooted resentment when an American criticises a place is natural.
Fair! I left America in part due to disgust with the place so I likely share many sentiments.
> Honestly something that was a bit galling was that the Irish would moan about Ireland morning day and night but the instant a foreigner made _any_ observation that wasn't rainbows and sunshine we were out of our lane and needed to shut up.
Not to be rude, but have you considered this may have been an issue with you and your attitude, rather than everyone you met, if even people who you seemed to think liked you couldn't stand you.
No, not really. My experience there was generally positive and I met lots of great people. That being said it’s fair to observe that different cultures have different traits. I have a friend here in the Netherlands from Roscommon and he gives out about Ireland -much- more than me, and when I mentioned we’d lived in Offaly he described it as “the beating heart of Irish begrudgery”, which checks out.
Anyway this conversation is a net negative to my day and I’m bowing out.
"Not to be rude" my hole. What @CalRobert said is 100% accurate - only we are allowed to criticise Ireland, and criticism is especially unwelcome from Brits and Yanks
I disagree. Irish are _much more_ receptive to criticism of the country from immigrants than most countries.
In my experience, the United States and England (not the entire UK) have the thinnest skin and some people will straight-up tell you to f-off home on the slightest criticism, especially on the subject of human rights or the expeditionary wars.
There are of course the usual suspects, the racists and "Pro-Irish" crowd, who will blame everything on immigrants and accept no criticism of their imagined Ireland, but this isn't true in general.
However, if you make grand pronouncements from a position of profound ignorance and overtly judge the life choices of your new compatriots - a speciality of the GP - you will find yourself alienated at best. This is true everywhere, not just Ireland.
> I disagree. Irish are _much more_ receptive to criticism of the country from immigrants than most countries.
Unless, of course, the criticism is someone making a personal observation about how they saw tipping culture expand during their time in Ireland, right? Then the appropriate response is to generalize that Americans love making ignorant comments about other cultures.
> Unless, of course, the criticism is someone making a personal observation about how they saw tipping culture expand during their time in Ireland, right? Then the appropriate response is to generalize that Americans love making ignorant comments about other cultures.
Unless they're factually incorrect, which is the case here.
The original poster's subjective, personal experience with tipping culture in Ireland is "factually incorrect"?
Perhaps they just had a different experience than you.
Yes, it's factually incorrect. As in, it's both not true and they didn't experience it.
Well, they say they did experience it. You cannot possibly know otherwise.
There’s also another commenter in this thread who says they’ve lived in Ireland for their entire life and says they’ve experienced the same thing.
Then, there’s you.
There are two likely explanations I can think of for your behavior here. 1, you are arguing in bad faith. 2, you are unable, for whatever reason, to understand that others might have a different experience in the world than you.
In either case, I don’t see any point in continuing this conversation. Have a nice day.
Nah, born and lived here my whole life and requests for tips are way up, from just eat to payment terminals asking for 10% for things that maybe would have been untipped in the past.
This is why power/hegemony are good. This is what Euros get for their lazy, easy lives of "work to live" and siestas. You don't get to have your own culture anymore. Start working hard or continue to fade into obscurity.
Yep. It's wonderful throwing a few extra bucks to some euro waiter and watching them treat you better than everyone else.
> "treat you better than everyone else."
People say this, but what is better service?
It's not like you get better or more food, or get the food faster since all that depends on the kitchen that isn't getting tipped directly.
It's pretty much them coming to your table to take your order. I'd much rather have a free burger or drink (the equivalent of what I could get instead of tipping) with the slow service than get my water refilled every 5 minutes.
> It's not like you get better or more food, or get the food faster since all that depends on the kitchen
Oh, trust me, go to a decent place, be a regular, tip decently (not even extravagantly), you absolutely get looked after. For instance, several of my usual lunch spots my usual fountain drink is often "water" on the bill.
Isn't that then stealing from the owner?
I just don't think of a way you can have tipping and it not create perverse incentives like that.
It's likely not like this everywhere but I've become a regular at a few places over my life time and asked about this. At least where I've been, it is actually all tracked. Generally, at least at bars, the people coming in and tipping well, are people who come in often and spend a lot to begin with so over the long run they end up making it back anyway. And honestly, when you're new to a city/place and don't have a lot of friends/are single, and you walk in somewhere and are greeted by name and served your usual without asking it's a nice retreat.
> so over the long run they end up making it back anyway
Yeah, they lose on the unit, but they make it back on the volume!
How are you both new to a city/place and they already know your name/usual before you've even tipped? Do they send runners out ahead with the information?
I've had similar experiences in all-inclusive resorts in Mexico and the Carribean where they stock your fridge. Leave a few bucks in the door of the fridge, it'll be overflowing. If you don't tip, you get the minimum. Tip the bell man well at the beginning of the trip, and every time you call the front desk things show up at your room real quick.
It means the pretty girl flirts with him. Otherwise why would she?
When they treat you better? In the last 2 minutes after you payed just before you leave?
> In the last 2 minutes after you payed just before you leave?
Definitely the next time I come back.
Restaurant workers should earn a good wage. Tipping should not be mandatory. But tips, in particular large tips, are fine and work globally.
You know what works even better? Being a friendly and nice person. It has the added bonus that when they greet you and "treat you better" (whatever you mean by that) next time you’ll know it’s not just because of your wallet.
> You know what works even better? Being a friendly and nice person.
Not mutually exclusive :)
> You know what works even better? Being a friendly and nice person
I do both. And I don’t always leave a large tip. If I’m having a good quarter or year, I’ll share it. If I’m not, I can’t.
At the end of the day, they’re running a business and I’m a customer. If we’re friends I’ll buy them dinner (and they’ll comp random stuff).
> and they’ll comp random stuff
You should send a thank you note to the owner!
What do you think about the tip-free section in: https://www.mollymoon.com/icecreamforeveryone
Quick summary:
- Tipping results in lower pay for certain genders and races.
- laws that protect employees don't apply to customers. Your boss can't make inappropriate comments and pay you less if you complain. But if a customer makes inappropriate comments, its perfectly legal for the customer to pay you less if you reject their advances.
I don’t think any of this is fixed by banning tips.
As I said, tipping shouldn’t be mandatory nor required for someone to make a living serving, frankly, relatively wealthy people and experience.
If someone owns a restaurant, I can show gratitude by coming more. If my clients like me, they can show gratitude by giving me more business. If a server does a great job independent of their employer, a tip is a good way of showing that.
(That said, if a group of employees has agreed to no tips, they should refuse them and one shouldn’t push.)
Why?
In my experience they are often confused and sometimes insulted. Generally I found tipping to add friction to the transaction.
When I visited the US I’ve noticed some waiters would treat you worse or just ignore if they found out you were a tourist, so when I could I would order something small and pay right away with tip, just to get basic service. So your comment makes 0 sense.
That feels disturbingly like a lite version of paying someone to be your friend. Maybe we should just all treat each other well (in both directions) and not reduce manners and social graces to a financial transaction.
I'm curious whether you have ever worked in the service industry?
I have, in the UK. Probably 95% of customers didn't tip. I didn't have any problems with this.
Why?
I was nice to people because that was my job, but when I've travelled to the US I have definitely seen entitled customers treat staff like shit and claiming it's their right because they were tipping.
Tipping as standard should go out the window, it just drives customers to be assholes.
I worked in a fast food restaurant here in the States, people tipped but usually not well. I wasn't pressed about it, I was getting a full minimum wage. Entitled customers didn't give me trouble for whatever reason, they seemed to size up my coworkers as softer targets.
> Why?
I was just curious about how OP's experience informed their perspective.
When visiting the States I have observed on a couple of occasions where a customer shouted at staff and used the threat of withholding a tip as leverage to be unreasonably nasty to wait staff.
The service industry in the US is awful, and the tipping culture is really toxic. I don't understand those that defend the American approach.
To be clear, I don't defend it. I'm mildly against it. Unfortunately I don't in it's at the root of entitled customer behavior in the States, I think there's a deeper cultural contempt for service workers. You'll see similar behavior towards workers who aren't tipped but who provide some sort of face-to-face service, like cashiers and teachers.
> Unfortunately I don't in it's at the root of entitled customer behavior in the States, I think there's a deeper cultural contempt for service workers.
Completely agree with this position. I didn't mean to say that removal of tipping would solve the problem, more that it is an enabler of toxic behaviour. The more opportunities provided, the more likely assholes will be emboldened causing a normalisation effect both in them, and others around them.
Something that has occurred to me is that I have sometimes been that asshole entitled customer, and as I've matured I've learned to remove myself from a situation when I feel the urge to yell at a service worker.
It has never been about the money really. The only exception I remember was when I was upset about the way my bank processed my paycheck and yelled about it in my early 20s (my bad, I didn't know how depositing checks at an ATM worked but I ought to have). But usually it's because I felt insecure or disrespected in some way (which wasn't, to my memory, reasonable. It wasn't what the kids call a "valid crash out".).
For instance, it really gets under my skin when I am talking to technical support on the phone and they try to blame the problem on my running Linux. Argh! If it was Linux I wouldn't need their help! I'd either fix it on my own or ask some help forum.
I don't know how much that translates to the larger phenomenon, I'm not even talking about face-to-face interactions anymore, but that's my two cents.
I think most of the time this happens, you just don't realise the wait staff is patronising you. You certainly aren't buying better service.
That sounds a lot like bribing
What's crazy is that you can so confidently claim "tipping is a thing of the past" when it's... not? You can think tipping should go away, that's a completely valid viewpoint. But your statement is just objectively wrong.
I see this a lot (not specific to HN) - some person doesn't like $THING, so they just declare that that thing is bad, or "a thing of the past," or whatever.
Saying something is a “thing of the past” is the same as saying that something is archaic and should go away. It’s not a declaration of fact.
Or confidently declaring the _true_ motivations of companies/people, like they, the random internet person, for sure know why some company or a famous person are doing something, and express it as a statement of fact and an agreed upon common sense and not a speculation based on nothing.
Most seen on reddit but seems to be becoming commonplace on here as well.
"Horse riding is a thing of the past" is both clearly true and also wrong if you are being incredibly obtuse. The average person is not riding a horse, but there are still horse riders.
I see this a lot - some person doesn't like a phrase ("a thing of the past"), so they just misread it and take it clearly the wrong way.
There’s very little empirical evidence correlating tipping with better service.
There is evidence correlating being attractive to getting better tips, interestingly.
Anecdata, but I go to Taco Bell way more often than I should. There’s no tipping culture at Taco Bell, but the staff, at least at the one near my house, are always very nice to me and as far as I can tell my food is made with a sufficient amount of care.
When I do go to a restaurant that has tipping, people are usually nice to me as well, but I don’t feel like they’re really any nicer or better at their job than my local Taco Bell workers.
No, they're definitely more attentive for the tip, I just don't like it. If they're going to be extra nice, I don't want it to be for money. Felt nice going to other countries like Australia where the customer isn't always right but they still do their jobs.
Anyone who has worked in a restaurant or bar can provide plenty of observational data that if you provide better service you will be tipped better. I would recommend trying out working as a server/bartender you will understand tipping a lot better.
There is definitely a huge difference in countries where they tip and countries where they don't tip.
Also a tip goes to the pretty face who bring you plates.
However, the whole restaurant experience is made by many people: dishwasher boy, prep boy, shef, cleaning lady, etc.
They should tip to cleaning lady as dirty toilet can ruin whole "experience".
In many restaurants the tip is split between all of those people. You just don't know it because they don't exactly post their tip policy.
> Tipping is a thing of the past.
This statement is just not factual without some qualification. Where I live, and in the US in general, tipping is not a thing of the past. You can say you wish it was, you can say it should be, but what you said is not factual.
Tipping is a thing in Eastern (to be more accurate: Central) Europe too, but where I live, tipping is not taxed. Actually, let me be more accurate: people who pay with credit card always tip in cash, as there is no way to tip with a credit card[1]. :P If you buy anything with a credit card, the total amount must always be identical to the sum of the prices of the products, it can never be more, so cannot include tips[1], which forces people who tip to tip with cash.
Food deliveries (similar to Uber Eats in the US I suppose) have the option to tip, and 100% goes to the courier. 200 HUF (0.57 USD) is the most common amount (as per their website[2]). We do not use percentages.
[1] It varies and might not be universal.
[2] https://foodora.hu
"Cash is untaxed" is a universal rule; there's a food stall that only sells deep fried Vietnamese eggrolls (and has for decades), they prefer cash; in part because cash is untaxed and they may forget to document every sale on occasion, but also because they do relatively low amount transactions (<€10), the €0.25 transaction fee does add up for them.
It's also why "knowing a guy" can be useful, tradesmen coming in on their off hours to do a job for cash.
>>Actually, let me be more accurate: people who pay with credit card always tip in cash, as there is no way to tip with a credit card.
Eh? I don't know if you consider Poland eastern europe(I don't really), but I tip with a card all the time in Poland, you just ask "hey can I leave a tip on the card" and they bump up the amount by whatever you want to tip. And no, the amount doesn't then equal what's on the receipt - I don't know how they work it out internally, but frankly that's not my problem.
I agree with your post. But..
I'm from the UK and travel in the US a lot and US service is much better. I've never had to chase up the check or had to go and search for staff to serve me after sitting there for ten minutes. These are common occurrences in the UK for me.
Ideally, tipping wouldn't exist and everything would be priced in, but pragmatically, incentives grant extra benefits to both parties. Potential for more money for the server, better service (and the ability to punish bad service) for the customer.
(I know everyone making similar observations is getting voted down, so I appreciate I may simply be far off the bell curve on this and the majority experience the total opposite. But it's my reality.)
> I'm from the UK and travel in the US a lot and US service is much better. I've never had to chase up the check or had to go and search for staff to serve me after sitting there for ten minutes. These are common occurrences in the UK for me.
I've had these things in the US. In fact the service generally I've had is all for show, people being really "fake nice" and / or overbearing but then forgetting drinks or food items you ordered.
At least in the UK you can genuinely not tip someone without worrying about them being unable make rent..
But people do tip at restaurants in the UK. So what are you saying is the difference?
I’ve had fantastic service in countries where tipping is not the norm. I’ve had atrocious service in the US. UK service may be worse, but I doubt tipping is the reason for it.
Good service is common in industries where tipping doesn’t happen. What makes restaurants special that their workers can’t provide good service if all of their pay comes from their employer just like everyone else’s?
The Taco Johns near where I work has a tip jar outside the drive-thru window.
I don't know of any other fast food place that does that.
In my experience as a former enjoyer, Taco John's needs all the help they can get =P
That's why I never tip. Otherwise you're giving the perfect excuse to restaurant owners to lower wages.
- have a liveable minimum wage - force restaurant owners to pay at least that
period
If you’re in the US and refuse to tip, you should consider only eating out at places that pay more than the tipped minimum wage (in many states still $2.13 an hour). If you’re going to protest with your wallet, hurt the owners and not the staff.
> and have the restaurant pay their people for their work.
For that, you need the restaurant employees to be organized in a strong, independent, non-corrupt union; or a highly-upstanding restaurant owner/manager.
The latter is sometimes the case, but often/usually - not.
So, former is rarely the case, I'm afraid, because working-class consciousness in many countries is lacking; and forming a union is hard; and restaurant staff have a lot of churn, so by the time you get the idea to do this, or have started work on it, you might be going elsewhere.
But regular restaurant clients taking owners to task about wages is definitely a thing to consider...
“Tipping is a thing of the past” is just a completely false statement, given it’s the norm in the most economically powerful country in the world and not at all u heard of elsewhere (food delivery in many countries, high end restaurants in the UK and elsewhere, etc.) If we’re being generous we can call the claim is vs. ought distinction, except the phrasing doesn’t even leave room for the ought interpretation. It’s just a falsehood (were it was true).
> Pay for your meal
Not sure you know what tipping is, but it's not paying for the meal. It's paying for the service.
1. I like being able to pay for better service
2. Despite what people like to think, everywhere in the world has appreciated tips. I've never had a waiter refuse extra money. Literally dozens of countries, you get better service if you tip.
Not sure you know, but in literally dozens of countries, waiters get a proper salary.
The cost of a ”meal” in a restaurant is: rent, wages (for chefs, managers, wait staff, etc) ingredients, profit margin, taxes and likely a dozen other things.
Taking one of these items out of the cost and trying to charge it separately is a strange practice.
Japanese waiters will literally refuse your money of your try to tip. It's literally insulting to them if you offer more than asked for
The tip is usually given at the end of the service. How does that ensure a better experience during?
There are 3 types of countries x industries (because even within a country different cultures may apply)
1. Places where service workers are paid peanuts or nothing and tipping is considered mandatory
2. Places where workers get a basic actual salary and tipping is rather voluntary (and can be more or less expected)
3. Places where tipping is not an actual practice and can make things awkward even, depending the amount.
In reality, 2 is a spectrum between 1 and 3.
Not sure where you have (or haven't been), but I've been to several countries where I've tried to tip, and it's confused or even embarrassed the staff. They insisted I take my change. Granted, this was 15-20 years ago, and unfortunately tipping has become more pervasive, not less, so maybe if I were to revisit those places, things would be different.
But I do know this is still the case in Japan. Some Japanese service workers or small business owners will even be insulted if you try to tip.
Having just come back to the States from a trip to Europe — sheesh, I hope not. The service at restaurants everywhere in Europe was at best mediocre, and typically god-awful. Incentivizing good service is good.
Yes, yes, "but the price on the menu says..." Whatever. If you're in the U.S., it's normalized that the price you actually pay is 20% higher, assuming they treat you well. Restaurants don't typically print the tax on their menus either, and yet no one tears their hair out over having to pay sales tax, and various city taxes, etc etc.
The service is so, so much better in the U.S. because of tipping. Tipping culture is good.
Maybe you went to mediocre restaurants?
Tipping sucks and your taxes suck too. When I see that something costs 15€ on the menu then I expect to pay 15€ and nothing more. How can you be happy about surprise taxes? How can you plan your spending when you don't see how much something costs and you still think this is superior?
I dunno, I was in Europe (Belgium and France) last summer, and I thought the service was generally excellent. A bit slower in France, perhaps, than in the US, but I chalked that up to people just generally not being in as much of a hurry as they can be in the US. (And hell, there are plenty of places in the US where service is slower than I'd like.)
We tend to avoid touristy areas, though, when we travel, so maybe that explains the better service. If I had to work in a service job that caters to tourists, I'd probably be less happy too.
Having been to Europe multiple times, hard disagree. I don't know why you had bad experiences everywhere, but I have hardly had any.
I'd expect all prices to include taxes, be it restaurants or other shops. Everything else is just making it harder for the customer for no reason at all. What you see is what you pay.
Service is quite good in Europe if you ignore the touristy areas. We’re also not into that fake-smiling thing, so maybe that can be seen by an American as “bad service”.
On the other hand, when I visited US on a work trip we've had an absolutely awful service at a restaurant, like the waiter was genuienly rude to us, and at the end I said ok, well, this was awful, I guess we're not leaving a tip then - and our American host laughed and said no, you still have to leave a tip. Why? Because it would be rude not to. And these people earn very little so you have to leave a tip. But.....the service was bad? Why would we tip? "because you have to".
That's nonsense. In the UK if the service is good I leave a tip. If it isn't then I don't. From my (limited) experience in the US it looks like you have to tip regardless. If that's the tipping culture then that culture is rotten.
>>The service is so, so much better in the U.S. because of tipping.
Honest question - do you consider waiters who ask you if you need anything every 2 minutes "good"?
>> The service at restaurants everywhere in Europe was at best mediocre
What's your opinion on restaurants in Poland? Was the service better or worse than in Spain? How was it compared to Czechia and Slovakia?
Not my experience.
I've got great and shit service in Europe.
I've got great and shit service in the US.
Tip/no-tip hasn't been a factor.
For example, Amazon caught lowering delivery driver pay with the tips making up the difference and then lying about it: https://www.ftc.gov/system/files/documents/cases/amazon_flex...
> At the outset of the Amazon Flex program, from 2015 through late 2016, Amazon paid drivers at least $18 per hour plus 100% of customer tips
> Beginning in late 2016 ... Amazon secretly reduced its own contribution to drivers’ pay to an algorithmically set, internal “base rate” using data it collected about average tips in the area ...
> For example, for a one-hour block offering $18-$25, if Amazon’s base rate in the particular location was $12, and the customer left a $6 tip for the driver, then Amazon paid the driver only $12 and used the full customer tip of $6 to reach its minimum payment of $18 to the driver.
And their punishment was just to pay back what had been taken: I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back.
The largest type theft done in the United States, by far, for decades, is wage theft. In terms of dollars stolen.
All other forms of serious crime have dramatically fallen since the 90's per Capita. Some are at 1/3 the rate they were then. (FBI UCR)
remember that next time you see a headline or politician speak about crime.
We are safer, doing less crime to each other, and seeing more prison population than ever before.
While corporations crush us illegally and face no consequences.
The US prison population has been declining since 2010: https://en.m.wikipedia.org/wiki/United_States_incarceration_...
In this case[0] the CEO (Chris Kirchner) stole ~20M$ from the company causing employees to go unpaid for months, and outside of California all they got was owed wages (no interest or anything). While mentioned in the article, what he was mainly convicted of was defrauding investors rather than stealing from employees.
> Apparently, projecting personal prosperity was more important to him than making payroll
He actually had the temerity early on in the debacle when he was still pretending there was money to tell us that they had decided to not pay us that week because it would be bad for the companies investments to withdraw funds then.
[0] https://www.justice.gov/usao-ndtx/pr/slync-founder-sentenced...
> I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back.
There was a very famous viral video of a woman stealing offering to just pay for the goods when she was caught, but we all understood why that was a ridiculous idea. Maybe she was just an Amazon VP, so she didn't know any better
My tips have been going down progressively, when I moved to the US I was taught 20% is "normal", now I tip 15% at MOST at restaurants and at MOST 5% on take out.
I'm tired of being shamed to pay more for less.
Also whoever was in charge of teaching staff to "turn away in shame" when the tipping screen is shown needs to go to some sort of gulag.
> and at MOST 5% on take out
Why would you ever tip on take out? What are you tipping for exactly?
The people who cooked the food
You know what would actually help workers in tipped positions? Going after wage theft. Taxes on tips are a drop in the bucket compared to wage theft.
Aren't we creating incentives for workers abuse:
- No tax on overtime: so now making them work 60 hours a week is cheaper for the employer
- No tax on tips: so the tip based payment model is cheaper
Yes, and my understanding is that this is precisely the point.
Income tax is paid from employee salaries/wages, not by employers.
Doesn’t matter, money is fungible.
Not sure how is it now, but when I worked in a plant overtime work was paid at 150% rate of regular pay. Work during national holidays was paid at 200% rate. Isn’t this still the case?
(The workforce at the plant was unionized and the higher rate may have been part of the labor contract. This was in Montreal Canada about 25 years ago. )
How is it cheaper for the employer?
They can pay lower wages because the employee is losing less of their income to tax. Supply and demand.
For the same amount of money employee gets it requires employer to pay out less.
I, personally, believe tipping is detrimental because it encourages preferential treatment. When workers know someone is a generous tipper, they often provide better service to that person than to others who tip more modestly.
In many cases, tipping functions like a form of bribery, incentivizing employees to offer favors or services beyond what is appropriate, which can come at the employer's expense.
It can also create resentment toward customers who don't tip, leading workers to offer poor service and fall short in their duties.
I can kind of see the average traditional service work position to shift into a Uber-esque model where you are a essentially a gig contractor. The worker takes the full risk for slow days, and the business owner does not have to pay you a salary, as everything comes from the customer.
That’s exactly what US waiter employment is. And it needs to die.
Just a historical note as a consolidated response to those who identify 'tipping' as an 16th through 20th century invention. This is incorrect as humans had 'tipping' all the way back to earliest recorded times.
In the middle ages vails or informal rewards were given to well performing servants. In the Roman times corollarium (Lucilius, Seneca), a form of tipping was known. Cicero referred to tipping as stipen although some argue that is not above regular pay.
There are some evidence that in the Han Dynasty, gifts were bestowed on well performing eunuchs, above their normal pay. Considering that in ancient times payments often were in non-monetary compensation, this could be considered a progenitor of tipping.
Incas had similar systems of rewarding service with goods like cloth, though not exactly like modern tipping.
Tipping, as we understand it today, likely did not exist in the same form in ancient civilizations, but there were practices where extra gifts or payments were given for exceptional service.
> What has been will be again, what has been done will be done again; there is nothing new under the sun.
> "we are going to not charge taxes on tips"
It's been a very long time since my last visit to the USA. I probably paid tips in cash back then. I would assume that workers can chose to never report those tips as income, or not all of them, so no taxes. But if everybody went cashless by now, customers probably pay the restaurant, the restaurant pays the tips to the workers and all of that money is tracked and taxed. Is that correct?
Yes, that is correct.
yes
All bonuses soon to be labelled as tips.
This is unlikely to be allowed, the last I checked, the law explicitly only allows "traditionally tipped jobs". How it gets interpreted and implemented in IRS Tax Code isn't clear yet, but they will probably have rules in place to prevent this.
Doesn't change the fact that it is a terrible idea.
Hmm, this makes me wonder though -- I have noticed various projects on Github and various other sites allow for users and fans of projects to donate to the developers and maintainers. Who hasn't seen the "wanna buy me a coffee?" button on a site before?
I am not sure if the money from such sources was ever taxed as income, but if so, then I wonder if such will be non-taxable now? Considering donation and tip buttons have some history behind them, perhaps such "jobs" could be considered "traditionally tipped jobs?"
At least the current version of the code has a ton of limits on what can be labeled tips, and the benefit phases out completely around $150k, and is only applicable to professional that traditionally receive a significant portion of income from tips - so it's not like you're going to have billionaires and PE fund managers paying themselves from their companies tens of millions in bonuses labeled as "Tips" and not paying any tax.
~90% of tipped workers REPORT less than $61k in income already. At that income, you're barely paying much income tax anyway.
This is just a trick to make people think they wouldn't have to pay social security and Medicare - which is the main tax they're paying - when in reality, ~90% of tipped workers will get next to nothing.
Plenty of early stage PMC jobs make under $150k, pay bonuses and CEOs would gladly be able to pay a little less if they can finagle it to be tax free.
Do they have a list of professions and industries eligible or are they going with weak “traditionally tipped “ language?
And we expect the DOGEd and defanged IRS to vigorously enforce?
My daughter works at a mid-tier restaurant 35 hours a week and makes more than my wife who is a math teacher, department head, and has many years of teaching experience.
Eliminating tips and increasing the base wage is a stupid idea. All the talented servers who love the job will leave and mediocre people will replace them.
Having no required tips and a higher base wage works just fine in other countries. I think you're overstating your case.
What exactly are they going to leave for? What well paying skills is your daughter not putting to use so that she can help people get food?
except that most people -- including me -- hate it
raise prices by 20% and drop "mandatory" tips which is what they have become
then tipping can go back to what it was -- optional extra to reward excellent service, not an unspoken part of the bill
The most galling part is how the industry manages to manufacture worker consent through PR spin and management plants in hearings
Doesn't this also open a huge opportunity for tax evasion?
Say I am a small business owner selling a $90 item which is $100 with state sales taxes. I say if you are willing to tip me at least $90, the item is $1. The buyer saves $9 from state sales taxes, and I save on income taxes because tips are exempt from tax.
The law accounts for this. Jobs and industries that previously and traditionally don’t work on tips cannot convert to a method you describe.
Yes, this rarely seems to come up in discussions of restaurant tipping culture in the US but especially given that a lot of municipalities have additional hospitality or food and beverage taxes over and above sales tax, there’s a strong incentive to keep menu prices low by encouraging tipping, as a way to minimize the taxable portion of the bill.
If I need to make sure a server earns $200 after tax for a shift in order to be able to attract them to work for me, it is definitely to my advantage for as much of that money as possible to come directly from the customer as tips.
I’m not sure if this is meaningfully different from offering a cash discount because you evade taxes on cash transactions.
And EMV fees.
It's fascinating to see the correlation in opinion between taxing tips and raising the minimum wage.
If the prevailing sentiment was to make things easier for low income workers, I would expect people to want to not tax tips, and increase the minimum wage. And people who want less government interference, would want less tax, and lower minimum wage. Those are the two opinions I expected to see.
But instead it seems like people want to tax tips, and increase the minimum wage, which is evidence of a kind of authoritarianism that I did not expect.
Tips are still income. If we increase the minimum wage so that people can afford to live then I can't see any reason why we wouldn't tax tips also.
If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break. A better solution would be to prevent restaurants from paying their people poverty wages, and if servers aren't risking starvation and homelessness if they go without tips for a week then why would you not include their tips in their regular income?
Raise the minimum wage, require servers to be paid minimum wage, and enforce a straightforward tax on people's income that doesn't distinguish wage from tips. Maybe also increase the 0% tax bracket to something more reasonable, like $20-40k, just to simplify things for people who are struggling to subsist while we're at it.
> require servers to be paid minimum wage
There is no jurisdiction in the US that allows servers to be paid less than the standard minimum wage. Even where you find server minimum wages (your $2.50/hr example, although not all states allow this) the employer is required to top up to the standard minimum wage if tips don't cover the difference.
Which makes this kind of silly,
> If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break.
If $2.50/hr + tips exceeds minimum wage, why do you need a special break? You're making more than other minimum wage workers. If $2.50/hr + tips does not add up to minimum wage, the employer has to get you to minimum wage, so you are making no less than someone else making minimum wage.
If people with low income need a break, just give people with low income a break. How that low income is derived is irrelevant.
Tax on real tips i.e. cash was already unenforceable, but perhaps it's nice to codify it. Then again, it feels like just another step to shift transactions away from cash.
Why don't yall ask the tipped workers if they are happy or upset about having no tax on tips?
"Y'all" would be pretty silly to ask a question of little relevance.
Why wouldn't I ask them whether they were happy with their overall compensation, including health benefits, retirement, hours being scheduled, vacation or sick time.
Should I ask those in the back who may or may not be getting the tips from the table?
“No Tax on Overtime” ditto. As I understand it if it’s overtime negotiated through a union contract, you’re out of luck.
Tips are the most cynical thing I've ever seen.
Tips are supposed to be "in return for a service, beyond the compensation agreed on" (WordsAPI).
If tips instead mean "it's something you have to give when you had no problems with the service provided", and you expect routinely not to have problems with such service providers, then it's implicitly agreed that tips are required, so they are not tips anymore.
It’s simpler than that. It’s gross vote buying and political patronage. Nevada has a large population of tipped service workers. Trump won the state by the largest margin for a Republican since W. Bush in 2000 (back when the state was 65% non-hispanic white versus 45% today). It was probably instrumental in Trump winning hispanic men nationally.
It is interesting that the no tax on tips would expire in 2028, while the tax breaks, most affecting the wealthy, were made permanent in the same bill. A bit of political game i'd say.
Also, "The maximum annual deduction is $25,000 for individuals."
Taxes are still being assessed, and tips over $500 a week won't have their tax refunded.
Some rhetoric during BBB debate was a side effect of a similar political game; cuts for "middle class" in the Tax Cuts and Jobs act from 8 years ago were due to expire, benefits for corporations were not.
"No tax of tips" is one of the most brilliant political ploys ever. You really gotta give Trump credit. It doesn't really cost anything, businesses love it, and you can trot it out as a victory for the working class while you screw them on their health care or energy costs.
Idk, tipping expectation is really unpopular, and anyone can see how this feeds it.
It’s not really, it’s the kind of thing that only a populist could do. If a Democrat did this, people would hate it for this very reason. This would just another “NeoLib” concoction to screw the working class.
Trump is a populist president.
People just don't recognize it because right-wing populism is a different breed than left-wing populism (the only one they have had exposure to).
Tariffs are a populist move as well. If you go look at Bernie's old website (pre-trump) he has a whole section about the importance of tariffs.
All this is just the result of playing a zero sum game with industry that is traditionally very low margin. The money always comes from somewhere.
I’d honestly like to hear from someone who is a proponent of tipping how they think it makes any sense. By that I don’t mean I need the reason for tipping explained to my, everybody understands the argument for why you should tip: but how does it make sense when you consider who you tip and who you don’t?
Do you understand the part about how the tipped minimum wage being so much lower was born largely out of racism?
Even if that's true, what does that have to do with anything?
I’ve finally eliminated all tipping in my life for anything that isn’t sit down restaurant service or an uber ride, and I’ve stopped using delivery apps to instead just pick up food myself.
At first it feels shitty hitting 0 or “no tip” on a payment machine but after the first several times it feels empowering and I doubt employees give a shit anyway. Just do it.
I never understood tips...
You have a farmer that grows/raises food, butchers and others that 'process' it, you have a team of cooks who prepare/cook the food, and you're supposed to tip the the person who just brings the foor from the kitchen to your table, maybe 20, 30 meters away?!
Sadly, tipping is sprading all over europe too with POS terminals bothering you more and more often for tips.
I grew up in France and tipping in restaurants was definitely a thing, albeit on an entirely different scale than in the US.
Leaving a few francs (I'm not young) was common practice.
With cash payments growing more rare, and without the ability to tip easily with cards, maybe it became much less common.
That said, I don't disagree with your comment on how it's spreading. What I don't love about the terminals asking for tips is that, IMO, it creates an expectation of tipping that wasn't there before.
Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant.
On the other hand, we regularly eat out at a place near us that only takes cash. We usually spend about 18€ and I always leave the extra 2€ as a tip.
>Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant.
I've lived in Portugal for 30 years and I never had that happen to me. Where are you seeing this? I could only imagine it in a place that only serves tourists and foreigners.
Bribing a driver in order to receive an order accurately seems archaic.
I’ll drive there myself, thanks. My pup gets a ride. The apps get the finger. The drivers get what they deserve.
Wins all around.
It's also a joke, because anyone who's worked a service job knows there is no tax on cash tips (wink!)
Which made a difference 2 or 3 decades ago.
But today, who's getting tips in cash? Not many. Customers are paying for everything with credit cards or contactless, save for the occasional cash-only coffee shop or restaurant.
> who's getting tips in cash?
About half of the large tips at high end restaurants in my town are cash. Sounds like it is about a third in New York. Especially if it is folks who work at a restaurant.
Exactly. My girlfriend who works in sales (sells food) in LA barely gets tips in cash. Most people use their cards. And thus, her tips are tax deductible.
tbf it's one of the few times i try to carry cash.
I just don't trust management of places not to take a cut if it's done digitally.
> But today, who's getting tips in cash?
Every server who waits on me.
I make it a point to carry cash and tip the waitstaff in cash even if I pay the bill on my credit card.
1) Tips on credit cards are a "dark pattern" meant to increase the house rake of the credit card handling companies.
2) Tips on credit cards are controlled by the owner and often never make it to the waitstaff.
I can short circuit this by giving my servers tips in cash.
I should have specified that I live in the east-coast United States. Tap-to-pay is almost as common as someone writing you a paper check or an IOU, out here.
I have an honest question: what's the cash vs card tip ratio? 99.999% of the time I am not carrying cash and I don't see many (any?) people paying with cash ANYWHERE in the last 10+ years.
At this point you are litterally a sucker to pay for anything in cash, because everything is marked-up to cover CC fees, which you get a portion of back in the form of rewards.
Yes, I know some places give cash discounts. Most do not.
Almost no one can give you a good answer because it varies by business type and location.
My business does not involve tips (exactly) but I can tell you that I’ve seen anywhere from 20-40% of money run through my system being in cash, depending on where I am in the country.
in SF I only carry cash for dive bars and the occasional mom n pop diner
NYC here, whole lot of cash still showing up in tip jars - there are still and loads of cash-only places around, from bars, restaurants, to street carts, you name it. JG Melon, for instance, is famously cash only. But so too is the bar around the corner from my apartment (Dynaco, do recommend).
...So people often tend to be carrying cash still.
Haha, I had the same thought but now basically everyone is digital so I think its a different ball game than we are used to. At least as a restaurant server/bartender.
Sounds like those Americans aren't paying their fair share.
The negligence of their national responsibility will be felt like an earthquake by millions of Americans. It's hard to imagine how they live with themselves.
When I worked as a waiter (many years ago), my pay check included tax withholding based on 8% of my tables for that pay period. This is driven by IRS rules: https://www.irs.gov/taxtopics/tc761#:~:text=If%20the%20total...
We had to declare our tips at the end of the night, and 10% was the lowest you could claim without needing manager approval. You can guess what everyone declared.
Stonk grants and options are tips too - no tax thanks.
I never put a tip in at a kiosk.
this is why we need to end this ridiculous tipping culture
How about the tips that I get as a musician?
The IRS is going to publish a list of eligible occupations by years end.
like being president, and getting crypto tips from supportersuckers
Do you report them?
Of course.
How is an expected tip different from a commission other than who pays?
This is rather brilliant. * make it look like the government is stealing “gifted” money * stop taxing it * turn as many jobs as possible into tipped jobs supposedly for the person’s benefit * really the employer wins since they’ll pay less and claim “tips”
Yeah we just had to sell out medicare, bomb Iran, destroy USAID, and now restaurant workers can blame the public more for their thief employers not paying them a living wage. I have happily nearly eliminated eating out partially because tipping has become ridiculous but restaurant prices are still very high post-pandemic. Fuck tipping.
Trump is clearly the most powerful president of all time, and he basically controls everything.
I worked as a server for about a year in college, and when we would check out at the end of the night, literally, everyone would just put zero. As in they didn't earn anything. Every time. I'm sure it mess with the taxes in someway or another.
I think with any conversation about tips it is really important to recognize that laws vary dramatically across states[0]. I think talking about this can really drive at the real underlying issues with tipping.
IMO most discussions about tipping are a distraction. "Divide and rule" if you will.
So the real (main) problem is actually just straight up good old wage theft. Anyone who is not getting at least minimum wage is suffering from wage theft.I've heard stories of employees not getting a paycheck "because employer thought it was all tips" (illegal b/c they credited too much) or very small paychecks with the explanation that the employer over-credited tips. There's at least a decently straight-forward way to show what can be credited, and this is why there's the tip amount that you log. Ignoring cameras, the burden is on the employer to prove that they can make these credits, so that line-item on the bill is important (IANAL)
I think the entire discussion of tipping often only serves as a distraction to wage. Like there's a lot of person to person fighting of how much we should tip (including not tipping) and frankly, doesn't this discussion often boil down to wage theft? I mean ignoring the already illegal problem of wage theft, what makes a server (who gets tipped) any different from a cashier (who doesn't get tipped) as an employee. Their jobs differ in duties, but we're talking about wage and *fair pay* here. If all the laws are followed, a tipped employee strictly benefits from tips. They have a statistical wage but that wage is max(base_pay, state_minimum) + random_value.So I think 90% of discussions around tipping end up just being a distraction to create a fictitious divide of "minimum wage workers" vs "tipped workers"[2] who should instead be working as a coalition to increase the floor. They are both minimum wage earners! The main difference is primarily that tipped employees are just more likely to suffer from wage theft, due to how they are paid. But that's also something that both experience, just at different rates.
[0] https://www.dol.gov/agencies/whd/state/minimum-wage/tipped[1] https://www.dol.gov/agencies/whd/fact-sheets/15-tipped-emplo...
[2] Simplifying by ignoring tipped earners with higher than min wage base pay (we can extend as needed)
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According to my accountant for my wife’s small business (nail and wax salon) this tax law change will have a significant positive impact on her staff. Not sure what to make of this article, it seems pretty disingenuous.
N=1. Just because your wife's business doesn't fall under the conditions that the article is talking about, it doesn't mean that her business is the norm.
Sure, my experience isn’t with sharing, basically. Nice.
I'm just planning on tipping less to make up for it. In California minimum wages are already $20/hr, and on top of that so many places expect a higher %ge, tip, just cutting my tip by the 10% they pay in tax and being done with it. I pay taxes on my wages. They should too
Two steps short of legal prostitution. Maybe the worst idea from the administration so far. Time to build the app…
I don't like tipping as much as the next guy, but this isn't about that. It's about government overreach and privacy.
Governments tracking small transactions like tips and taxing them should bother everyone. That rag, the New Yorker, knows that of course.