A Gratuitous Conversation about Tipping

It's an extremely tedious revolution, but American service culture is slowly, painfully, being dragged into a new paradigm of dining.

To quote from the first article:

Tipping, as a compensation scheme, is great for everyone.

Restaurant customers like tipping because it puts them in the driver’s seat. As a diner, you control your experience, using the power of your tip to make sure your server works hard for you.

Restaurant servers like tipping because it means their talent is rewarded. As a great server, you get paid more than your peers, because you are a better worker.

Restaurant owners like tipping because it means they don’t have to pay for managers to closely supervise their servers. With customers using tips to enforce good service, owners can be confident that servers will do their best work.

There’s only one problem: none of this is actually true.

The author goes on to show why tipping is a broken system that in fact actively discourages good service and actually encourages profiling of patrons:

Researchers have found (pdf) that customers don’t actually vary their tips much according to service. Instead they tip mostly the same every time, according to their personal habits.

Tipped servers, in turn, learn that service quality isn’t particularly important to their revenue. Instead they are rewarded for maximizing the number of guests they serve, even though that degrades service quality.

Furthermore, servers in tipping environments learn to profile guests (pdf), and attend mainly to those who fit the stereotypes of good tippers. This may increase the server’s earnings, while creating negative experiences for the many restaurant customers who are women, ethnic minorities, elderly or from foreign countries.

On the occasions when a server is punished for poor service by a customer withholding a standard tip, the server can keep that information to himself. While the customer thinks she is sending a message, that message never makes it to a manager, and the problem is never addressed.

I realize that those of you who have worked in the service industry have probably already stopped reading to write a vehement attack on the part I bolded. Yes, I work in the service industry too. Yes, I realize that the stereotypes mentioned above are absolutely real. . . but let's try to avoid the chicken and egg conversation. It doesn't matter if it's the server or the patron that causes bad tips if there's an elegant solution to fixing it, right?

I know I won't escape the "in Europe we do it this way and we think Americans and Canadians are stupid" posts, and honestly I welcome the perspective. Given all the discussion we've had about low wage earners, we're talking about a huge and growing segment of the population that's wholly reliant on the tipping habits of patrons to meet basic needs. Mandatory gratuity effectively works as a flat tax, guaranteeing service professionals a wage based on the amount of funds spent by the patron. This make service industry work no different than a car mechanic, an HVAC technician, or any other skilled trade worker. This is especially so for highly trained service professionals, who may have attended bartending/mixology school, attained a cicerone certification, or some other additional training.

Cicerone?

Between you and "The Borgias," I'm having to google more Italian than I ever wanted to.

A mandatory gratuity sounds like an excellent idea. Problem solved! Thanks, Seth.

Why not just change the idiotic law that allows servers to be paid sub minimum wage? And while we are at it, f*cking bottle deposit. Seth knows!

A Gratuitous Conversation about Tipping

I see what you did there.

All of that said, I would say the amount of tip I leave IS determined by the level of service I receive. I'm not going to leave NO tip, but waitresses/waiters who provide good service, I do tip more. And those places where I've regularly ate over the course of time came to know me as someone who would do so (and you would not believe how quickly I got my food and how often I got checked on in those very busy places).

And feedback never getting to management? What planet is that writer living on? Seems like everytime I go out, there's someone complaining to management about every little thing usually looking like they are hoping to get a free meal out of it.

Demosthenes wrote:

And feedback never getting to management? What planet is that writer living on? Seems like everytime I go out, there's someone complaining to management about every little thing usually looking like they are hoping to get a free meal out of it.

Yep, so far as I can tell, the only way to get fired as a server is to post a photo on Reddit. Complaining old bitties are generally the ones to complain.

I agree with everything you said, Demosthenes. Problem patrons won't just go away with a paradigm like this, and in fact might incense them more. "I have to pay a service fee for this?? I will stamp my feet and humiliate myself in indignance!"

One really good counterpoint I saw was that going to a system like this makes it impossible to hide tip wages from the government. That opens up a whole conversation about what a broken system we live in where people pretty much have to hide tip wages from income tax in order to make ends meet, but at this sad point in time it's a valid point. Cash tips are viewed as "under the table" by a huge portion of servers.

Second -- as someone pointed out in the low wage earners thread (and this still blows my mind, but the statistics were there), some unscrupulous bar/restaurant owners are dipping into tip money. This is a really, really terrible crime, but it happens -- and having the POS system collect those wages would make it a lot easier to institutionalize this practice.

I.e., "18% service charge, 3% of which goes to "operational costs" and 15% of which goes to the servers." <---NOT COOL.

edit --the counter-counter point is that that's EXACTLY how places like a repair shop works. It's not like the guy fixing my car is actually making that 75/hr wage I'm being charged on my receipt.

Charge me for the meal I order, and pay your goddamn staff correctly. Tipping is an archaic aristocratic affectation that allows restaurant owners to hire serving staff for piddling wages.

I tip pretty generously by most European standards, utterly over the top by Scandinavian standards, and not at all if there's a mandatory service charge. If the restaurant is going to charge for service I'd rather put the tip in the server's pocket than pay it to the owner in whom I have little or no faith to redistribute that to their staff.

Maq wrote:

Charge me for the meal I order, and pay your goddamn staff correctly. Tipping is an archaic aristocratic affectation that allows restaurant owners to hire serving staff for piddling wages.

This. A lot of the time I tip out of feeling guilty if I don't, since I know most wait staff are paid sh*t for wages.

Maq wrote:

Charge me for the meal I order, and pay your goddamn staff correctly. Tipping is an archaic aristocratic affectation that allows restaurant owners to hire serving staff for piddling wages

Basically this.

If I don't like the service I'll never come back and if I really didn't like the service I'll make a complaint. Withholding tips is passive aggressive bullsh*t.

Farscry wrote:
Maq wrote:

Charge me for the meal I order, and pay your goddamn staff correctly. Tipping is an archaic aristocratic affectation that allows restaurant owners to hire serving staff for piddling wages.

This. A lot of the time I tip out of feeling guilty if I don't, since I know most wait staff are paid sh*t for wages.

Here's the problem with that system. Let me preface this by admitting I'm going to make a "but all them other jerks" statement. Let's for the point of discussion assume none of us here are jerks. . .

But all them other jerks are going to go to a place where a hamburger is 9.49 and the IDENTICAL burger is 7.99 across the street, and they will forget (or won't care) that the 18% difference goes to the server, and walk across the street for the 8 dollar burger. That's why it's difficult to bake service fees into food costs. I totally agree that this system would work in theory, but. . .there's a long list of businesses that have long switched to itemized bills that include labor/service charges as a separate line item.

I can see that point too. And it's frustrating because it's accurate. But I do at least choose to shop at places where the employees are treated right even if it hits my pocketbook a bit harder than going to the cheapest place.

My immediate assumption if there's a mandatory service charge is that the servers see none of it. I don't know anyone who works in the service industry who does.

No tipping in Japan. It's fantastic. They also have fantastic service but that's cultural.

I've been told that some people here get extremely upset if you try to tip. Have not encountered that myself and have seen a few tip jars.

Personally, I despise tipping. As a customer, it really ruins the experience. Creates a situation that shouldn't exist in the first place.

Seth wrote:

But all them other jerks are going to go to a place where a hamburger is 9.49 and the IDENTICAL burger is 7.99 across the street, and they will forget (or won't care) that the 18% difference goes to the server, and walk across the street for the 8 dollar burger. That's why it's difficult to bake service fees into food costs. I totally agree that this system would work in theory, but. . .there's a long list of businesses that have long switched to itemized bills that include labor/service charges as a separate line item.

But that's the thing, isn't it? There's never an IDENTICAL burger across the street. Similar, perhaps, especially for chains, but never identical.

People like to eat at restaurants where the food is good. As long as the food is tasty people will want to eat there. Heck, they'll even put up with sh*tty service and pay through the nose if the food is good enough.

So if a restaurant's burger is good enough, it can charge enough money to cover the service fee. Hell, if the owner is smart about it, they can make the fact that their restaurant pays their staff living wages and doesn't force them to rely on tips as a way to further stand out from the crowd. Several restaurants, such as Sushi Yasuda in NYC, have eliminated tipping altogether.

The businesses that have switched to including labor or service fees are in industries with essentially identical products. A good example would be airlines. Unless you have SuperPlatinumBusinessTravelerExtreme status, you get the same product no matter what airline you chose: a cramped seat inside an aluminum tube. And you decide which airline's cramped seat you sit in primarily by seeing who charges the least amount on whatever travel website you use to book flights. The airlines know this so they keep their ticket prices artificially low. They then rely on a host of ever-increasing bullsh*t fees to make up for the fact they've incorrectly priced their product. The result isn't that you get better service, you just hate airlines a bit more.

Now look at what cereal manufacturers did. When the price of fuel and wheat went up dramatically a few years ago, they didn't tack on a service charge or even increase their prices. They simply put their products into slightly smaller packages and kept their prices the same. So there are plenty of ways restaurants can pay their staff appropriately without resorting to blanket fees.

What, no one has posted the clip from Resevoir Dogs yet?

I'm not opposed to tipping. Being married to a former waittress and understanding the sh*tty system that American waitstaff have to deal with, it doesn't bother me. What does bother me is the trend that tipping is being extended to any and every food-related business. There are tip jars seemingly at every fast food place. I do not tip fast food workers as they get paid based on regular wage rules and I usually pay by bank card so there is no extra cash to drop in.

I read an article recently where a guy was fired for complainging (and posting about) not getting a tip for a $175 food order. The problem is that he worked a sandwich counter. He didn't serve the food, he just made the sandwiches. You know what? Your job is to make sandwiches. You get paid minimum wage (or higher) to fill sandwich orders. How about you do your friggin job and be happy you have it (or I should say had it). So I personally have no problem with the guy getting fired for complaining about not getting a tip that he should never have gotten in the first place.

Hey, I referenced that Sushi place in the OP!

I'm not sure that food service can be accurately compared to cereal manufacturing. Making a slightly smaller burger is a very dangerous practice; theoretically, it can pay off, but there's a reason why the stupid-big half pound burger is now par for the course in restaurants; people are willing to pay for food they're probably going to waste.

You do have a point. There's an unspoken but widely ranging fight about whether people prefer bundled pricing or itemized pricing. I would claim that itemized pricing has largely been declared the winner -- everything from automotive and home repair to ticket pricing and even airlines and rental cars are moving to an itemized model. And while people complain about being nickel and dimed, they've also pretty universally condemned Cable Companies for their practice of bundling services/channels. That said, every place is different. Labor is not a line item in all of those businesses.

If your point is "people will pay more for a better burger," I agree....but the fact that Olive Garden exists shows that all them other jerks don't.

Nevin73 wrote:

What, no one has posted the clip from Resevoir Dogs yet?

I'm not opposed to tipping. Being married to a former waittress and understanding the sh*tty system that American waitstaff have to deal with, it doesn't bother me. What does bother me is the trend that tipping is being extended to any and every food-related business. There are tip jars seemingly at every fast food place. I do not tip fast food workers as they get paid based on regular wage rules and I usually pay by bank card so there is no extra cash to drop in.

I read an article recently where a guy was fired for complainging (and posting about) not getting a tip for a $175 food order. The problem is that he worked a sandwich counter. He didn't serve the food, he just made the sandwiches. You know what? Your job is to make sandwiches. You get paid minimum wage (or higher) to fill sandwich orders. How about you do your friggin job and be happy you have it (or I should say had it). So I personally have no problem with the guy getting fired for complaining about not getting a tip that he should never have gotten in the first place.

I hate to be that guy, but if you made a $175 order at a sandwich shop, you did one of two things... you held up the line, thus reducing number of tips possible... or you made a phone/internet/fax order, which needs to be managed over time while also satisfying a lot of other customers who are coming in during the lead up to that lunch/dinner time rush. I'm not saying like a 15% tip is necessary, but that's a lot of strategic work on getting that order completed on time that I would say is pretty similar to serving.

Or a service charge for orders above 20 dollars!

Seth wrote:

I'm not sure that food service can be accurately compared to cereal manufacturing. Making a slightly smaller burger is a very dangerous practice; theoretically, it can pay off, but there's a reason why the stupid-big half pound burger is now par for the course in restaurants; people are willing to pay for food they're probably going to waste.

It's actually bad business to make ridiculously large serving sizes. It both increases a restaurant's ingredient costs, and it also means that customer isn't going to eat there tomorrow because they took home a doggy bag.

Again, if the food is good enough, you don't need a metric asston of it for people to be happy.

Seth wrote:

You do have a point. There's an unspoken but widely ranging fight about whether people prefer bundled pricing or itemized pricing. I would claim that itemized pricing has largely been declared the winner -- everything from automotive and home repair to ticket pricing and even airlines and rental cars are moving to an itemized model. And while people complain about being nickel and dimed, they've also pretty universally condemned Cable Companies for their practice of bundling services/channels. That said, every place is different. Labor is not a line item in all of those businesses.

And I would disagree, especially for food. People want itemized invoices for things like repairs because they want to make sure that everything that was broken got fixed and that the mechanic didn't try to sneak in charges for extra parts or labor that weren't needed.

You don't ask for an itemized check at a restaurant that includes a breakdown of the ingredient cost, the labor for the chefs, and a "clean plate and silverware" fee that covers the dishwasher. You pay for the food and everything else should be accounted for that in the food's price.

Rental car companies are another example of an industry that offers the same product. It doesn't matter which one you chose, so you chose on price. And people hate cable companies and bundling because they don't want to pay for sh*t they don't watch.

Seth wrote:

If your point is "people will pay more for a better burger," I agree....but the fact that Olive Garden exists shows that all them other jerks don't.

Olive Garden exists because people like to eat Italian food. And Italian foods like pastas are also one of the lowest cost/highest margin dishes restaurants can serve.

I am enraged that you called Olive Garden "Italian food."

edit -- yeah I know bashing Olive Garden is cliche. Doesn't make it less fun!

You don't ask for an itemized check at a restaurant that includes a breakdown of the ingredient cost, the labor for the chefs, and a "clean plate and silverware" fee that covers the dishwasher. You pay for the food and everything else should be accounted for that in the food's price.

This is true. But you do ask for an itemized list that includes every dish and drink offered, and people prefer it when that list is itemized by consumer. Most cities then include itemizations for things like taxes, alcohol fees (Chicago does this), hotel fees, etc. A service charge seems like it would fit here.

Regarding food size: I could not agree more, but food portion bloat has not and will not stop any time soon, even in the face of this obviously common sense.

Seth wrote:

I am enraged that you called Olive Garden "Italian food."

edit -- yeah I know bashing Olive Garden is cliche. Doesn't make it less fun!

I'll see your Olive Garden and raise you Fazoli's.

Seth wrote:

Regarding food size: I could not agree more, but food portion bloat has not and will not stop any time soon, even in the face of this obviously common sense.

This is only true of the segment of the restaurant trade that is competing on portion size because they can't differentiate themselves in other ways. That's clearly not applicable to the whole industry.

DanB wrote:
Seth wrote:

Regarding food size: I could not agree more, but food portion bloat has not and will not stop any time soon, even in the face of this obviously common sense.

This is only true of the segment of the restaurant trade that is competing on portion size because they can't differentiate themselves in other ways. That's clearly not applicable to the whole industry.

Also true -- but the industry that does not compete on food size doesn't even really need to have this conversation (edit -- or maybe they do...bear with my thought process here). The cheapest places I can think of that compete solely on food quality are places where the bottles of wine start at 75 dollars, the appetizers start at 15, and the entrees start at 35 -- and this is in the midwest, so add 20-40% to all of those numbers if you're on the coasts.

At that level, you're working with servers with crazy amounts of experience: people who have more or less made this their career (many of whom regularly bring in middle class incomes). You're looking at two or more servers plus a sommelier / cicerone to assist in your wine/beer pairings. You're also looking at clientele that would hopefully understand proper tipping etiquette.

And even after all that, you still have enough people tipping poorly that high end restaurants are changing the paradigm. Both of the places I highlighted in my OP are higher end restaurants -- a farm to table eatery in San Diego and a NYC sushi place that runs 24+ dollars a roll.

So if our best case scenario restaurants -- the sliver that doesn't worry about portion size and focuses on food quality -- are already attempting this experiment, it goes to reason that literally everywhere else -- from Morton's to Chili's and their locally owned competition -- might consider it as well.

Yeah I think we're saying the basically same thing -- when I say "portion bloat" I'm referring mostly to the fact that the 1/3 pound burger has virtually disappeared from menus and replaced with the half pounder -- and the quarter pound burger is even more rare. . . except when served as a double/triple stack.

I'm hoping that upward prices on beef will drive this trend away -- making corn more expensive and a new focus on farm to table dining, and more popularity among the pork and chicken meats should help.

But in this scenario I think I'm nitpicking. Overall your point is the stronger one.

Seth wrote:
DanB wrote:
Seth wrote:

Regarding food size: I could not agree more, but food portion bloat has not and will not stop any time soon, even in the face of this obviously common sense.

This is only true of the segment of the restaurant trade that is competing on portion size because they can't differentiate themselves in other ways. That's clearly not applicable to the whole industry.

Also true -- but the industry that does not compete on food size doesn't even really need to have this conversation (edit -- or maybe they do...bear with my thought process here). The cheapest places I can think of that compete solely on food quality are places where the bottles of wine start at 75 dollars, the appetizers start at 15, and the entrees start at 35 -- and this is in the midwest, so add 20-40% to all of those numbers if you're on the coasts.

Sure the fine dining end of the market is somewhat moot in this conversation but my experience of the US (and keep in mind my experience is only of major metropolitan centres) is that there are plenty of mid tier and affordable neighbourhood restaurants that are just doing their thing. And the really big fastfood chains have somewhat stable portion size; a big mac is a big mac.

It seems to me that it's really the cheap 'n' cheerful family restaurant chains that are really going head to head on portion size. I may be wrong but it looks like that market segment (and those trying to break in to it) that are really going wild on portion size (because big == great value)

Seth wrote:

But in this scenario I think I'm nitpicking.

We probably both are.

Swinging this back round on topic...

The kind of restaurant interested in presenting themselves as GREAT VALUE!!! Needs to keep it's overheads right down and sure won't be paying staff any more wages than they can get away with, which in turn facilitates/necessitates a culture of tipping.

It seems like the percentage system we (the US) have is unfair to servers at restaurants which have cheaper prices. I try to compensate by giving a minimum of $2 per person, but I'd much rather have the pay scale taken out of my hands.

Something that has me thinking. The BLS lumps all food service into one pool when gathering it's information. I struggle to find good data on service staff, that is gratuity dependent and how much they are making. How are those people paid the 2 bucks an hour doing?

As an example, Del Taco pays a pretty reasonable wage, 10 bucks an hour. A waitress at Denny's is getting paid 2.13 an hour in most states, but the BLS lumps them together. How much money is that 2.13 an hour Denny's Waitress doing?

I would be interested in those statistics. All I have is anecdata.

I think in our state, the server wage is 2.65, isn't it? I'm also suspicious if many business owners are actually fulfilling the law of paying servers the difference between server wage and minimum wage when their tips don't cover it.

Having a different minimum wage for anyone is discrimination.

One of those things that shocked me when I came to America was the statement on government workplace posters that "The federal minimum wage is $7.25", followed by the slightly smaller head, "The agricultural minimum wage is $4.25."