Here’s a Tip, Don’t Tip Your Waiters

Diego Maguina Razuri, Contributing Writer

When many foreigners first receive their bill after eating at a New York City restaurant, two things will take them by surprise: the sky-high prices they have to pay for a simple entree and the few lines at the bottom suggesting tip amounts that were provided for convenience. This is the disguise of a social norm in the United States that implies if you do not tip, you will be perceived as a rude, cheap and heartless customer. However, this expectation should be ignored.

The main argument in favor of tipping is that, without tips, the waiters will receive only their basic salary, which is too low. But is that really the customer’s problem? In an economy with a relatively free market, why should customers bother to accommodate their servers? That should be the employer’s problem. As a matter of fact, this is how most industries work. We tip waiters, but we do not tip sales associates or delivery men. These occupations also revolve around providing customers with a product.  Furthermore, why do we tip waiters, when we do not tip the chefs who also took part in providing the service?

When we tip, we are actually creating the perfect incentive for employers to pay a low wage. U.S. labor laws state that an employer of a tipped employee must pay at least $2.13 per hour. If such amount and the employee’s gratuities do not add up to the federal minimum wage — which is currently $7.25 per hour — the employer must compensate the difference. However, this does not necessarily occur in reality, and the waiter ends up with a lower return for his work than what the law mandates.  The unfortunate result is that waiters are more likely than other workers to fall into poverty.

Some may argue that waiters are paid according to their performance and, therefore, have the incentive to do a better job. However, this is another myth. A Cornell University study shows that service quality does not seem to be associated with the size of the tip. Determinant factors were customer’s sex, group size and the individual bill amount. This means that, contrary to popular belief, the better service a waiter provides does not mean he will get a higher tip. Furthermore, another study conducted by a team of Cornell University and Mississippi College professors demonstrated that there is racial discrimination in tipping, as black waiters get significantly lower gratuities than their white peers, regardless of the customer’s race. Under a fairer, non-tipped employee job regime, they would receive the same wage.

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Tipping is not as bad as it seems — it is worse. Tipping culture indirectly fosters poverty and discrimination at the expense of employees who are not necessarily rewarded according to the service they provided. If politicians do not want to change the labor law, it is up to us, the customers, to generate adequate incentives for them to do it.

 

Opinions expressed on the editorial pages are not necessarily those of WSN, and our publication of opinions is not an endorsement of them.

A version of this appeared in the Tuesday, Feb. 20 print edition. Email Diego Maguina Razuri at [email protected].

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21 COMMENTS

  1. you realise that if the employer paid their wait staff a living wage that yer food would cost more, right? so i you can’t afford to tip you really can’t afford to eat out. you can’t demand a service and then refuse to pay for it. when you get yer car fixed there’s a line on the bill that says “labor”. that’s yer “tip” for that service. if you go out to eat and don’t tip yer basically saying “i expect someone to bring me my food for free”. don’t like tipping? think it’s stupid? then eat at home.

    • Prices also have this thing called profit attached to them. You can adjust profit in your example, that would modify the price as well. Having little choice but to pay 15% – 20% tip on a bill is already a higher cost. That’s the whole rant here, the added cost. You are saying well, if you don’t pay a tip, then the servers wage will need to be higher, that’s just moving the cost around but stop there. A restaurant’s business and revenue model is thought out long before the first guest is served a dish. Just the fact that you need to make an adjustment in the way they make money to justify any point should spark the idea that something isn’t right. You are right about choosing to tip or eating at home, simple but true. The point is, that you can’t say that of buying a game at best buy or restaurants in other countries or fast food for that matter. A tip is socially hot wired and unique to restaurants like no other. Analyze the business model more accurately and you shouldn’t be surprised who is being a stealthy greedy cheapskate and the person paying the most and already overpaying, finishes the meal in the decisive spotlight of morality.

  2. I get where you’re coming from but the ball is in the servers court to organize and demand higher wages. The truth is many servers don’t want a higher base wage because they can make far more per hour in tips than what even a very generous employer might offer. If you want to advocate on their behalf consider ways to get them organized instead of stiffing the waitstaff in some asenine attempt to show the owners of the establishment who’s right. The only thing you’re doing is saving yourself a few bucks. If you can’t afford to tip, don’t go out to eat.

  3. Some valid points were made in this article regarding the potential discriminatory practices inherent in tipping or the issues around how it’s only applied to waiters and bartenders. However, should you expect an employer to pay waiters and bartenders, you should also anticipate a 18%-20% rise in prices. Therefore, customers would end up paying the same, but now in contrast they would complain about the outrageous prices of menu items. You cant expect an employer to magically find the money for waiters and bartenders without it affecting your bill. And stiffing honest, hard working folk in order to challenge the state of things is not revolution – it’s assholeness. Find a better and sensical approach.

  4. You realize if restaurant owners paid their employees a full minimum wage, the “sky high prices” you’re already complaining about would be about 25% higher, right?

    Restaurant profit margins are typically very thin.. which is why so many fail. The tip credit is a great incentive that allows restaurants to stay afloat. It’s worked fantastically for decades. If you don’t want to tip that’s entirely your choice, as servers are compensated at least minimum wage either way, and the generosity of strangers vastly outweighs the minority in America who share your view.

  5. This opinion piece displays a complete ignorance of the economics of the tipping model.

    >The main argument in favor of tipping is that, without tips, the waiters will receive only their basic salary, which is too low. But is that really the customer’s problem?

    100% of the costs to run a business are the customers problem. You know what you call a business where the customers don’t pay 100% of the costs of operation? Closed.

    The tipping model actually saves you money.

  6. This is a fantastic example of “good thought, wrong solution”. The idea that withholding tips which amount to a majority of FOH workers money will somehow inspire employers to pay a higher wage is ludicrous, as you would essentially destroy an entire industry in the name of idealistic principles that 1. Have nothing to do with the people you’re screwing and 2. Should probably have been questioned and worked out in your high school writing class. Take up your issues with the people who are actually making the policy, not the people who figured out how to play the game. Not sure how this made it past an editor due to the insane level of ignorance. Maybe it didn’t.

  7. Wow the level of ignorance in this article. I’m 99%. Sure you wrote all this with the intention. To create outrage and attract readers… If that’s the case Bravo if you really believe what you wrote you are Beyond stupid and wsn needs to Brea all affiliation

    • Lol at all of the entitlement in the comments attacking the author here. You servers want to make more money? Learn some skills and find a better fucking job like the rest of us.

  8. Thanks for justifying your decision to avoid giving money to people who provide you with a service that is partially paid for by others’ decision to give money to those people. You are reaping the benefits others are paying for you, to make up for the fact that you refuse to.

  9. I’m a bartender and I agree that tipping is a broken system. If we did agree one day to abolish tipping, then prices would increase to reflect the pay that bartenders and servers are earning in tips now. Prices wouldn’t stay static, they would go up about 20-25% at the minimum to reflect the increased wage costs to the owner.

    The idea of the Bently driving bar owner is largely false. Yes you can earn a decent amount as the owner of a bar or restaurant, but the failure rate is high. Far more restaurant owners lose their homes than buy a yacht.

    Your suggestion may as well be ‘hey everyone, you don’t HAVE TO give money to stripper! Just go and spend nothing, you’ll fix the system in no time!’ If it builds up to that point then the industry will have a huge correction, very quickly.

    On a final note, if you strongly believe in your ‘no tipping’ policy enough, then you should be proud enough of it at the beginning of the meal to explain it to your server before you order your food and drinks, rather than smugly leaving at the end after having fixed a billion dollar market.

  10. Your article demonstrates an overwhelming lack of knowledge about the industry. You know the saying, “write what you know”, well you clearly don’t know anything about the restaurant industry—so don’t write about it.

  11. As someone who has studied economics and worked in the service industry, I’ve got to tell you that there’s no easy solution here. Perhaps you are correct that service quality is not correlated with tip amount, but then why should it be, it’s not as if the server knows ahead of time how much a given customer will tip them. What I can say, with a near certainty is that service quality would decline if there were no prospect of a tip at all (and I have heard anecdotal evidence from travelers in Europe to support that assumption). Moreover, eliminating tipping and forcing employers to pay a living wage to service personal, while seemingly ideal, will nevertheless result in disemployment as many businesses will go under and fewer will be able to open. That, and, a significant portion of the wage increase will be passed on to consumers in the form of higher menu prices. The problem is that even in the best cases, the restaurant industry operates on remarkably slim profit margins (5% is a good year), and labor expense accounts for nearly a third of overhead. More than doubling that, as you propose, would likely cripple the industry for a long time. So until you have a complete path to solving this economic.ic conundrum, maybe you should stop being cheap and just tip your servers.

  12. It looks like that most of the negative comments came from the people who never traveled anywhere outside the US and because of that they didn’t have a chance to realize that tipping should be optional, not forced, and it should depend on the quality of service you receive (because that’s the way across the globe and the restaurant industry even in poor countries are not destroyed). Why should I tip for the bad food, rude waiter or any other negative aspect that restaurant (read the owner) is responsible for, and because of the imposed guilt, we feel that we must tip the waiter only because he/she is a human. The most important thing is the fact that author of the article said, employers should properly pay their employees (because they are humans!), to respect what law mandates and not to exploit them, and not to deceive the costumers by displaying the wrong prices, because you’ll end up paying much more. The whole system of “suggested” tip is wrong, and those of you who have called the author of the article insensitive, cheap or monster should think twice and maybe realize that fault lies in a country which allowed this.

  13. Wow ! this makes my blood boil. Unless you are in a sphere to create a larger policy change this shouldn’t even be a discussion. Servers, like myself, rely on tips to pay rent and put food on the table. Your “protest” will only negatively impact the server and the people they tip out. In a restaurant, when you tip, the server is not the only person you’re paying. Servers tip out their bartenders, back-waiters, runners, bussers, etc. At the end of the night, 30% of my tips go to those people. The percentage varies restaurant to restaurant, but the practice is the same. These people rely on the money I make from my tips as well, but also get paid a higher wage than me for doing a lot of my behind the scenes work, which is why I never get mad that I have to tip out, I know they made my job 10x easier. Also, in favor of the tipping model, this allows for a certain level of employment advancement, similar to a promotion in a normal corporate business model. If you start working at a cheap diner in high school, when you move to college you can apply to a nicer restaurant with higher food and beverage prices, which will in turn get you higher tips, and after that you can work at an even NICER place, etc. etc. Servers have to field a variety of questions, concerns, life threatening allergies, and nice to borderline cruel personalities table to table all at the same time, while trying to communicate what they need to the back of the house staff (who in some restaurants can be uncommunicative and unhelpful because the wages of chefs and managers do NOT rely on the happiness of the customer) and fix any problems that may arise. It is my firm belief that a server should at least a 20% tip if they got your food to you in a timely manner, helped answer your questions to the best of their ability, were generally pleasant, and fixed any problems that arose over the course of your visit to the restaurant. A tip should definitely be higher if you connected with them and they went above in beyond in their kindness and service, ESPECIALLY if the restaurant is crowded and busy and they still took the time to make sure you had an amazing experience. As an example of the true highs and lows of tipping I will provide an example. On New Years Day this year I was fielding a full section with many tables during a brunch at the very popular brunch spot I worked at. Because it was New Years and I provided such great service during an absolutely INSANE shift a nice man tipped me $50 on a $50 check and told me to have a Happy New Year. I literally had to take a second to go to the bathroom and cry at how generous he was and how much he turned around my hellish shift. After I came back from the bathroom, I cashed out the next table over from him, a table of tourists, and they tipped me $2 on a $75 check. They had gotten the same level of service as the man next to them, but could’ve devastated me when it came to tip out that day. Luckily the generous man evened them out so my tips that day were average for what they normally were, but if it hadn’t been for that man I easily could’ve gone home with no money for my trouble. ANYWAY this is an INCREDIBLY long winded way to say please tip your servers and this article is an absolute dumpster fire

  14. If you hate tipping and believe servers should not make a living wage which is what this article a VERY heavily implies, sure, never tip, but NEVER go out to eat again. I think you should be banned from every restraunt in the United States because you’re an awful person. You obviously support slavery because you believe people who serve you should be forced to be homeless. I’m 99.99999999% you’re a republican and likely against handouts and welfare. Well, win you tell everyone not to tip because it’s not your problem, servers are going to need programs you’re probably against. The fact that you know they get paid very little and STILL think people shouldn’t tip alone proves you’re a pathetic excuse for a human. In fact, I think you should be paid $3 an hour, though you probably make millions and simply don’t care about others because you’re nothing but a selfish, greedy psychopath who think everyone else should suffer. I hope you get into a terrible accident and die! I hate rich people, and you’re literally the main reason! I bet you support tax cuts for the rich and don’t actually care about the economy, you just want poor people to die! Screw you!

  15. I never tip by law it’s not illegal to tip that’s why I do not tip greedy servers did you know it was not customary for a server to be tipped it all started when a man brought in his mistress in london that is how tipping started it’s his his money and those of you who say we need to tipp to hell with you it’s not the damn law and for those of you who are arresting people over this bullcrap they will sue your ass so hard and shut you down tipping is not a law its called a gratuity fee for a reason boo hoo you busted ur ass off who the hell cares get a real job one that doesn’t pay minimum wage and for the restaurants who are encouraging this u will get sued for forcing people to pay a gratuity fee so fuck off I hate waiters cause they suck at service and two they never ask twice to refill drinks three they’re self entitled assholes who need to find a real job I will never eat at a restaurant due to this horseshit I could care less if u disagree with em or agree I will never fucking tip a server It’s my right…..

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