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The Tipping Point: Thoughts on Tips

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There is a lot of thought that goes into tipping.  Recently we had a family event for our daughter.  Part of this event was to take out our immediate family and grandparents for dinner.  It wasn’t a huge group.  My brother and his fiancée live out of province and were unable to make it.   Final tally was 13 plus a couple of babies.  The restaurant we picked was pretty good.  We decided to just have people order off the menu instead of doing a fixed priced thing.  Due to the size of the group we were advised that there would be a “service charge”.  This was 18% automatically added to the bill.  I’ve found this is pretty common practice in a lot of restaurants.  I don’t generally have an issue with tipping our server.  The process did get me thinking a bit about tipping etiquette.

What Is Tipping and Should I Do It?

A tip is generally money given to someone who has provided you with a service where you are already paying for the goods.  It can also be an extra bit of money for service even when you are already paying for service.  At a restaurant for example, you are paying for the food.  You are tipping for the service of having someone bring you that food.  Where tip-sharing is a policy, you may also be tipping for the service of preparing the food.  In some cases you may actually be tipping for a service you aren’t actually receiving.  An example of this may be a portion of your tip being shared with the bartender regardless of the lack of alcohol on your order.

There are some people who feel that a tip should be earned.  The basic service of taking orders and bringing the food is included in the meal cost.  For these people, the tip is only issued if the server goes above and beyond to make the night extra enjoyable.  Not only do I disagree with this way of thinking, but I have backup.  The wage setup is actually based on this being untrue (for Ontario anyway, not sure about other places).  In January 2018, Ontario raised its minimum wage (link).  The “general” minimum wage (18+) is $14/hr but liquor servers need only be paid $12.20/hr.  Liquor servers aren’t strictly bartenders – they are anyone that can serve alcohol including wait staff at a restaurant.  That is roughly a 15% gap between the 2.  According to this article the standard tip for “acceptable” service is 15%.  That is not a coincidence!

So if your server is paid less than the general minimum wage, you absolutely should tip in my opinion.

EXCEPTION: If your server is so exceptionally bad that it ruins your entire outing, there is an argument to not tip.  This is only if the issue is specifically with the server.  It cannot be due to other patrons, the chef nor the menu prices.  Since a lot of places practice tip-sharing – you are also punishing the entire service staff for the actions of one person.  In this case it may be more effective to speak with a manager.  Inform them about your dissatisfaction and have them resolve any issues.

Awkward Tip Request

A very large percentage of payments are being done through electronic payment terminals.  These are those fancy handheld machines that let you pay with plastic.  The point of sale software on these machines typically has a built-in “tip request”.  I’ve seen these in a couple of different formats.  The one I see most often is a choice between $ amount and %.  The other is preset percentages usually 12%, 15%, 18%, 20% and NO TIP.  I have no issue with this at a restaurant where I tip any way.  Where it gets really awkward is where you have that option at other places.  Places where you either would not tip, or where you are unsure of the tipping etiquette.  I had an example recently where this came up.


Recently I started (better) using the health benefits we get from Sarah’s work by getting a periodic massage.  Massage is certainly a service, but in this case it was for health reasons to deal with some back muscle issues.  The place I went to does not do direct billing for insurance so I had to pay and then submit the receipt for payback.  When I went to reception to pay I was confronted with the awkward tip request on the terminal.  I froze, paralyzed by what my move should be.  I had one massage in the past and there was no tip request then so I was unprepared.

In the matter of a few seconds I debated in my mind between just giving a tip or stopping the transaction to jump on my phone and check with my good friend Google.  I wanted to come back to this place – if I don’t tip and it was expected maybe I’d get worse service the next time.  If I do tip and it isn’t expected, I’ve essentially wasted money since insurance is not going to pay for a gratuity.  My dentist also does a good job, but I’ve never tipped him.

This machine also didn’t offer an option for a dollar amount, only percentages of 10%, 15%, 20%, 25% and that glaring NO TIP option.  In a relative panic, I chose 10%.  After being removed from the situation I realized that the same payment terminal was used for the non-medical services offered such as waxing, pedicures, etc.  That was probably the difference between the last place I had been, and this one.

What Percentage To Tip

While 15% might be the standard amount to tip – you need to pay attention to what number you are using to figure out the dollar amount.  Some places will give you the total (post-tax) of the bill which means you are tipping based on taxes as well as the service.  If the tip is being calculated on a post-tax total I will generally do 10%.  If it is pre-tax – 15%.  Not an exact match but with a 13% sales tax it works out to roughly the same amount.

As I mentioned before, in Ontario liquor servers are paid at a lower rate than other employees so a 15% tip is basically a minimum for them.  The 15% cannot be a standard across all avenues of tipping though.  Say you have a delivery person for an appliance package for your house.  Are you going to give 15% of your purchase to the driver – I doubt it, although I’m sure they’d appreciate it.

When going to a hotel there may be several different people to tip and doing 15% of your hotel stay will bankrupt you.  A few dollars to the valet if you use the service is a good start.  I almost always leave a tip for the housekeeping staff – not because I leave a mess but because I’ve seen some of the horrors they need to deal with and I’m happy to give a bit extra. If you are staying for a couple of nights it makes sense to leave a tip every day you are there.

A Change In Wages

In general I think it is unfair for servers to be paid less hourly wages than other employees – and I say this having never been a liquor server myself.  The onus to give the employee a fair wage gets shifted from the employer to the customer.  If servers were paid the same as everyone else, then tipping could be reserved for those who do go above and beyond.  In some places such as Germany, the “tip” is included in the menu price so tipping is not expected.  Like so many things, the European model is ahead of ours in this regard.

The tip can be an incentive to make your guests’ outing extra enjoyable.  For the server, they don’t have to worry that a particularly cheap customer is going to be the difference between paying the bills or not.  For the customer, they get better service since a tip would need to be earned instead of assumed.  I’m confident in some cases tips are not declared as income as they should be so the government would also enjoy an increase in tax revenue.  The effort and investment to make this sort of change may make it unrealistic – but I do think it would be a better way to do things.

What are your thoughts on tipping, and have you ever been confronted with the awkward tip request?


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