Tips Unwelcome: Why Tipping Should be Eliminated

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The other day, I called my cell phone provider to change my service. The representative on the other end of the line was friendly and professional. My transaction was handled in an efficient manner. At the end of the call, a Siri-like computer voice came on and said, “Press 1 to leave a 10% tip, press 2 to leave 15% tip, press 3 to leave a 20% tip…”

Outraged? Of course. Why should I be guilted into paying extra just to get decent service? Doesn’t the company pay its employees enough to compensate them?

Truth is, this never happened. I made it up to illustrate how tipping is an illogical compensation practice that should be abolished. Every day, across the United States, servers at restaurants rely on tips for the majority of their income. Yet the same thing occurs every day in restaurants across the country. As consumers, we are expected to ensure good service.

Proponents claim that tipping leads to better service. After all, they say, if servers are not relying on tips, what incentive would they have to give good service?

What these proponents neglect to notice is that people in jobs give great service every day, without ever receiving a tip. Why? Because it’s their job. It’s a basic expectation, and if it isn’t happening, they’ll be shown the door. Same with servers.

I had one person tell me that when he went to Europe, where tipping is only given for exceptional service, he found the service to be slow. He took this to mean that tips made a difference. What he failed to understand is that what he took as slow service was often the restaurant’s desire to allow diners to enjoy a leisurely dinner. In most of Europe, meals are seen as something to be enjoyed and savored, a chance to converse with friends and colleagues. There isn’t the rush like there is in America, where the goal is to get in and out as quickly as possible, while the restaurant owners want to maximize profits by turning tables as quickly as possible. It isn’t about tipping, it’s about culture.

Tipping is also a highly unreliable method of compensation. No one can agree on what an acceptable tip is for good or great service. Some say 15%, some 20%, some 25% percent. Studies have also found that people leave bigger or smaller tips for arbitrary reasons, regardless of service quality. Factors include gender, race, ethnicity, whether a server repeats the order back to you, and even whether or not the server wears a barrette. None of these factors lead to the pay for performance that tipping is supposed to promote.

Tipping isn’t just inefficient, it’s bad for servers. According to the Wall Street Journal, 15% of restaurant service live below the poverty line. For every story you hear about a server getting a $1000 tip, there are ten instances in which a server gets stiffed.

A friend of mine once treated me to dinner. Nice of him, given that the bill was about $100. I was horrified, however, when he left a $10 bill on the table. I quickly offered to pick up the tip, allowing me to up the amount while letting him save face.

So why do we tip? No one is exactly sure, but it appears to go back to the fact that European aristocracy used to throw a few coins to their servants. Visiting Americans witnessed this and brought the practice back to the states. At first, many derided the practice as un-American and un-Democratic. The wealthy throwing a pittance to the poor lowly working class. Nevertheless, the practice caught on, until we are left with the system we have today.

Most restaurants continue the practice because it is the only way they know to do business. As out-dated and ineffective as it might be, they know how to run a restaurant that tips and they understand what the outcomes are. If they change, it means they will have to change their practices, and they have no idea what the repercussions might be.

Some restaurants have already made the change. And guess what, sales and service have only increased. Servers, most of whom are now paid a good wage with benefits and scheduled full-time, see themselves as part of a team, as people with not just a job, but a profession. In addition, despite the prices in these restaurants being higher, patrons tend to buy more. I can get that appetizer or extra drink, they say, because I don’t have to add 20 percent on to the bill at the end.

Unfortunately, these restaurants are few and far between. In the meantime, the practice is here to say. If we can’t beat them, maybe we should join them.

Tomorrow, a tip jar goes on my desk.

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