A Rant About How Tipping Has Gotten Out Of Control

SynchronySavingsSingleWidget728x90

I’m in a feisty mood today. If you don’t want to hear a rant, please come back in a couple days when our next post is live. Otherwise, sit back and grab a bowl of popcorn and let me know how you feel about my rant in the comments at the end. I know you either think I’m right or wrong, and I want to hear your side too. On to the rant!

outrageous tippingTipping. Everyone has their own opinions about the practice. You normally don’t hear much arguing about it unless you’ve come across someone who believes that tipping should be optional (it isn’t and shouldn’t) or you think you should tip insane amounts to everyone and their mom.

So, what set me off about tipping? The other night I was at one of our favorite restaurants. It isn’t the cheapest place, but it’s on the beach so we expect to pay a bit more than a typical chain restaurant, but that’s OK. The shock came when we got our bill.

Restaurants Suggest Tipping Amounts

I’m sure you’ve caught on to the recent trend of restaurants printing suggested tips on the receipts. Generally they calculate how much your tip should be if you want to tip 15%, 18% of 20%. I think that’s fair, because that’s the range I normally tip in.

In my mind, I feel I should tip 15% if service is average, 18% if service is great and 20% if I didn’t have to think or ask about anything, such as needing a refill because my glass was empty. 15% for just doing the basics of your job seems pretty fair to me. After all, I’ve been a server before and know that some people tip even less than that!

Not All Suggested Tips Are Equal

This time we got our bill and saw three suggested tip amounts at the bottom, but something didn’t look right. The tips were called Good, Great and Excellent, which is in line with my normal tipping practices. However, they didn’t list the percentages associated with each category and that fact had me suspicious almost immediately.

I took out my phone and did some quick calculations and found out that Good was 18%, Great was 20% and Excellent was 22%. Who tips 22%? And why does this restaurant feel I need to tip 22%, not the standard 20%, for great service?

Before we get into the argument, let’s first discuss what I actually tipped. Needless to say, I didn’t tip 22%.  In fact, the service wasn’t that great either. It was decent, I’d call it OK, not even good. But, just so everyone doesn’t think I’m cheap and stiffed the guy, I tipped the server just a tiny bit less than 18% because it was a nice even round number. Now, let’s get to the fun part.

Why Do Servers Feel These Deserve Higher Percentages Now?

News flash. As waitstaff, you aren’t entitled to a tip if you don’t do a good job. It is part of your pay, but it is part of your pay for doing your job and doing it at least halfway decently. It is an incentive and you need to work for it.

I have no problem tipping the standard 15 to 20% for service that isn’t awful. In fact, I’ve only stiffed servers two or three times in my life and the stories from those encounters would shock most people. The problem is, servers these days keep thinking they need a larger and larger tip. 20% isn’t a great tip anymore it seems. In fact, I’ve heard servers complain if they don’t receive at least 20% for their tip. That’s absurd.

Why do servers think they deserve tips in excess of 20%? They say that things are getting more expensive and they need to make more money. Unfortunately, most servers aren’t smart enough to realize that as things get more expensive, the meals at their restaurants also get more expensive so they ARE already getting a bigger tip. After all, 20% of $20 is more than 20% of $10. Shocker, I know.

Tips For Servers That Want To Make More Money

I have a tip for servers who want to make more money in tips. Instead of continuing to work at the restaurant you’ve been working at for years, go out and get a better job that pays more. Do you genuinely like serving? That’s great! Keep with it, just find a way to increase the amount of your tables’ checks by selling them more food. That way, your 20% will be worth even more!

Want to know an even bigger secret that will make you more money? Instead of working at Applebee’s for the foreseeable future, try your best to increase your serving skills. Once you’re an excellent server, go get a job at a nicer, more expensive restaurant. The bills will be larger there and your tips will be too!

So, what’s your take on tipping? Do you think we should be tipping more than 20% on a regular basis these days? Has tipping gotten out of control? Or am I just cheap? Let me know down in the comments!

Picture by: ashafsk Text added by: Lance Cothern

Like What You See?

Join the other readers who have signed up for our email newsletter! No spam, just periodic updates to help improve your finances!

About Lance Cothern

Lance Cothern, a Certified Public Accountant (CPA) licensed in the Commonwealth of Virginia, is the founder of Money Manifesto. You can read more about him here or connect with him on Facebook, Twitter, Google+ or Pinterest.

Comments

  1. BarbChicagoTeacher says:

    I was at Disney’s Bona at the Anime Kingdom. They had suggested tips for 15%, 18%, and 20% after the total check that included tax. We tip on pre-tax. Better yet, the restaurant is a buffet so all the server does is take your plates and bring you drinks. I want that job bc the buffet is $40+ per person. I am never going back after getting the receipt.

  2. I like the last bit that waiting staff should try to make you welcoming and sell more so that they can get a good percentage out of overall bill. When I was younger I was working in one of those tourist towns. The restaurant owner had plenty students like me to choose from and he would only pay you 20% of the total bill (regardless of how much tips you received) and no hourly pay. His moto was simple; sell more if you want to earn more.

    I don’t know how legal was his practices because I believe you should pay an hourly wage and let the waiting staff earn their tips. I think this is a subject for another discussion.

  3. I’ve run into a problem when tipping using a debit machine and a gift card. The server took the $100 gift card amount off first, and then hand over the debit machine to pay off the balance ($15). The problem is, I chose to use the % tip amount, and therefore unintentionally only tipped her 18% of $15 – not the full $115. So instead of getting a $20 tip, she only got $2.70 (which is a 2.35% tip!). At no point during my transaction was a $ amount shown, so I didn’t catch the mistake until I got home. I immediately attempted to contact the restaurant because I was embarrassed and felt bad, but they never got back to me… The service wasn’t great but it wasn’t *that* bad!

  4. I’d say my tipping calculations are right in line with yours. On occasion I’ll go higher for someone who went above and beyond. Especially on days like Thanksgiving or Christmas, just to be generous to those who are sacrificing their holiday time so I can enjoy mine.

  5. I don’t mind tipping, but I don’t feel like servers are entitled to anything more than the standard 15%. I always tip at least 15%, usually more.

  6. I go with the 15/18/20 rule of thumb in most cases. I think that’s more than fair.

  7. My problem is not for restaurants, but everywhere else where they place a tip jar. I don’t mind tipping for good service, but taking my order at a fast food restaurant (just one example) doesn’t deserve a tip. They don’t get restaurant wage where tips are part of their salary. I’m not cheap, but it seems everyone is putting up a tip jar and expecting a tip for things that never received tips before.

    • That’s a rant for another day :)

    • Amen. If you don’t want to work for the salary offered – don’t! Don’t expect me to fork out because you “HAVE” to serve me — is that not your job. Charge me a proper price for the meal and don’t expect me to pay your employees too. I never received a tip working the help desk troubleshooting computer issues for my company. I got paid my agreed upon wage – end of story – fellow employees did not subsidize me.

  8. Tax/No Tax says:

    I usually tip 20%, but I do it on pre-tax, which I find in my area, I find is roughly the same as 15% with tax. I just see no reason to tip on an extra ~7% added by the government. Curious as to your thoughts – Pre Tax or Total Bill?

  9. I’d say my tipping calculations are right in line with yours. On occasion I’ll go higher for someone who went above and beyond. Especially on days like Thanksgiving or Christmas, just to be generous to those who are sacrificing their holiday time so I can enjoy mine.

    WHAT! They do not HAVE to work on those days. They CHOSE to. And they are getting paid (probably extra) for working those days. And they know that they will probably be tipped extra because of the occasion also. And by the way in Australia there is no tipping.

    • In the US a lot of servers aren’t paid extra if they have to work those days. I can’t say I’m surprised how different other cultures are. I kind of wish the US adopted some of the practices in other countries.

  10. The entire system of tipping is out of control. It’s silly that this is put in the hands of customers

  11. I tip similar to you, and have friends that are servers so I’ve heard their stories. Waiting tables is not easy, and I appreciate servers that do a good job. However, I think anything over 20% is ridiculous unless you’re a wealthy person, most of us can’t afford that or else we would never be able to eat at restaurants! Percentage goes up with inflation, plain and simple. And for a mediocre server to expect me to give them extra cash that would pay for a whole other meal for myself, just because they plunked a plate in front of me, is absurd. A 15% gratuity, smile and a ‘thank you’ should be enough, why is this not even appreciated anymore? We don’t tip therapists, graphic designers, bookstore workers or a variety of other customer service-based jobs where the worker goes above and beyond to help us, as well. Our system really makes no sense. (Wish I lived in Australia!)

  12. I tip 10 percent for decent service and 15 for excellent service. Zero for bad. I don’t feel bad for it because here in Canada, servers are getting $10 an hour minimum wage. A friend of mine who works in the restaurant business says that servers at his chain restaurant are pulling in around 200 a night with tips. Not bad when you consider they’re 22 years old with a high school education.
    I will tip more for lunch when the prices are discounted.
    What drives me up the wall is when i’m picking up something to go at subway or a food court and the debit machine has a tip function. I never tip there but that is a clear indicator that tipping is out of controll.

    • I don’t ever tip at places like Subway or food courts either. They’re paid at least minimum wage and they aren’t doing anything outside of their job description.

  13. While on vacation a few nights ago in Panama City Beach, FL our family of 6 ate a Angelo’s Steak House where we experienced inflated tip suggestions on the bill. The tip amounts ranged from 17% to 22%. I understand the restaurant is entitled to print whatever suggested tip amounts they feel appropriate for their servers. The thing that really irked me was that beside the 17% in parentheses was the word “fair”. Seriously? 17% is just fair? Our total bill was around $120, which at this “fair” tip rate equates out to around a $20 tip. I’ve waited tables before so I’m thinking the wait staff can easily pick up 12 tables in a shift. Do the math on that…$240 in “fair” tips per shift. That’s pretty damn “fair” in my opinion. Actually that’s about what I make per day with a college degree and 10 years into my career! I am a firm believer in good tipping, but you shouldn’t be able to get rich by waiting tables!!!

    • I live really close to Panama City Beach, but I’ve never been to Angelo’s. In fact, the occurence that caused this article was in Panama City Beach, too! Except the restaurant was on the beach. I’m beginning to think this is a Panama City Beach thing. A lot of our industry relies on tourism and maybe the owners/servers think they can con tourists out of their money. So not cool.

  14. Bojan - Alpha Efficiency says:

    If I don’t feel like I got a decent service, and especially if I felt negative energy from the waiter, I don’t tip at all. Call me cheap, but tipping is a reward for the pleasure you’ve provided me. If you provided me with negative energy, I don’t want to give you none of mine.

    Cool waiters now how to play on emotions, how to make you feel good, and you genuienly tip them handsomely. They understand the value of making others feel good. You’re not paying for the service, you’re paying for the emotion.

    I leave tips based on how waiter made me feel. So it’s ultimately up to them.

  15. As a server in a fairly nice restaurant, allow me to interject a bit of “perspective” into the mix. First of all, we appreciate your kindness in tipping. It is a blessing to receive any amount of money over and above our paychecks. I consider myself a professional when it comes to being a server. I am certainly not the best, but I take my job seriously, which means I do the best that I can and try to be attentive to my customers. But there seem to be some misconceptions or some general “haven’t thought about that” ideas floating about. I’ll list some:
    1. The tips received are taxed from our paychecks – so those checks tend to be almost nothing after the declared tips are taxed. There is no longer much chance of cheating on declaring tips due to the POS systems. Not that I would do that. Also we are required to tip out the hostess, kitchen, bartender, and bussers. Remember that my portion of the 20% is dwindling rapidly. But I still pay taxes based upon all of the tips I receive before tip out.
    2. While reading some of these responses to the article, I instinctively get a feel for what kind of customer you might be. People in general have become restaurant critics. Nothing is good enough. Your generous 20% tip is probably offset by a number of people who decide that 10% or less is sufficient or nothing at all.
    3. While I love what I do, in a 6 to 8 hour shift I never or rarely have time to take a break because I am constantly serving my customers. This also means that I am walking for 6 to 8 hour straight. My legs are killing me by the end of a shift. Try going for an 8 hour walk sometime.
    4. One comment on holidays like Christmas or Easter – If the restaurant is open on that day, that server probably has no choice in whether they get to have it off or not. These are usually the busiest days of the year and they want all hands on deck. These days are killer – you are not celebrating with your family and you are serving people who don’t always show much gratitude for you “doing your job”.
    5. Many people are abusive to servers. Everything is the server’s fault. If the meat is not cooked right (something I cannot see or have any control of when I bring it out to you) it affects my tip. If it doesn’t come out as quickly as you would like (again no control) it affects my tip. If the manager won’t comp your (entire) meal because you are not happy, if affects my tip. Get the picture? Most things in a restaurant are out of my control.

    So watch the server. Weigh your tip based on some of these things – How busy is it? Did they come to the table a few times to check on you? Were they courteous? How many times did all of you at the table ask them to get you something that was out of the norm – Ranch dressing to dip your fries in, new napkins, replace dropped fork? How many times did you need your water filled – once or twice ok – 6 or 7 a bit much – ask for a pitcher if you’re that thirsty? Don’t base your tip on the quality of food or timeliness of the order. Tip them on what THEY did, not the kitchen or the bar or the manager. Overall, serving is a great job and I always tip at least 20% when I eat out because I know what the server is going through, and I appreciate a good server when I get one and want them to know it.

    • Eric, thanks for your detailed comment. It’s good to get the perspective of a server in the conversation with such detail.

    • Eric,

      Thank you for your perspective. Of course there are great servers out there, but also there are mediocre and outright horrible servers.

      While I agree with some of your points of view, let me address the following.

      Unfortunately, in this day of the internet, yes, almost everyone has become a restaurant critic. Therefore, shouldn’t the service industry try offer the best service possible? Everyone’s standards are different, so even if one customer had left a 20% tip, another customer may leave a 10% tip because they perceived that the service received was lacking.

      While having an 8 hour shift on your feet is definitely hard work, does that mean that towards the end of the shift, the customer should receive bad service but still tip 20%? There are laborers out there that perform back breaking work 8 or more hours per day, so should their quality of workmanship decrease?

      While I have seen customers being abusive to servers, I also have seen plenty of apathetic, arrogant servers belittle and abuse customers as well. If the meat is not cooked right, then of course it’s not the servers’ fault, but if the meal doesn’t arrive on time because the servers were busy gossiping with each other and letting the food go cold, then it definitely is the servers’ fault. (I have seen this on numerous occasions)
      Unfortunately, the servers are the front line/face of the restaurant, since they are the ones to have the most contact with the customers, therefore the servers will unfairly receive most of the complaints. But in my experience, a great server can counteract most of the problems from the kitchen to management, just by offering such kind, friendly service, that the customer will feel too guilty to complain one bit. In one occasion, the server was so helpful and kind that I felt sorry for asking to refill my water, I wanted to get up and serve myself!

      I make sure to reward those dedicated servers that make a simple meal, into an amazing event. But for those servers that don’t provide any service at all, then I make sure to let them know with the lack of a tip.

  16. A girl in England. says:

    Coming to this from the UK, where the minimum wage is set for ALL industries (unless self employed).
    The culture here is mixed. Tips are generally for servers/waiters as you’d expect, some takeaways have a tip bowl (usually the change only is put in), but hairdressers some people tip. Which seems odd to me when paying £30+ for a wash, cut and blowdry. They set the prices (or the owners do), if it doesn’t cover it, raise them. I mind less as the local one thats about £12 for a basic cut, especially as they often do a better job.

    I don’t tip regularly, as I don’t see why some should get it, but shop workers not. If service is good (pubs or chain restaurant/pubs usually) I’ll leave a small amount. I don’t expect miracles, but the main waitress we seem to get at lunchtime at one is really slow despite it being quiet, I don’t really tip her, maybe change. Maybe 5-10%. Other places/times, again, the change.

    All that said, I eat at cheapish establishments because that’s my budget, tips are more expected at fine dining even here (a friend used to them expects me to tip a slow waitress 10%… nope), if I was better off I’d love to sometimes leave someone who has given good service a noticeable tip. But that’s because, when I’ve had those people, I’ve noticed their service to be fantastic.

    The situation in America is awful, everyone should have the right to be paid basic wage by the employer. Maybe prices would increase a bit, but I think everyone would benefit. We still manage to have places doing a £10 meal deal for 2/3 courses and unlimited drinks with it here.

Share Your Thoughts

*