Tipping has gone too far…

Tipping has gone out of hand.

I was a server and a bartender. I’m not trying to take away your tips; in fact, if things get any worse, fewer people will go out to eat, restaurants will shut down, and no more tips ever. Slippery slope argument? Sure, but getting people on your side using your philosophy degree.

Economics of Tipping
Let’s start with the economics behind tipping. Tipping can be seen as a market mechanism that allows consumers to directly reward workers based on the perceived quality of service. In industries like hospitality and dining, tipping provides an incentive for workers to offer excellent service, as their income is partially dependent on customer satisfaction. Income varies depending on customer generosity, mood, and seasonality. This can lead to financial insecurity for workers, especially in low-income areas or during slow periods.

In many countries, such as the U.S., tipped workers can be paid less than the minimum wage, with tips expected to fill the gap. If the tips don’t cover the difference between the tip credit and the minimum wage, the owners have to pay it up to reach minimum wage. If minimum wage is $5 an hour and the employee gets a $2 tip, then the employer still has to pay the employee $3. In these cases, tips are subsidizing the employer because the employer’s labor costs went down since you’re directly paying for them. That’s weird—shouldn’t employers pay their employees?

The reality is that many servers make much more than minimum wage, especially in Canada, where we don’t really have that below-minimum-wage top-up system. When I worked as a server, I was getting paid higher than minimum wage, and people would still tip; in total, I was making around double the minimum wage hourly. The more attractive girls and bartenders were making significantly more than me—some were even hitting six figures. It’s a hard job, but there are definitely harder jobs out there. I was in my early 20s making as much as some middle-management office worker by just taking orders, being friendly, and exerting extra social pressure by chatting you up as soon as you had the POS machine in your hand.

Social Norms of Tipping
In the U.S. and Canada, tipping in restaurants is customary and expected to be from 15–25%. And there’s pressure to tip regardless of service. Apart from restaurants, you need to tip at the bar, coffee shop, taxi, haircuts, delivery, spa treatments, hotels—anywhere there’s a service being performed. But it’s not like that everywhere. In many parts of East Asia, tipping is not customary and is sometimes considered rude. Exceptional service is the norm, and workers do not need extra motivation to do their jobs well. In Korea, tipping can be insulting to somebody’s job—like you don’t think they make enough or that they only did a great job this time.

There may also be a cultural difference in what good service means. In Europe, for instance, great service means you get your orders fast, and your waiter seems to be invisible, yet you never have an empty glass or plate. In the U.S., great service means waiters pay attention to the table in the form of conversations, friendship, and smiles from their waiter (who actually resents them). There is a culture shock for some when they come to the U.S. and are greeted by an overly friendly, happy, zany waitress. Then they’re confused by having to pay an extra 20% on their bill to not be ostracized.

Social customs and norms are powerful. They’re the informal rules that govern behavior in societies. They’re the reason you don’t cut in line, interrupt others while they’re speaking, or generally act like a rude degenerate. But they are sensitive to culture and history, and they change all the time. We don’t expect women to raise the kids and men to bring home the paychecks anymore. Men don’t just wear suits, and women don’t just wear skirts. But we still have weird norms. We still have diamond rings to get engaged. We spend thousands to have a ritual to put dead people in the ground. And apparently, we pay an extra 20% for somebody to move a plate from one place to another with a smile.

Ethical and Social Implications
The tipping culture also raises ethical questions. Should the responsibility of paying workers fairly fall on the consumer, or should businesses be required to pay higher wages? The purpose of a business is to maximize profit, so paying higher wages to staff just means the food costs will go up and the customer will pay it anyway. The system of tipping just makes this distribution to the staff unequal.

Some argue that there’s some merit to this because the server with the best service will make the most money, and customers have more control by tipping the servers with the best service. But tipping is rarely based on service. It’s based on appearance, perceived wealth, or customer behavior. It’s biased, arbitrary, and can further harmful stereotypes. On the flip side, it creates an incentive for servers to prioritize those who look like higher-paying customers while ignoring others, further perpetuating stereotypes. There’s further ethically questionable gamification by servers to maximize tips, like flirting, telling fake personal anecdotes, or wearing revealing clothing. Are you really paying for truly good service? Or are you paying because you don’t want to look cheap?

The social pressure to tip is just that powerful. And expensive. And servers benefit from this norm. Even if all restaurants proposed paying a living wage, getting rid of tips, and equalizing the income for all servers, there would still be a large number of servers who would be against it. Why would a waitress making $900 in one shift switch to a model of getting paid $20 an hour? Selfishness and greed hurt others in this industry. The servers who are actually underpaid can’t rely on a steady paycheck because their income is largely dependent on the generosity or mood of customers. This can create financial instability and lead to disparities, especially for workers in lower-income areas or during off-peak seasons.

In recent years, there has been a growing movement toward eliminating tipping altogether. Several restaurants have adopted a no-tipping policy, opting instead to pay their workers a fair, livable wage. Has this impacted the quality of service? Resulted in higher menu prices? Do customers come for the service or the food?

Thanks for watching this video. Make sure you leave a tip. You know, unless you’re cheap and hate supporting hard workers. Just kidding. A 30% gratuity has already been added to your bill as a service charge.