The other one I'm seeing lately is a semi-stealth "service charge" on the bill. Something like 18% to 20% added to the bill without really standing out. This used to be something they'd do for "larger parties", but now I'm seeing it even when I'm eating solo.
This makes for an uncomfortable situation where I now have to ask the waiter or bartender if they receive this as a tip. Then I need to decide if I want to tip something like 5% to 7% extra, which would be a good 25% tip in total, but looks like a crappy 5% tip.
So after dealing with that, I just don't go back to those pubs or restaurants.
There was one bar where the waitress told me she doesn't get that service charge. It just goes to the house. So if she was telling the truth, all of the prices on the menu are just a lie.
>This makes for an uncomfortable situation where I now have to ask the waiter or bartender if they receive this as a tip.
I don't even ask. If it looks like a tip and is computed like a tip, it is one. How the owners and workers hash out their payment structure is none of my business as a customer.
I spoke with a restaurant owner who explained to me the purpose of the "service fees" that may look like tips, but don't actually go to the waiters. The reason they do that is that some restaurants want to pay their non-wait staff more, without also needing to increase the pay for their wait staff. Since the "service fees" aren't included when calculating the tips, this allows restaurants to direct those extra funds exactly where they need without unnecessarily inflating the overall cost of the meal.
I 100% agree that tips should be abolished and consumers should pay a clear and fixed price for goods and services, but if you accept that that is not an option, then "service fees" actually make sense. That being said, I can understand the ire that they may cause the wait staff, since many consumers may think those "service fees" are tips, and as a result, may not receive anything for their work. No great solutions here
If I'm tipping, my intention is that the money goes to the workers, not the establishment -- so it is my business as a customer. A tip is a gift, and I want to know that the gift is going to who I intend for it to go to.
I think the "gift" idea breaks down in practice when tips have become common and expected, instead of rare and meaningful. It leads to moral hazard where the establishment rationally gives up its responsibility of paying its hired staff.
"Tips as gifts" does work in situations where there is no establishment. For example, musicians on the street with a tip jar.
I don't get why the US doesn't have basic consumer protections, like products and services must be advertised at their total cost to consumer. Why not have supermarket prices marked with sales tax included? Why allow companies to advertise one price and charge another? Why is this not a voter issue?
Because consumer protections would be heavy-handed government intervention that might prevent the invisible hand of the free market from being able to innovate whether it's more efficient to pick your left pocket or your right pocket.
Though that never ending fountain of new money being handed out to banks and other centralized entities to create an inflation treadmill that destroys people's ability to interact with the market in a deliberate manner (eg investigating how a restaurant handles tips before going there, or spending time choosing a different restaurant if the first one is not transparent). That treadmill is definitely not to be considered government meddling, somehow.
Because the US does not have a particularly powerful federal government and these sorts of decisions are left to the States. In my state our prices are advertised at the total cost to the consumer. But this is pretty easy because we do not have a sales tax. Every jurisdiction makes different choices.
There’s thousands of different tax regimes in the US - dozens to hundreds in every state, thanks to city taxes and the like. All businesses would need to advertise the right price everywhere. Doesn’t scale.
It’d be neat to see a campaign to popularize a term like “final price” or “all-in price”. It’d encourage the creation of products that always show the right price even as taxes change. And consumers would be empowered.
>There’s thousands of different tax regimes in the US - dozens to hundreds in every state, thanks to city taxes and the like. All businesses would need to advertise the right price everywhere. Doesn’t scale.
Of course it does. Seeing this excuse in 2024 is absurd. It has nothing to do with actual difficulty, businesses just don't want to have to do it.
Businesses should be required to say in general advertisements "product/service is $X + local applicable taxes". When you go to make your individual purchase they would then be required to show the actual total price you will be paying. Maybe include a breakdown if people want it.
Creates a burden for businesses to comply? Too fucking bad, that's the cost of being allowed to do do business.
I have heard this before, and I get the sentiment, but a supermarket usually already prices things for the local area. The same company in different location can have different prices for the same exact thing. So companies can already handle localized pricing. They just use it for their advantage and hide the cost of taxes.
Other countries handle this fine. It really isn't any more complicated than properly collecting the sale taxes already. Just decide the price of a thing and add the tax then show the final price. You could also, which is something I saw done in Japan, show the Tax Free price so it's easier to compare.
But I kind of don't buy that it would actually much harder than any other hard thing supermarkets do to put the full price on a jug of milk or etc.
> All businesses would need to advertise the right price everywhere. Doesn’t scale.
it's 2024 man, there are computers that can calculate this. Most retails update tags weekly anyway; literally just a stockboy swapping tags out. Tax laws don't change that much.
Walmart and other stores have been experimenting with electronic tags that change price based on demand and time of day.
Like, the Australians do it and it works just fine. Price says $5.50 AUD and when you rock up to the counter the price is 5.50.
If only we had something like automated calculating machines which can query a library of tax dats and calculate the amount through arithmetic and then display it.
As far as I can tell, it's a combination of corruption, mediocre education, and plentiful amounts of sugary foods and entertainment options (bread and circuses).
When this started showing up near me the places that did it trained their staff to tell you up front that it was on there. They'd make a comment that you can add extra if you wish, but no obligation to do so. Over time I've found more and more they just don't mention it at all. More than once I got home and realized I tipped on top of the total + service charge: "Why was that about $100 more than I thought it'd be?", well ...
Far more common here are ~3% "kitchen appreciation fees" that get paid directly to the kitchen staff. I'm AOK with these but some people really complain about them.
> Far more common here are ~3% "kitchen appreciation fees" that get paid directly to the kitchen staff. I'm AOK with these but some people really complain about them.
It’s annoying because they could price it in up front. A restaurant bill looks like a utility bill these days with all of the line item charges, just include the damn fees in the price of food!
The argument, which one can choose to agree with or not, is that this allows them to scale BOH pay with how busy the night is. That's similar to how tipping works for FOH staff, but at least in my state BOH staff are not allowed to share in any tip pool.
It'll be like cell phone bills, in particular the post-paid variety. I have a line that is using Consumer Cellular, and the plan is ostensibly $20/month. The actual bill is $28.02. Insanity.
> Far more common here are ~3% "kitchen appreciation fees" that get paid directly to the kitchen staff. I'm AOK with these but some people really complain about them.
I am 100% opposed to this. It's manipulative at best. The right way to do it is to pay the staff more and increase the prices. At least that would be upfront and respectable.
> More than once I got home and realized I tipped on top of the total + service charge: "Why was that about $100 more than I thought it'd be?"
Assuming the service charge was even 15%, for it to be $100 more than you thought it would be, your bill would be $600+ (simplifying for taxes)...
I don't go out for $600 dinners that often, though I have.
And that being said, I do think tipping does bring out some less sensical practices - why should the server get five times more for serving me a single bottle of wine if the wine was $100, versus $20? It was still a single bottle of wine.
To be fair, by "more than once" I meant 2-3 times, not a regular occurrence. :)
The last time it happened was ~300 + 20% service charge + a tip that'd have been in the low-mid 20's. That works out to be a bit under $100. It started to bug me on the walk home, and I double checked the receipt. I don't like scrutinizing receipts but I've started to do it a bit more.
> why should the server get five times more for serving me a single bottle of wine if the wine was $100, versus $20? It was still a single bottle of wine.
The argument, which one can choose to agree with or not, is that the kind of place where one is buying a $100 bottle of wine has a higher degree of training, care, etc involved.
> The argument, which one can choose to agree with or not, is that the kind of place where one is buying a $100 bottle of wine has a higher degree of training, care, etc involved.
What if the restaurant serves both $20 and $100 bottles? Do they adjust the quality of service on the fly to make pouring the $20 bottle profitable? Offer extra labor-intensive services only available with the purchase of the $100 bottle?
It isn't unrealistic unfortunately. It's not unusual for a few people to rack up $300, especially with drinks involved. Many states (e.g. Texas) have sales tax, so already +8.25%. Add on an 18% automatic gratuity, then tip another 15% unknowingly and you're paying $440 for your $300 worth of food...
What I don't get is why restaurants don't just raise their prices. It's quite disrespectful to customers to advertise one price and charge them for another at the last second. It's Ticketmaster scumbaggery. Do we really want more of that?
It's out of control. More tipping, more surprise charges, higher prices for the food itself, smaller portion sizes, worse or same service. Taking into account these factors, inflation is much higher than the CPI.
I just think that the entire tipping thing is ridiculous. Imagine going to a supermarket and tipping the cashier. Or going to court and tipping the judge.
I live in a place where owners aren't legally required to pay their employees tips and I too consider it fraud if the jar or machine describes the voluntary surcharge as a tip because a reasonable person would consider a tip to be something that is paid out to staff.
It's really tiring to know that there's no legal recourse for what is obvious and normalized fraud when law enforcement receives budget increases year after year.
Doubtful. If they were on the bill that you were presented before handing over your card, you're assumed to have read and accepted the charges before payment.
The only exception would be if it was misrepresented as a tip, or tax (Telcos used to do that one, phrasing their fees as taxes, to the point that "you are not allowed to call a charge a tax unless that charge in its entirety is going to a governmental entity").
The strangest thing I've seen was a mandatory ~5-10% charge that explicitly wasn't a tip and wouldn't go directly to workers, but instead went to the owners so that they could "provide sustainable wages to workers"
I'm not against paying reasonable wages, but that should definitely be, you know, part of the actual menu price.
Six months ago I was at a burrito place and saw as I was paying that there was a new 3% fee for paying with a credit card. I have not gone back there since.
Asking $11 for a burrito was already iffy and by then I'd started to curtail fast food purchases. I can't even imagine paying an 18-20% fee that isn't meant to be the entirety of the tip.
That's not far off from what the merchant is losing for credit card customers, so their options are:
1. Charge the same for credit cards as cash, and make cash paying customers effectively pay more, thus applying a regressive tax to the poor (who are less likely to have credit cards)
2. Charge more for the credit card paying customers, and they can avoid this extra payment by paying with cash.
2 is obviously better, and I would rather go to stores that take 2 than ones which choose to charge everyone more, effectively to the detriment of those worse off.
It's not whether the behavior is logical or justified. It's that fast food is no longer worth the price you're expected to pay for it. Regardless of whether it's credit card fees or labor costs or energy costs causing prices to go up, the economics of fast food no longer make sense for the customer.
But also I don't understand why a cash customer paying the same price as a credit card customer should be considered paying more. The customer only cares how much they have to pay, they don't care about or feel entitled to a constant profit margin.
Would a customer paying cash ever switch to credit card just because they've learned the business profits more from the cash sale? No, of course not.
> 2. Charge more for the credit card paying customers, and they can avoid this extra payment by paying with cash.
Things may have changed in intervening years but about 20 years ago I owned some quick serve restaurant franchises, and the credit card companies banned charging a fee to customers for use of credit cards - there was essentially a most favoured nations clause in the agreement. If you were caught doing this they would terminate your service permanently.
Electricity and so on are already included independently of the payment method.
Yes, the store should be charging enough to its customers that it can afford electricity, and if it can't afford electricity, it should increase its prices.
It's not worth trying to account electricity use per-customer though, obviously, and it typically won't really vary by customer much anyway.
Credit card fees on the other hand do vary by customer, and can trivially be attributed to a single transaction accurately.
If you run a cafe, and one customer orders an espresso and the other orders a latte, are you not allowed to charge them differently?
Buying milk to make lattes is also a cost of doing business, but it's a cost that is only driven by people who buy lattes, so you pass the cost of milk on to latte buying customers and not espresso buying ones, right?
Credit cards are the same as milk here, only people using them cost you money.
Should all foods and drinks in a restaurant cost the same because otherwise you're passing on the cost of buying ingredients and staff labor, i.e. "the cost of doing business" on to customers unevenly?
Now I have seen it all - comparing a method of payment to milk might just be the greatest thing I have ever read on HN and that is ... something for sure ...
so let's try again - I am buying a product or a service. It is exactly the same product, same "milk" if you will :) now the business is telling me that based on the method of payment I choose (who the F carries cash around in 2024/25...) I will be charge _different_ price for the _same milk_? that ... makes absolutely no sense.
of course the business itself can choose to charge me extra 3% if I pay with Visa or 15% if I bring a goat to barter with but of course I am going to pick my ass up and head on over to a competitor who won't charge me 3% or 15% extra
> it is cost of doing business and you can’t pass that shit off to customers
If a business doesnt pass on its costs of doing business to customers, they will go out of business. The cost doesn't need to be passed on as a fee or surcharge, but it does need to be passed on.
I don’t think you understand. Per your other comment:
> it is cost of doing business and you can’t pass that shit off to customers
What do you think prices are? They are the costs to the business plus some profit margin. Visa is passing their costs down to their customers too.
Businesses are completely within their right to pass the CC charges on to customers. It becomes the customers’ cost of doing business with their preferred method of payment.
That's all fine - businesses can be within their right to do whatever they please. However, myself and myriad of other people will simply go elsewhere where we are not charged different for the same product/service depending on the method of payment we choose :)
I stopped needing gas long time ago but if I needed gas I sure as heck am not going anywhere where I can save $0.10 to pay in cash (probably spend 2x that in gas needed to get to the gas station to save $0.10 per gallon). or for that matter ain't going to any place that has a different price depending on my method of payment.
I was also going to say, between the Costco executive membership's 2% rebate, and CC incentives, it's probably a wash anyways between that or the 10¢ difference.
Exactly. The Visa fees are a percentage (sometimes plus a per-tx fee as well). Electric bills don't usually double when the customer spends twice as much.
The distinction I meant to make is the "cost of doing business" is all the things required to do whatever your thing is.
The food ingredients, the building rent, the electricity and cooking gas, those are all required to make the burrito, every burrito.
The credit card exchange fee is like chocolate sprinkles on ice cream. It's a completely seperate and optional thing. This totally seperate company offers an extra service you may or may not want to add on top of your burrito.
That's nothing at all like the electricity, and is not at all part of the cost of doing business. It's the cost of doing an entirely seperate business.
An interesting thought experiment: what if a store let you pay by bank wire (let's say $20 fee)
Would you stick to your guns and say that cash users have to subsidize expensive wire fees? Or is that too much, and the fairness ends at subsidizing the expensive credit card fees? If so, why the distinction? If you could pay by bitcoin, should cash users pay the bitcoin transaction fees too? :)
Also, do you really think 3% is a fair tax on the entire economy that we should be giving to the duopoly of MC/Visa, when they only charge 0.3% in most of the rest of the world? The only reason they charge so much here is because they can get away with gouging due to our non-functional regulatory environment. I don't know why so many people accept 3% as a law of nature or something when the cost of handling cash is far less than that.
if paying by bank wire costs $198 and you want to offer it as a method of payment - it is on YOU.
amazing people here don’t understand that there is a cost of running a business. you don’t want to pay Visa 11% - don’t. you don’t want to pay apple 30% - don’t make ios apps. it is that simple mate
So your point of view is that businesses shouldn't be allowed to give customers choices that have different costs and charge them fairly? Every option has to cost exactly the same for everyone?
How do you feel about shipping options then? Should Amazon charge the same for 5-day ground as they do for overnight shipping?
you do realize you are comparing apples to oranges? charging customers for usage of credit card is specifically forbidden so any business doing is in breach of contract!!
this has nothing to do with shipping options. you cannot charge me money for using a credit card mate, it is 2024 (soon to be 2025).
1. Visa/MC should be allowed to overcharge and we should all accept it because Visa/MC said so in their contracts.
2. You like using credit cards, and things that you personally like should be free in 2024, and other people should pay extra to subsidize your personal preferences.
I'm not convinced. I don't think your personal preferences will be enough to reverse the trend of businesses charging fair prices for different payment methods either. But you're welcome to try.
> the businesses should however offer it and pay whatever that costs
So, in other words, you're in favor of a minor tax on those worse off than you, with poor credit score or otherwise can't get a credit card, so that you don't have to think about how your credit card company is ripping the merchant off.
If the business doesn't write that "3% for credit card users" down, and 90% of their customers use credit cards, their logical next step is to instead increase the price of all items by 2.7%, which lets you save a minor amount of money by screwing over those who are worse off.
If you just actively want to worsen the life of poorer people for your own benefit, well, I guess you're at least on the right site for it. May I recommend applying for the YC spring batch.
> So, in other words, you're in favor of a minor tax on those worse off than you, with poor credit score or otherwise can't get a credit card, so that you don't have to think about how your credit card company is ripping the merchant off.
ugh I am not saying any of this... if you have cash - pay with cash. I do not want to get a benefit for paying with a card (though of course more and more places do not even take cash any longer) and when I say card I don't mean actual credit card, debit card works just as well. just don't charge me any different
> If the business doesn't write that "3% for credit card users" down, and 90% of their customers use credit cards, their logical next step is to instead increase the price of all items by 2.7%, which lets you save a minor amount of money by screwing over those who are worse off.
This is their problem, not mine. If they want to charge extra - that is fine. I won't pay extra. If every business charges extra than I won't have a choice but as long as there are places that don't I am spending my money there.
> If you just actively want to worsen the life of poorer people for your own benefit, well, I guess you're at least on the right site for it.
Where are you getting this from? why am I worsening life or poorer people?! What if a poor person does not have any cash on them but has a debit card - we gonna punish them for not carrying cash around?! It seems like you are arguing the opposite here or just assuming poor person = I carry wads of cash with me everywhere...?
In the US, credit card surcharges have been permitted since that contract provision was invalidated in 2013. There are some restrictions that vary by state. [0]
Since most people pay with cards these days [citation needed], it seems like it would go over much better if the 3% processing cost were built into the normal price, and then you offered a 3% discount (or 2.91% for you pedants out there) for people paying in cash. The card users don't feel like they're being nickel-and-dimed, and the cash users feel like they're being treated specially.
If you charge 3% just to credit card users, they are now subsidizing the cash customers. I am guessing you are assuming the cost of cash handling to be zero.
Not to mention, as someone who spent a few years in that industry, in many cases those cash customers are not getting reported to the IRS, or local authorities for sales tax.
So they could already be "saving" up to 10% or more on cash customers...
Those particular Visa terms of service eventually got shot down in New Zealand - now many POS terminals/cashiers will tell you that there’s an additional charge for credit cards [0]
(Also, no tipping in New Zealand, except for a few restaurants close enough to the cruise ships that they think their customers won’t know any better).
I dread the day I have to eat at US restaurants, or even get something delivered. Part of the reason is cultural: I’ve never lived in a country where a tip is mandatory and you’ll be called out if you don’t. The other reason being it involves a degree of social pressure and shame, if one doesn’t tip enough. Both don’t sit well with me.
But I can attest that if I’m forced to tip, I’ll not return to that establishment.
In my experience, it's uncommon to be called out for not leaving a tip, at least on the East Coast of the US. At worst, you might get a nasty look depending on the context (unlikely at a cafe, maybe at a nice restaurant with good service).
Exactly why I'll never visit twice any establishment that asks me for a tip. If I ever go eat in a restaurant, it's because I want to have less stress in my life, not because I want to put myself in a shitty situation where not only I need to be up to date with current social norms (which has always been a difficulty of mine), but I also need to do things that go against my beliefs (tipping is a scam akin to TicketMaster "€100 ticket + €20 shipping fee + €30 convenience fee + €35 what are you going to do about this fee + €15 fee won't make a difference = €200 vs advertised €100"). As a result, whenever I visit a restaurant, the thing I remember the most is not the food nor the ambience, but the moment of tipping when the waiter begs me for a tip like a Syrian refugee begs for water. This is not a problem in my country because thankfully begging isn't as common here, but when I was travelling I was once asked for a tip during a hotel breakfast, which BTW was shitty.
Also, tipping is a monument to human stupidity. Apparently, people would rather pay €10 + 20% tip than €12 with no tip, because the former feels cheaper, even though it's a stupid way to organize pricing.
I've lived here for a long time, but this stuff still gives me anxiety. I get you are supposed to tip in restaurants, but I'm unsure which other services need tipping. Is it required to tip, for instance, the HVAC repairman? Are you supposed to tip mechanics? Do native Americans have a spidey sense for which people need tipping that I just need to become sensitized to?
Any luxury service (consensus determines what a luxury is in this case, not the individual) that is personalized, intimate, and requires spending a lot of time with you would carry the expectation that you tip. HVAC is seen as a necessity in the US, the same with cars, and the same with medical care. Tipping wouldn't be expected in those instances.
The only situation where there is an unwritten expectation for a tip is at a sit-down restaurant with waitstaff and for food/grocery delivery. These are luxuries 99% of the time.
In all other cases that I know of, they will ask you outright if you want to tip. For example, when I get a haircut or a massage, they ask me explicitly if I want to tip, and, because it was a personalized, intimate, luxury service, I oblige. For simple walk-up services like coffee or take out, I wouldn't tip.
The only other times I tip are for exceptional service (e.g. in a fastfood drive through) or if it's a local business that I'm fond of.
>The other reason being it involves a degree of social pressure and shame, if one doesn’t tip enough.
It's standard to tip 15% for decent service in a restaurant(sans win). You are of course free to tip more for good service or less for crappy service, but unless your experience is truly exceptional (in either a good or bad way) you can never go wrong with 15%. This is standard any US restaurant where you sit down and are served by a waiter or waitress. You are never "forced to tip", but you will be universally looked down upon in any sit-down establishment that you fail to tip in, so you might be best off not returning.
The last metric in this 2017 study, before the pandemic, showed tipping was between 18% and 19% in, "surveys (that) are aimed at diners who patronize full-service midscale and upscale restaurants". It also shows a downward trend in the last few data points. All things considered, including diners who patronize "downscale" full-service restaurants (like diners), and given the many decades-long standard of 15% tips, it seems to me a safe standard to continue to use. Certainly no foreign visitor will ever face vitriol for tipping 15%.
The 15% standard supplanted the previous 10% standard somewhere in the 1970s and lasted to the early/mid-aughts depending on where in the US one lived. I don't agree that ~30 years is "many decades-long". Further, that 15% itself was an uptick from the prior standard demonstrates that we're dealing with a moving target, for better or worse.
I'm also from a culture where tipping doesn't happen. I've been living in the US for a number of years, and I rarely go to a restaurant here, because the experience is too awkward.
On the other hand, I find delivery services quite reasonable. They tell me the total price (including the expected tip) before I order. You rarely see that kind of honesty in an actual restaurant. And I don't have to see the person I tip, which makes the experience much less awkward.
Speaking for myself, it is not a mental block, it is disgust with the social design of tip culture. Including tips, waiters are better paid than teachers, and many other more essential professions that require higher qualifications. The pressure is disproportionate to their financial situation. Let's normalize paying everybody what they are worth and do away with the tortuous guilt trips.
To be clear, I am promoting eliminating tips, and paying everybody in the lower 90% of wage earners more for their work. I have no interest in shortchanging waiters.
> tips are tax-advantaged (there's no sales tax on the tip)
Someone please correct me if I'm wrong, but the bigger tax that's avoided here is corporate taxes, I think. The tip goes directly to the employee, and it's thus not taxed as corporate income, is my understanding.
EDIT: Ah, I missed that corporate taxes were on net earnings rather than gross, so this wouldn't make any difference. Thank you!
The primary corporate advantages to tips is they allow the business to display artificially low prices to customers (since they don't include the tip) and pay artificially low wages to employees (tipped jobs have a lower minimum wage).
I work at a Dominos and we of course accept and expect tips on delivery, because without tips the drivers would make <$5 an hour after paying for gas and their vehicle’s depreciation.
But at checkout for carryout orders the card terminal also now opens a tip menu. I would never tip on this screen because the employees are already paid a true hourly wage, albeit a low one, not a server rate that is below minimum wage.
Furthermore there is no way for the customer to know if the employee they are tipping is even one of the bottom paid line cooks or a manager or driver who are already making $20/hour at my restaurant—what most servers make after tips. I am a driver and sometimes accept payment for carryout orders and end up receiving credit card tips that should really go to the line cooks. When we aren’t busy I make an effort to reach over and click “no tip” for the customer, as checkout employees at other restaurants sometimes do for me, but sometimes it’s busy and I get tips anyway.
As others have said I think doing away with tips altogether would be best but it seems unlikely that will ever happen. A compromise would be to somehow ban “customer facing” tipping for things other than delivery—no tips at cash registers, only for “pay at the table” establishments.
> I work at a Dominos and we of course accept and expect tips on delivery, because without tips the drivers would make <$5 an hour after paying for gas and their vehicle’s depreciation.
The business should own the cars and pay for the fuel. Or they need to be at least compensating drivers by the mile at the current IRS rate. Especially considering Dominos charges a delivery fee. Where is that going to if not to the drivers?
As another commenter crudely pointed out with their "not my problem", your boss is supposed to make up the difference between your <$5/hr and whatever the minimum wage is in your area[1]. Therefore any tips _up to_ your minimum wage are directly subsidizing your boss, even if you end up making a higher hourly wage overall.
FWIW, I always tip 20% because that's the society I grew up in, but it always leave a bad taste in my mouth when I'm not exactly sure what I'm tipping for, my wage has been stagnant for several years and all of my own costs are going up. Ultimately it just leads to me going out less, which I think is a net negative for my local service economy. It's hard to justify $20+ for a single meal when I easily can turn that into 4-5 meals at home.
I only know because a friend was a delivery driver and complained - it’s so easy to overlook. Completely agree, no one should have to worry about whether working full time is enough to exist on.
I feel the same way and if EVERYONE felt the same way things would change rather quickly. if everyone stopped tipping every pizza delivery driver most would quit shortly thereafter and dominos/papa johns… would have no choice but to pay adequate wage.
however, since most people are tipping the ones that don’t are as the assholes :)
all that is wrong with US culture summed up in one sentence. instead of realizing you are slave employee being paid less than people in 3rd world countries and relying on handouts from customers you call ones that do not want to give you an undeserved handout a weirdo…
Let’s have restaurants raise prices to cover employee salaries, and make it illegal for them to ask for tips. Customers who want to tip need to do so without solicitation. (Not sure how this would work with credit card terminals though).
As the owner of a bakery/cafe - thankfully in a country where tipping isn't normal - changing prices to cover costs isn't a simple thing to do, unfortunately. Customers are extremely sensitive to price changes, and expect certain price points. We have 7% inflation, and our suppliers have no problem raising their prices to reflect that. But we can't match them easily. 50k and 100k VND are prices that customers orient around here. In the US the equivalent might be $10 and $20, where one is cheap for a meal, the other is expensive.
Notice that those are just round numbers rather than specific values. What happens when inflation means that $10 is no longer sustainable for a meal? You can either increase the price and weather all of your regulars complaining, and new customers viewing you as an expensive location. Or, you can cut costs.
The same applies if you have a sudden new expense. Say, taxes go up. Or you decide to stop requesting tips and start paying staff a living wage (something I'm strongly in favor of). Then you'll need to increase all prices by 30%. Do you think your customers will be happy? No way! And even those customers who do support and agree with you, subconsciously they'll still be comparing you to other places that haven't done this and your place will be comparatively expensive and they'll come less often. Yes, even if they end up paying less after factoring in tips. Customers (in general) are not rational that way.
Then the only option is legislation so that everywhere changes at once. And good luck with that!
All that will happen is people will develop scar tissue and just not tip anymore. People used to be polite and be nice when they picked up the phone from some number they didn't recognize. Scam artists USE this old custom to scam people. Well, most people don't even pick up the phone any more and for people that have to, like myself, the instant I recognize a cold call, I just hangup. I don't feel guilty about it anymore, in fact, I feel empowered.
Tipping at terminals is going to happen the same way. The idea that some minimum wage person is gonna recognize you, let alone still working at these places will key you in on this is just something that will go away.
Tip at a sitdown restaurant, that's normal. Tipping at a terminal for takeout, screw that.
Went bowling yesterday. A tip prompt turned up when it was time to pay with no obvious way to avoid tipping. To do so you just had to hit enter instead of picking one of the preset choices but I couldn’t fathom why I’d ever tip the guy who hands me my one shoe back after knocking down some pins.
To generalise the observation: I've definitely shifted my own behaviour where I find coercive, obnoxious, or toxic patterns.
"Loyalty coupons" where the number of items bought to receive one free escalated on subsequent purchase? Stopped shopping at that store. I'm not someone's Skinner Box experiment.
Websites with increasingly user-hostile experiences (or moderator-hostile), o hai reddit and googs, yeah, eff that noise.
Manufacturers selling shoddy products and failing to support them? Bad reviews and shop elsewhere (though that's often quite difficult).
As the poet notes, "Rage, rage against the dying of the light."
I've noticed a related phenomenon to this, one that (I assume) comes more from POS providers like Square than from businesses themselves: the default "flow" on these tablet-style POS systems doesn't distinguish between culturally tip-able transactions and ones that are not conventionally tip-able. As a result, people feel pressured to tip on things that weren't previously considered.
A concrete example: a bakery near me uses the same POS terminal for both cafe sales and bread sales, meaning I get asked to tip on loaves of bread. I've seen people get flummoxed and tip $1-2 on bread sales because of this.
These kinds of behaviour change the entire relationship between you and a business from transactional to adversarial. You're no longer engaging in a clear transaction, but in a negotiation that involves guilt tripping and fear of judgement. I just want a beer; why do I have to defend how much my interaction is worth on top of the retail price?
Walmart has an interesting option when it comes to tips on grocery delivery.
If you have a Walmart+ membership ($98/year or $12.95/month) you get free home delivery on grocery orders of $35/month or more, and tipping is handled just like most delivery services--you don't have to but most people will feel guilty if they don't.
But if you add the Walmart InHome add-on to Walmart+, which adds $40/year or $7/month, then the delivery people are not allowed to accept tips. If you want to show your appreciation Walmart says you can leave a note or comment on your delivery survey.
Note that if you just have groceries delivered once per month, and order the minimum amount for free delivery ($35), and leave a 10% tip (the minimum most people who tip out of guilt will probably leave) that will come to more than $40/year in tips so InHome might actually be a decent deal.
BTW, it is called InHome because no tipping is not actually the main point. The main point is that instead of just dropping your delivery off outside they will put it where you want, including inside your house. They will even unpack it and put things away in your fridge and cupboards if you want. I think I'd find that kind of creepy because I really don't like other people in my home, but I can see how some people could find it useful.
I'm more likely to pay cash at those type of businesses. As then there is no tip screen. And as the article states I have also avoided some businesses because they have them.
The worst service that I ever received was in France, where tips were mandatory and could not be varied. I've never been so offended at being asked to tip as when it was done by the smug jerk who had just arranged to make sure that I didn't enjoy my meal, and who knew that they would get their full cut of my unhappy experience.
I have no problem tipping in the moment. And sometimes for very different amounts than expected. But if you expect a tip and didn't earn it...?
You probably fell in some tourist trap or something. I hope you didn't tip.
Tips are absolutely not mandatory in France. You pay for what you order at the price you see on the menu and nothing more. Small tips are appreciated but not expected. I am French, I have eaten in many restaurants of all kinds and I have never been asked to tip and I tip only occasionally. As for surcharges, they sometimes happen, for example if the restaurant is part of a club and you are not a member, but never at regular restaurants, it may even be illegal.
I am sorry for your experience, they probably noticed that you weren't a native and attempted to trick you. Was it in Paris? It seems like such unacceptable behavior is more common in Paris.
Note: I interpreted "mandatory tip" as having to pay a surcharge. Of course, part of the bill goes into paying the waiting staff, but it shouldn't appear on the bill, that part is between the employees and their boss.
Square is the most egregious offender of this in my neck of the woods. Outrageous tip options (usually starting at 20%) and a large screen that make your selection obvious leave a bad taste in my mouth.
I've witnessed multiple businesses switch to Square and the suggested tips skyrocket. I don't know if it's a default or just a coincidence.
Customers actually do have a way to retaliate against establishments they feel are abusive: leave a bad review. Businesses depend on the organic traffic they get from Google and Yelp listings, so sustained feedback against abusive tipping pressure will get noticed if people start to make a point to write reviews about it.
> Customers actually do have a way to retaliate against establishments they feel are abusive: leave a bad review.
What do you do if you don't want that review tied to your account/identity, or prefer the fact that you've gone to that establishment to not be published to the whole world?
In Canada, there is no longer any special wage below the minimum for servers. They receive the same minimum as many other blue collar workers.
It's over, there is no longer any reasonable argument for tipping servers but not a whole host of other low wage earners.
They’re finding new and creative ways to add extra costs to your meal in addition to asking / demanding / shaming you to tip. I’ve solved this problem by not going out to any restaurants and cooking at home. And when I do eat out it’s usually at take out places.
It has gotten so out of hand that I think a USP for a new or existing restaurant would be to advertise as a no tipping establishment. Pay your employees a fair wage and adjust your meal prices accordingly. Who knows? It just might catch on.
Since eating out got excessively overpriced I've started cooking more consistently than I ever had before in my life. The food is much better, besides being obviously cheaper as well. And I'm not even saying I'm good at it, it's just easy to find a few basic things you like that aren't hard to do well.
Not the main topic, but the article is in part on how people respond to changing normative pressures so I think it's fair: I'm surprised at the low level of information in this article given that it's written by the original researchers! In many other fields I would have expected greater specificity and care from academics presenting their work to a lay audience. For example they say "our results were clear" but then only describe the direction of the effect -- they give no numbers about magnitude or significance! And following the link to their paper ... it seems pretty bad?
Study 1a was done at a single brewpub, which uses 2 POS systems from the same provider, one counter-based and one hand-held. They say nothing about what kinds of customers or transactions get the hand-held (presumably table-side?) POS system instead of the counter-based one. Are these different group sizes? Different seating areas? Food vs not? It's not a random assignment? So (a) it's hard to know whether the effect is real in the one business they measured with or if it's just that different kinds of customers are more or less likely to return and (b) it's hard to know whether this actually generalizes to other businesses. What was the effect size? During a 1 year period, customers whose first visit used a handheld POS had 1.1 subsequent visits vs 1.46 for customers whose first visit (within the period) used a counter-based POS. They're grouping people by their first visit in the period, as if that's going to be determinative of how they think about the business, but they don't know which customers were actually new (i.e. one month before the captured period, did you go and use a hand-held POS and then in the 3rd month of their period you went and used a counter-based POS? You're in the counter-based group.)
All the rest of the 'studies' in their paper are market-research surveys.
American tipping culture is getting exported because of the software, too. Here in the Antipodes, tipping is not the norm at all, but the American produced point-of-sale software has tipping options on by default and they don't get adjusted.
Hang around Australian Reddit groups long enough and you'll see the occasional rant about it.
FYI - The tipping option on Square POS is a default setting that automatically generates default tip ranges.
In a lot of cases, the vendor just enables tips and doesn't care to optimize.
Alternatively, you could always tip in cash or just not tip. I've never been in a situation where I've been forced to tip and I've eaten at restaurants at all ranges of quality.
Tip awkwardness has played a surprisingly big role in me eating healthier. No I don't want to tip you for handing me a prepackaged muffin. But you're paid like shit with an eye on making up the difference in tips. So I guess the choice is to just not shop there. Which takes out almost all places I'd get a snack at during the day.
I've always wanted to ask for those who worked as a cashier or waiter in those restaurants with the ipad style payment platforms if they actually receive the tips on those things. It always seemed like such a generic default option that was always left on in those apps that I wondered if the business even acknowledged them
One of the reasons why I hate visiting the USA. There were several instances where the choice of vacation destination was influenced by previous bad experiences like with tipping in some obnoxious restaurant, we just went elsewhere.
Just came back from Spain, France and Italy. None of the restaurants have tipping. It makes for such a better and more relaxed experience. The U.S. needs to get with it.
Yep I was in a different part of Europe recently and it was the same. This wasnt about cultural norms, there was literally no way to tip when paying with a card most places (aside from leaving cash).
I've been seeing more and more places also include the taxes and other fees in the total used to calculate the suggested tip. That seems pretty slimy to me.
Tipping is a tough problem: if you pay customer facing employees more, you'll need to raise prices. If your competitors still have a tipping expectation, their menu prices will be lower.
And let's be real, most customers aren't savvy enough to think about that ahead of time, which is why most restaurants that have attempting no-tipping systems in North America have failed (or reverted back to accepting tips).
There's also a segment of the population that enjoys the perceived power of holding a tip over an employee's head.
Most people do think about pricing - not to the penny, sure, but you have to be really rich not to have an idea about roughly where going out will fit in your budget. There are two reasons why tipping is popular: restaurant owners think it motivates employees to flatter/put up with customers and/or allows them to skim some extra income, and there’s a certain type of diner who loves the power imbalance (e.g. every guy who sexually harasses waitresses loves pushing to see how much they can get away with, or the demanding people who calibrate their behavior just below the level where someone’s going to decide that the chance of a tip isn’t worth it).
The first group likes to tell high-income service workers that their pay will go down without tipping, which is fairly effective at finding people to be the media front saying workers don’t want to get rid of tipping instead of the other 90% who are guaranteed to benefit.
No offence but you're kind of proving my point. I said nothing about a difference in pricing because there isn't unless you actually tip $0 (which statistically very few people do). $24 (restaurant includes tip in price in order to pay servers a fair wage) is the same as $20 + 20% tip.
Most of the rest of your comment is what I said with different wording.
> high-income service workers
There's very few high-service income workers. I served tables through university, even if you make $400 in one night there's not enough of those nights for you to be "high income". If you're a stellar server working full time you can maybe equal what an average accountant makes in a year (which is pretty mediocre), but with more stress.
> There's very few high-service income workers. I served tables through university, even if you make $400 in one night there's not enough of those nights for you to be "high income".
I wonder if this has changed as both prices and tip percentages have gone up. At $50/person tickets and a 20% tip, you'd only need to serve 100 people to make $1000 in tips. 100 people a night is unrealistic for many restaurants, but I'd think a server working full time could easily do a couple hundred customers a week which is $100k/year in tips.
If your argument wasn’t that a no-tip restaurant would seem higher priced, what was the purpose of your second paragraph?
> There's very few high-service income workers.
Yes, we’re in agreement? I was just referring to how the opposition here would trot out quotes from some bartender who makes $75/hour and not mention that they were the upper fraction of a percent and the median was considerably lower.
> If your argument wasn’t that a no-tip restaurant would seem higher priced
Of course it seems higher priced. That's the point. Perception. Seeming higher priced != higher priced if there's the expectation of tipping and you follow it, but the average consumer isn't very savvy so it ends up scaring them away. Which is why restaurants that try to include service in their pricing end up reverting or failing.
Also the only opposition is really from consumers (which then spills over to owners who get to hear all the complaints). Europeans get along fine with not tipping.
This makes for an uncomfortable situation where I now have to ask the waiter or bartender if they receive this as a tip. Then I need to decide if I want to tip something like 5% to 7% extra, which would be a good 25% tip in total, but looks like a crappy 5% tip.
So after dealing with that, I just don't go back to those pubs or restaurants.
There was one bar where the waitress told me she doesn't get that service charge. It just goes to the house. So if she was telling the truth, all of the prices on the menu are just a lie.