The Tipping Point

Tipping in the U.S. has changed significantly over the past few years, particularly during the height of the Covid-19 panic, precipitating a need for payment methods to evolve. A key player in this were the proliferation of digital payment systems with customer-facing screens. Allowing you (and bystanders) to see your total and how much you tipped - adding a touch of social pressure. Are businesses using these point of sale machines to "guilt" customers into tipping for services we normally didn't tip for before?

The Social Pressure Of Tipping

Increases in the dollar amount and frequency of tipping were definitely noticed during the pandemic. People who were still able to keep their jobs and wanted to take advantage of the few businesses that were still allowed to operate, typically gave larger tips to "help out". Digital payment devices provided businesses with options that satisfied government edicts and allowed larger and even custom tip amounts for workers.

Now, point-of-sale hardware and other digital payment systems are nearly ubiquitous. They can be found in traditional sit-down restaurants, coffee shops and bakeries. Scan your credit card, provide a signature and a tip. It's the tip where businesses are taking notice. Tip percentages on a typical machine can range from 10% to as much as 30%.

That's not just at your typical business-casual restaurant, fast food places are asking for that as well. All in full view of your server or barista. You're being asked to add an additional 30% to your $5.00 coffee - for something that took a minute to make. They can do this because they have removed the complication and hassle typically involved with tipping. It used to be the case that for some services - like buying coffee, whether you left a tip or not depended on if you had any spare change in our pocket or small enough bills in your wallet to contribute - and if you didn't tip because you didn't have it or didn't want to was no big deal.

Now, with digital payment systems providing the customer with tip options, how much spare change you have on you is no longer an obstacle. Even the obstacle of calculating the percentage is removed, giving the customer even less of a reason not to tip. This is by design. Tightly wrapped in this convenience is pressure. Why wouldn't you select 20% after all the hard work has been done for you?

Should It End?

Should we end the practice of tipping completely? I don't feel that it is the customer's responsibility to make up the difference in a server's pay outside of what we're required to pay. It's the responsibility of the business. Menu prices can be increased, a service charge can be added to the bill, servers and kitchen staff can be paid more.

Many service industry employees say that they rely on tips to supplement their hourly wage. They know that customers are getting tired of being asked to tip every time they want to purchase something, but argue that they are equally tired of not being shown appreciation in the form of a tip commensurate with the service provided.

In an article in Bon Appetit by Adam Reiner, he argues that "the almighty tip still stands as the critical source of income for service workers". Maybe, but is that also true for the barista or fast food worker? It could be argued that it's a choice to work in the service industry and to build a lifestyle where tips will make the difference between eating or paying rent. There are conditions that come with any job - such as receiving a "bad" tip, sharing your tips or no tip at all. It's like working at a Hooter's restaurant and complaining about the uniform - you knew what to expect going into it.