When stepping into my local restaurant, I used to feel great about tipping. Handing out a few extra bucks on top of my bill seemed like a small price to pay for efficient, high-quality service and to show my appreciation to a server. Win-win, right? Nope.
As it turns out, the tipping system is an archaic payment system that prolongs income inequality, fails to promote high-quality service and encourages discrimination. Given that 2.4 million Americans and counting rely on the restaurant industry for their livelihood, policy makers should make replacing the tip system a priority.
The tipping system enables restaurant owners to pay their servers less than a livable wage. Restaurant owners are allowed under law to pay their servers as little as $2.13 an hour, a payment that is well under the federal minimum wage of $7.25.
Perhaps it would be reasonable to pay servers at such a reduced rate if they consistently earned back their wages from tips or received extra compensation during slow weeks but statistically they do not. On average waiters receive $40-$80 in tips during a four-hour period of work and even less during slow days.
As a result, 15 percent of all tipped workers live below the poverty line, a rate that is double that of non-tipped workers. Tipped workers are also twice as likely as non-tipped workers to rely on food stamps.
Eliminating the tipping system would help reduce the national poverty rate and place greater responsibility on restaurant owners to consistently provide their employees with a livable wage.
Even if all servers consistently received enough tip money to cover basic living expenses, it would still be fundamentally unfair to base servers’ payment on a wildly inconsistent system that fails to reward quality service.
In virtually every non-tipped job in the economy, employees receive pay due to the trust that they are doing their job rather than arbitrary whims of their patrons.
Imagine how ridiculous it would be to pay doctors based on how happy his or her patients were with their diagnosis, or if musicians were paid after their concert based on how much the audience enjoyed the performance. It makes no absolutely sense to judge the quality of the server using a tip system but not the cook who prepared your filet mignon.
Unlike most workers, servers are paid based on the faulty assumption that extra incentives will affect the quality of their performance. In theory, servers who cheerfully say, “Welcome to Applebee’s,” put on a great smile while taking down orders and serve food efficiently will be rewarded for their great service with more tips than servers who scowl, mess up orders and take close to an hour to grab a plate of fries.
In practice, there is almost no quantifiable difference between the tips received by good and bad servers.
Studies show that a myriad of factors beyond quality of service determine how well customers will tip. These factors include everything from the quantity and quality of the food ordered to the quality of the restaurant, the temperature and atmosphere of the restaurant, the weather outside, the mood and wealth of the customer and how large a group size is.
Michael Lynn, a professor at Cornell’s School of Hotel Administration and a tipping behavior expert, estimates that serving quality only counts for 2 percent of the variation between servers who receive high and low tips. If tipping does not truly account quality of service, it is pretty pointless.
While tipping does not contribute to high-quality service, it does promote unfair treatment towards certain demographics. Customers base much of their tip decision-making on appearance, age, race and sex. According to Lynn, blonde, slender, larger-breasted women in their 30s consistently earn higher tips than male, black or overweight servers.
If tipping only accounted for an extra bonus given to servers based on personal preferences, then maybe this disparity would not be a significant problem. However, tipping is a server’s main source of income, making the pay disparity between people borderline discriminatory.
Servers do not need tips as motivation to provide high quality service; they will work for regular pay just like the rest of us. What they need are consistent, livable wages to support them while they are not dishing out hamburgers. It’s time for the restaurant industry to join the 21st century and replace the tipping system with the minimum wage.