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Comment by chrisseaton | Hacker News Reader

> if tipping is an option, through a kind of cultural game-theoretic pressure, the situation will always devolve into the restaurant norm. at least that's how it is in the states

In the UK tipping in restaurants is optional and, while it sounds really weird to say this, I don't think the waiters and waitresses seem to care either way. I don't get a different reaction from them if I tip or if I don't. They don't seem elated if I tip a lot or disappointed if I tip a little. Nobody seems to care and this situation seems stable as it's been this way as long as I've been an adult.

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This is the case in every country I have ever been. If you read a travel guide for any country it might say that tips are usually given to taxi drivers, restaurant staff etc, but only in the US has zero tipping almost become equivalent to not paying the tab in full.

Also, when I go to the US with 5-10 year intervals the norms for tipping seem to have always crept upwards.

It's pretty much 20% here it seems.

Then they raised the minimum wage. So restaurants added a 20% service fee on to cover it. Okay, fine. That's actually the outcome I wanted.

Except some places left the tip line. So now people still tip out of obligation.

Never ends.

I'm curious where people stand on the "To Insure Proper Service" backronym? I've always bucked back on that by saying "Well, taking some sense of pride in your work, even if that work is bringing people their food and are enjoying the experience of your establishment should insure proper service, otherwise why not work elsewhere?" but I'm not sure that's a very charitable stance to take so I've been wondering what others think as a means of evolving my position a bit?

It sounds like a pretty stupid backronym to me.

On the other hand, if you know beforehand that you are expected to compensate the service staff outside of the bill from the establishment, you should factor in your comfort level with that arrangement before you order, not act like it is some obscure thing you'd never heard of being done.

I'm against that backronym only because it would properly be "ensure", not "insure".

I find the poor spelling offensive

> only in the US has zero tipping almost become equivalent to not paying the tab in full.

Canada is the same way, do not tip 0% in Canada unless the waiter was abjectly rude or spilled something on you.

I find it strange that the same tipping norms exist in Canada as in the US, since, if I'm not mistaken, Canadian waitstaff are paid at least minimum wage. In the US, the fact that waiters are paid less than minimum wage and expected to make it up on tips is often cited to explain why it is so bad to not tip at all.

In BC, at least, liquor servers have a lower minimum wage than the norm, as they're "expected" to make up the difference with tips.

Unfortunately, you are mistaken. Minimum wage for tipping jobs is much less than normal, in all of the 4 provinces I've lived in (AB, SK, ON, QC).

Am I misunderstanding something? Alberta Labour lists this:

* General hourly minimum wage – $11.20 for most employees

* An hourly minimum wage of $10.70 for employees serving liquor as part of their regular job

https://work.alberta.ca/employment-standards/minimum-wage.ht...

> In the US, the fact that waiters are paid less than minimum wage and expected to make it up on tips is often cited to explain why it is so bad to not tip at all.

Waiters always earn minimum wage in the US regardless of what tips they get. A waiter who earns $0 in tips must still be paid minimum wage by the restaurant that employs them.

See the Fair Labor Standards Act per the United States Department of Labor: https://webapps.dol.gov/elaws/faq/esa/flsa/002.htm

By "less than minimum wage", the poster was referring to tipped wage - this is the lower, $2.13 per hour federal minimum which can be paid out to employees who make at least $30 per month in tips.

Since it is expected that tips make up the difference between the tipped minimum wage and the regular minimum wage, yes, tipped employees are actually paid less by their employers than regular minimum wage in the vast majority of cases. This is a large part of why tipping remains in practice - tips effectively subsidize the employer's payroll.

https://en.wikipedia.org/wiki/Tipped_wage_in_the_United_Stat...

A waiter who earns $0 in tips is likely an awful waiter and won't remain employed long. His employer does not want to have to make up the difference on a regular basis.

I'm not entirely sure if I understood your first paragraph, but it seems like you might have overlooked this quote from the page I linked:

> If an employee's tips combined with the employer's direct wages [...] do not equal the Federal minimum hourly wage, the employer must make up the difference.

In other words, the employer always needs to pay federal hourly minimum age. Paying a waiter less than minimum wage would be breaking the law regardless of what tips they get.

> tipped employees are actually paid less by their employers than regular minimum wage in the vast majority of cases

Edit: OK, I think I understand what you mean. I agree that because most waitstaff receive tips, the amount their employers pay can be less than minimum wage. However the amount that the waitstaff receive is always at least minimum wage.

In some parts of the US following labor laws is less prevalent than others. In many places the employer will simply ignore the law knowing they will face no consequences. Please see the south.

> In the US, the fact that waiters are paid less than minimum wage and expected to make it up on tips is often cited to explain why it is so bad to not tip at all.

Where in the world did you hear that?

Can't speak for the OP but: everywhere?

The federal minimum wage for a food server in the US is $2.13/hr. The employer only has to pay more if their tips don't average out to $7.25 an hour.

https://en.m.wikipedia.org/wiki/Tipped_wage_in_the_United_St...

Right, so even if they don't receive any tips they get paid minimum wage. It's a bit disingenuous to suggest they make less than minimum wage if they receive no tips.

In theory this is so but in reality you will be fired if you require the employer to do this.

> but only in the US has zero tipping almost become equivalent to not paying the tab in full.

Tipping in restaurants and taxis is kind of expected in Romania, too (more exactly the capital, Bucharest). Granted, the taxi fares are ridiculously low, so even with a 15-20% tip the price only starts approaching a "normal" level. Restaurants' tips are more like 10%. I also tip my barber/hairdresser, but that's because he does a really good job.

I think it is because they aren't getting paid $2.13/hr like servers in the USA are.

But this is a bit of a chicken and egg problem, isn't it? You could just as easily argue that the wages are so low because tipping is pretty much a given.

It's actually enshrined into law - restaurants are allowed to pay less than minimum wage because of tipping.

It's a perversion of the whole norm, since it effectively turns tipping into a subsidy to the restaurant owner.

https://en.wikipedia.org/wiki/Tipped_wage_in_the_United_Stat...

As your link says, they are not allowed to pay less than minimum wage. They are allowed to set hourly wages for tipped employees lower than minimum wage, but they have to ensure that the total compensation of the employee averages out to minimum wage.

Realistically, if the restaurant owner has to contribute anything beyond their hourly rate to the paycheck of the server, that server will be fired (or the business is so slow that it will go under soon).

My experience as a server was a lot of < $1 paystubs after taxes on tips.

Not necessarily. I briefly worked at a 24x7 roadside place where tipped employees would occasionally fall under minimum wage due to slow periods or customers who would either stiff the waitress or tip out $0.35 on an egg, toast, coffee which cost $2.65.

That place systematically robbed those staff by refusing to pay minimum wage and falsifying records and withholding taxes based in nonexistent tips. The Labor department fined then pretty heavily -- but that isn't an uncommon practice.

I'm not sure how this contradicts what I said. Your experience showed that the business was not contributing anymore to your paycheck than the normal wage. Had they not been breaking the law, they probably would have fired someone due to the "extra" expense.

Exactly - so any tip just reduces how much the owner has to pay to cover minimum wage, making it a subsidy to them, not to the server, who gets minimum wage either way.

It's not really a subsidy though, it's just a complication of the payment.

It could be a subsidy if it wasn't an established custom to tip, but people know quite well that they are paying the server a tip for the service.

I suppose the fact that it enables the restaurant to under-report wages and thus under-pay wage taxes is a bit of a subsidy (but then some of that savings probably shows up for the customer).

It is a subsidy, because the server gets the same, it's the restaurant that pockets the difference.

Say the server works 40h/week like a regular full-time worker, so the minimum take-home pay under federal law is $15000. If the server gets $0 in tips, the restaurant must pay the $15000. But if the server gets, say, $5000 in tips, the restaurant can pay only $10000.

The server gets the same money, only the restaurant gets to save some.

Right. In practice, servers get $15000+ in tips. So there usually isn't a subsidy.

It also has a non zero impact on the menu prices (they would go up if tipping wasn't expected)

Seattle recently passed $15 minimum wage and now a lot of restaurants are charging a "service fee" and putting up signs that discourage you from tipping. A much better system imo.

Washington State specifically doesn't allow tipped employees to be paid a lower hourly wage!

What's the point of a service fee on top of the cost of your meal though? Why not incorporate it into your meal, since it's non-optional.

I noticed they did this in Singapore. You'd be charged a service fee on top of your bill, I can't remember if they popped tax on top of that too. If it's non-optional, it should be included in the cost.

>What's the point of a service fee on top of the cost of your meal though?

For the same reason airlines don't include mandatory charges in their fares - humans are not particularly good at rational pricing evaluation.

It's known as partition pricing and generally results in higher revenues - from "The Effects on Perceived Restaurant Expensiveness of Tipping and Its Alternatives": [1]

"Furthermore, participants ordered more expensive meals when automatic gratuities were added to the bill than when the costs of service were built into menu prices"

[1] http://scholarship.sha.cornell.edu/cgi/viewcontent.cgi?artic...