We often find ourselves in a familiar situation: ordering a coffee and then being presented with a suggested tip amount of 25% to 30% at the pay kiosk. What should you do? Many Americans are uncertain about tipping etiquette. Pew Research Center’s poll of nearly 12,000 U.S. adults revealed that only about a third find it easy to know when and how much to tip for different services.
While there’s no one-size-fits-all method for tipping, understanding the history of tipping, recent changes in tipping culture, and how to approach it can be helpful. Key takeaways include: – Tipped employees, who earn over $30 in tips monthly, often receive a base wage of only $2.13 per hour. – Digital payment systems have increased the pressure to tip, leading to ‘guilt tipping’ in situations where tipping might not be expected. – Tipping has become more common across various services, with many Americans unclear on etiquette, resulting in a rise in tip amounts, known as ‘tipflation’. – Tipping isn’t required for counter service, and extra isn’t needed if there’s an automatic gratuity. If service is poor, it’s okay to tip less, but aim not to go below 10%. The evolution of tipping culture began post-Civil War. Tipping was largely unknown in the U.S. before the Civil War but gained popularity as wealthy Americans brought the practice back from Europe. It also has a darker history, as it grew when the restaurant and hospitality industries began hiring newly emancipated Black women and men, who often relied on gratuities for income. Technology has played a significant role in the rise of tipping requests. Digital payment systems use design principles that influence tipping behavior, making it feel more challenging to click ‘no tip’ on a kiosk than deciding not to tip unprompted. This has led to ‘guilt tipping’. The COVID-19 pandemic also had an impact on tipping culture. Many restaurant and hospitality workers struggled, leading to an increase in tipping to support these industries. An analysis by the National Library of Medicine showed that while tip-per-order was decreasing before the pandemic, it increased by $1.24 during the pandemic, countering the previous negative trend. Tipping expectations haven’t lowered since the pandemic, which could explain the sustained high tipping amounts over the last few years, referred to as ‘tipflation’. According to Pew Research, around 7 in 10 adults say tipping is expected in more places today than it was five years ago. Today, many service workers rely on tips for their livelihood. Understanding the tipping culture and its evolution can help consumers make informed decisions about when and how much to tip.The Department of Labor defines a ‘tipped employee’ as one who regularly receives more than $30 per month in tips. Under federal law, employers of tipped workers only need to pay $2.13 per hour in direct wages as long as this combined with tips meets the federal minimum wage. If not, the employer must cover the difference. Some states have a higher tipped minimum wage. For instance, in Alaska, it’s the same as the standard minimum wage ($11.73 per hour as of 2024). In Florida and Maine, the tipped minimum wage exceeds the federal mandate but doesn’t match the state standard minimum wage. Cities and localities may also set higher minimums. New York City has a tipped minimum wage of $10.65 (as of 2024), 65 cents higher than the state-mandated tipped wage. And ‘quick service employees’ in New York state earn the same $15-per-hour minimum wage whether they’re tipped employees or not. Tipping is a hot topic in the upcoming election as both presidential candidates propose exempting tips from taxes. When should you tip? When at a service-based institution like restaurants, bars, salons, and hotels. This includes servers, bartenders, hotel bellhops, delivery drivers, valet drivers, hairstylists, nail artists, and food delivery drivers. The tip amount varies but restaurants generally follow a 15% to 20% rule. RealSimple offers a tipping etiquette guide. For food delivery apps, a fair tip is $3-$5 per delivery. Consider adding extra if the weather is rough. When to consider skipping a tip? If you’re paying for counter service, tipping isn’t expected as counter workers typically earn a wage. However, it can be a thoughtful gesture if you’re a regular customer. When there is already a high service fee or automatic gratuity, especially for large parties, there’s usually no expectation to add more. But if the service was great, a 5-10% extra tip is nice. If the service wasn’t good, it’s acceptable to tip less than usual. Some may tip as low as 10%, but it’s advisable not to go below that. Consider factors out of the server’s control. Is it rude not to tip? Unless the service is terrible, most etiquette experts recommend not skipping the tip for restaurant workers. What professions should you not tip? Professionals paid a salary like teachers, plumbers, lawyers, and cable techs.
Tipping culture in the U.S. is influenced by history, economics, and evolving social norms. Changes in technology and the post-pandemic world have left many Americans uncertain about tipping. How can one show appreciation when tipping isn’t expected? Salaried workers such as teachers don’t anticipate a tip. But there are other ways to express gratitude. For example, giving a gift card during the holidays or writing a handwritten card. Also, a verbal ‘thank you’ is not overlooked. How do we know if a tip is already included? Look at your bill where it might be listed as a ‘service fee’ or ‘gratuity.’ Researching and staying updated on tipping practices can provide a clearer understanding of expectations. By doing so, we can help both customers and employees.