04 Sep Will Tipping Go the Way of Dinosaurs?

The New York Times reports an interesting trend: more and more restaurants replacing tipping with a mandatory surcharge, or across the board increase in food prices, and the extra is shared with all employees of the establishment. Many hotels have been doing it for years, and it’s been common for large parties for a long time. Most private clubs prohibit tipping. And now more and more are looking at all the economics of waiter/waitress tipping and realizing it just doesn’t make sense.

Why? Unless you are a regular somewhere, the waiter doesn’t know what you’ll be tipping until the end, so they could work hard and you’re still a small tipper. Also, why should waiters with tips make 3-4 times more than what a hard working cook in the back is making? There used to be an “underground economy” of servers getting cash tips and not reporting them for tax purposes. Even that is virtually gone thanks to everything being on credit cards lately.

So with all this comes the trend: no tipping, and all employees share in a pre-set surcharge disclosed before you order. Of course the key is incentizing servers to go that extra mile. One assumes as with any place of employment, the bosses will see who is doing well and who is not, and make changes as necessary. This makes sense to me. I’ve always wondered why we tip some people who assist us, like restaurant servers, but not others, like gas pumping guys or someone checking you in at the airport. So you go no tipping people!