Name: Top 10 Reasons To Abolish the Tipping System in Restaurants — TopTenzNet
Uploaded: 2016-10-02T00:10:11.000Z
Duration: 8 min 39 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

Top 10 Reasons To Abolish the Tipping System in Restaurants

Basic passive voice

10. Very Few Careers Are Structured Like That

While other jobs do receive tips, not many other professions are as tip based as waiting

tables. There are a lot of jobs that are commission based, but that’s much different than being

paid through tips. Commissions are a structured amount paid out by the company. Tips, on the

other hand, are not structured or guaranteed. It’s just an unwritten rule that it’s

up to the customer to pay the amount they deem necessary. The restaurant doesn’t pay

the staff anything other than their minimum wage.

Imagine if we paid people in all fields that way. Would you want to pay your doctor in

tips? What about a home contractor? It’s unfathomable. So why are people who take orders,

and serve food and drinks that they don’t cook or prepare, paid mostly with tips? It

comes down to the fact that restaurants are notoriously risky businesses. 70% of them

that survive past their first year only stay open for three to five years. Tipping is a

way for the restaurant to minimize risk by not spending money on staff. And if a restaurant

is having a slow period where less money is coming in, it frees owners from the responsibility

When it comes to tax reporting, tips often stay off the books. It’s up to servers to

report how much they make so it can be taxed, but many servers don’t report every cent

they earned. It’s one of the benefits of being a server, although this “perk” is

The problem is a lot of money is going un-taxed. For example, in Canada, $6 billion is left

annually in tips, while in the United States it’s $44 billion. While servers do report

some of their earnings, there’s so much that isn’t reported that in both Canada

and the United States there are task forces just to crack down on the problem. A fixed

income for servers would create more tax revenue, which would be less of a hassle for servers

because they don’t have the taxman tracking them down — and tax agencies wouldn’t

have to put money into fighting the problem.

8. The Price of Dining Out Wouldn’t Be Affected

One argument against getting rid of tipping is that people will be scared off by the high

prices on the menu. Which is ridiculous, because if a restaurant raised their prices by 15-20%

and eliminated tipping, customers would be paying the exact same amount. According to

some studies, a majority of people would actually prefer that servers receive a salary. And

servers receiving salaries isn’t unheard of. In places like Japan and Europe, they

don’t tip servers; all the costs of running a restaurant, including salaries, are factored

A big problem that restaurants deal with is staff turnover. If servers aren’t happy

with their tips, they can look for greener pastures elsewhere. The problem with the tipping

system is that servers can never really be sure how much money they’ll make. So if

they start a job and the tips aren’t at the level they expected, they may quit and

Turnover can reflect poorly on the restaurant, and it’s important to never underestimate

the value of a competent and knowledgeable staff. The more training someone has and the

more comfortable they are doing their job, the better employee they’ll be. Also, if

a restaurant can offer potential servers stability and security, it may be more appealing. Finally,

if a server knows exactly what they’re getting paid, it might attract good servers who are

less stressed out, because they don’t have to worry about making enough tips to survive.

When someone goes out for dinner, one question that’s often asked of the server is “What

do you recommend?” While we hope servers would give an honest answer, as a consumer

you have to realize that it’s in their best interest to suggest the most expensive item

on the menu. After all, they essentially get a 10-30% commission on whatever the diner

If they were receiving a salary instead of a tip based on percentage, they may be more

honest and you could try some new dishes. This would be beneficial to owners as well

— if a person tries the expensive meal and doesn’t like it, they may never come back

to the restaurant. But if they have a less expensive meal they enjoy, it could mean repeat

business. So is it better for an owner to have someone spend extra money on one meal,

or repeat purchases of a less expensive meal?

Since 1991, restaurant owners can pay servers as little as $2.13 per hour if the tips make

up for the rest of the wage. That’s a lot of responsibility placed on the customer,

especially since tips aren’t technically considered mandatory. By keeping the minimum

wage for wait staff so low, people will feel more compelled to leave a tip even if the

It’s also a large burden to place on the wait staff. Let’s say a waitress works at

a terrible steakhouse. The owner is cheap, so they buy terrible cuts of meat. The kitchen

manager takes the steaks and freezes them. A month later, the chef thaws the steaks and

then overcooks them. The waitress, whose only job is to take orders and deliver food and

drinks, brings the overcooked, formerly frozen steak to the customer. The customer is displeased,

quite possibly vocally, to the waitress. At the end of the meal, the customer pays the

bill but doesn’t leave a tip. Everyone who had something to do with the restaurant and

the quality of food gets paid their usual wage and the owner keeps any profit, but the

server is left with only $2.13 from her hourly wage. That’s a major imbalance in responsibility.

An argument that’s made for tipping is that if someone is working for tips, then their

performance earns them that that money. Therefore, if they want a tip, their service better be

top notch. But studies show that the relationship between tipping behavior and the quality of

service isn’t significant. People will leave their standard tip, usually about 15%, no

matter what the service is like. Even if the service is poor, 70% of people still feel

obligated to leave a tip. It’s common knowledge that servers make less than minimum wage,

and by tipping them poorly when you know someone is relying on that money to survive, a lot

of pressure and guilt is placed on the customer.

There are currently only seven American states that require tipped workers to receive the

same minimum wage as other workers. Otherwise, servers receive just $2.13 per hour. There’s

been little change since 1991, even to account for inflation, while people are tipping less

than they used to. The economy has changed drastically since the booming 1990s. So when

people go out for dinner, knowing their own financial situation, and are given the choice

of spending an extra 5% to 30% on a meal, are they going to spend more or less? Due

to the fact that the minimum wage hasn’t changed while tips have decreased, servers

often find themselves living below the poverty line.

Many people don’t change their tipping percentage every time they go out. They generally have

a set percentage, and tip that amount almost every time. Herein lies a problem. Bruce McAdams,

a professor at the University of Guelph’s School of Hotel and Food Administration, gives

an example of going out for a bottle of wine with his wife. They’re celebrating, and

buy a $150 bottle of wine. The waiter opens the wine and leaves it at their table, and

they’ll pay him a 15% tip, which is $22.50. At the table next to them, another couple

Subtitles ListPlay Video

Top 10 Reasons To Abolish the Tipping System in Restaurants — TopTenzNet

people

tip

amount

tend