There’s just about zero downside to the decision-maker (whatever their title) enabling tipping on the POS terminal unless the nature of what they sell is utterly inappropriate for tipping.
My local Mom n Pop ice cream store where the only staffers are the owners? Tips enabled. The local Mom n Pop hardware store with hourly clerks and absentee owners? Nope.
What I suspect is that @elbows’s explanation used to be fairly accurate, back when more people used cash to pay at places like Subway and Starbucks, and when coins were a bit less insignificant. And that, therefore, customers got used to seeing a tip jar there and at least having the option to toss in something for the person who made their sandwich or coffee. And that, therefore, those self-service pinpads were programmed with an option to tip, for the sake of customers who had become accustomed to want or expect to do so.
There’s a nice Italian restaurant near us that has great food, but for a long time had a credit card system that did mot allow tips! It would freak people out who didn’t carry cash.
I would always make sure to carry some ones, fives, and tens in anticipation. On our most recent visit they’d updated the system to one that allowed tipping, but I always wondered why they used the old system for so long.
This tipping automatically is for the birds. I had a job that society didn’t seem tip-worthy.
I kind of saw it during Covid when volume was down and tips could help. But they don’t seem to have disabled them. The worst was a local place where we were trying to order takeout on line. Very hard to do, and when we finally made it we found there was a 15% minimum tip with no option for less or none. So, they didn’t get our business.
The main point is someone has set up the system -not necessarily the owner. I’ve seen a lot of otherwise smart people who are baffled by software. They accept the defaults wherever possible and only learn the basics they absolutely need, like menu item input.
As for 'why stick with an old system?" for example, Windows XP has been obsolete for years, yet I’ve seen software running on it - the disruption to change to the new version (plus the cost of the new software and hardware) can be a deterrrent. I recall the McD’s near me changing to Windows from a DOS based program around 2000 - it got to the point where their terminals, essentially touch screens built from a laptop - regularly needed new 40MB(!) hard drives, so they would buy 1GB and format the first partition to 40MB. I recall seeing the text-based (DOS?) Squirrel software in other restaurants well into the 2000’s. (What astounds me is even a restaurant system with no tip option - maybe it was just a cash register program?)
One point about cash tipping, in most places tips are pooled and recorded by management so they count as taxable income. So leaving cash so the servers don’t have to report it doesn’t really work, The pooling prevents servers from pocketing cash tips through peer pressure. Some places may require personnel lock up their belonging before a shift so any cash they are carrying at the end of a shift must be tips or actually belonged in the cash register. Smaller establishments may not do this at all but even then in order to avoid notice they’ll still report a reasonable amount of tips. If you see a tip jar then there’s a greater chance those tips aren’t reported. Management can easily disavow knowledge of their existence and the tax authorities have bigger fish to fry.
I must frequent the outliers then.
ETA: my daughter’s first job was waitressing at a small local spot. I went in and had a coffee. It was eighty cents. I left a twenty when I was done, then left. She told me that night that they pooled their tips. I haven’t come across that since.
‘Most’ may not be right because of the large number of very small places that may not do this, but of the commercials chains and large sit-down restaurants it’s pretty common.
I have yet to meet any waiter IN A TABLE SERVICE RESTAURANT that pooled tips mandatorily. The wait staff might chip in a portion of their tips into a jar nor the bussers, host and cooks.
I have never worked in a restaurant but my wife and sister were waitresses and my brothers were busboy and dishwasher. Now I have nieces and nephews similarly situated.
That was my wife’s experience. The servers kept their own tips, but put 2% of total bill into a pool for the kitchen staff etc. (so 20% to 15% of their tips based on 10% to 15% tips in that time). This discouraged cheating about tip amounts, encouraged good friendly service, etc.
Occasionally the managment would comp a few items off a bill after a customer had left, to provide a tip for the server - some people (some ethnic groups) were simply not tippers.
Yeah, that tip pooling thing, is not done in restaurants around here. You wouldn’t get any good servers. Kickback based on % of sales to kitchen staff or owners is common.
And of course, by necessity, catering and hotel functions are a type of tip pooling.
Even within the USA, where tipping in restaurants is definitely a universal thing, I would not be surprised to find that pooling, reporting, and other features of tip management vary a lot regionally. Pooling X%, or Y%, or not, is just how things are done here in [insert major metro area].
I’d also expect it to differ a lot between e.g. Applebees & TGIFridays which are national corporate chains vs. some random Bob’s Generic Sit Down Eatin’, or even a local chain with 2 or 6 locations.
When I first moved to Las Vegas the casino dealers’ tips were not tracked, and substantially never reported to IRS by any individual dealer. A consipracy of silence so to speak.
Not long afterwards a major flail erupted over some audits and IRS laid down the law; henceforth tips would be recorded and reported to management who would report them to IRS. On pain of the casinos footing the bill for any unpaid taxes. After a painfully thorough audit of their books. A clear shakedown by the Feds.
The casinos told the dealers to comply or else, fired up their powerful eye-in-the-sky security mechanisms, and suddenly the volume of tips occurring in Las Vegas was >100x what it was last year.
It produced a mini-recession in all the other local businesses when suddenly all those well-paid casino personnel took hefty pay cuts.
My next door neighbor’s net take home went down ~30%. Untaxed cash tips had been a huge part of their total compensation. As Inspector Clouseau so memorably said: “Not anymore.”
Must be. I heard of it mostly after the feds started cracking down on tips as income. Small places, no, but seems any place with more than one server on a shift would do it.
As I said earlier, Revenue Canada does not require employers to track tips and/or report them as income, collect tax etc. Servers are expected to report them to tax authorities on the honor system. I recall back in the 90’s some stories about RC doing the occasional “blitz” of a town, monitoring and estimating tip amounts and dinging those who failed to report a believable number on previous returns. (So… report a lowball but believable number) In the scheme of things, the effort to chase down one server is probably not worth the cost, especially in today’s job market where much of work tends to be part-time. I imagine if they tried to dump that task on the Canadian employer today, there would be significant pushback. (As I said, that one employer stayed out of the kitchen staff pool admin for that very reason; this was a national chain, so presumably a policy that came from head office).
For sure government (in general, not necessarily yours or mine) loves to outsource enforcement to business and to a less extent individual citizens. All of whom love to push back on that.
The entire magic of VAT is that the enforcement mechanism is totally outsourced to each level in the value chain. By making it valuable / profitable to “rat out” your suppliers, cheating is minimized.
They didn’t have to outsource anything, people did it themselves. Everything electronic is traceable. Every tip you give that way is easy to retrieve, it evolved pretty organically when the Covid came.
People will end up getting taxed on their side hustles much the same way. Cash may see a resurgence though, what with junk fees and multi layer authentications. At some point cash could start looking easier one day.
Yes and no.
VAT does not require you to rat out your supplier. You simply subtract what VAT you paid from what you collected, based on receipts, and remit the difference. If your supplier did not collect VAT, then nothing to deduct, so when you sell, you end up sending the government what they would have collected. A self-healing mechanism. Like anything else, actual lying about amounts paid or collected is a crime.
I don’t know how tips on credit cards are paid out - as I recall, it was once upon a time paid from cash in the register each night. The till system was not designed to track employees and their tip amounts as an accumulating total. i assume that feature has been added particularly in American systems nowadays, considering that often there is not enough cash receipts to pay out tips; a cheque would be issued or it would be added to the regular paycheque. This tracking would be particularly necessary for those regressive jurisdictions where the employer can count tips toward meeting minimum wage obligations.
(It seems some rich politicians are offended by the idea that lowly front line workers might actually make a decent living wage…)
Several years ago, I and my lunch companions asked the manager at a chain restaurant to lower the volume on the TV. He replied that it was set by corporate and he had no control over it. IIRC, he could power it off entirely, but that was forbidden (it ran some sort of dedicated channel, mostly ads for the restaurant interspersed with sports news).
Assuming he was telling the truth, it’s almost certain the staff has no say in the POS software running on the screens.
Note: POS means Point Of Sale, but other definitions are certainly valid.
For some years I carried a little key-chain sized gizmo that was a “mostly universal” remote control. When you pushed it’s mute button it would “play” the IR codes for “mute” for the most common kinds of TVs. About like this:
Worked great in small waiting rooms, but wasn’t powerful enough to reach across a large restaurant. As time went on, the TVs it was programmed for became obsolescent, and it’s pretty useless now.
If I was frequenting places with annoying TVs I’d certainly invest in a fresh version.