In my first post, I said I didn’t think the current system was going to change in the U.S. - THEN, I gave my opinion as to which system, in theory, I thought was better. If you don’t want to argue which is theoretically better, then don’t respond to my posts. But please stop bringing up the red herring of what the status quo is. I’m not disputing the way things are, nor suggesting that there is a lot of pressure to change it. I’m just saying which way I personally think would be better.
$100 a night translates into $12.50 an hour for a full shift. That’s not a particularly high hourly wage. If there were a no-tipping system, owners could charge more for the food or drinks, and pay the servers $12.50 an hour. I work in a field where there is no tipping, and I make more than $12.50 an hour, and the universe hasn’t imploded yet. Now as for the $200 or $300 figures you mention, you say those are only on certain nights. If you were paid a higher salary, it could average out over the course of a week to be the same amount of money. There’s really no inherent reason why one way is better than the other. The only reason it would be difficult to do it in this country is because the tipping system is in place, and people would resist the change. You believe it’s better for you because you can’t conceive of being paid a higher salary, like, say $25 an hour, since it’s never been done that way in your experience. That doesn’t mean it couldn’t be done that way. In addition, it wouldn’t hurt the restaurants, because they would all raise their prices, and the relative competition would be the same. It wouldn’t hurt the customers, because they would simply pay more up front, rather than a lower price plus a tip. It would even out in the end. The only difference would be more fairness and more convenience for everyone.
I don’t think you have demonstrated that in any way.
In this thread, we have one server who said it’s unfair, and one (you) who said it’s not. Wierddave admitted that he would work for no tips if the salary were high enough. So I would ask you to demonstrate how, other than yourself, the vast majority of servers feel that the tipping system is fair and/or the best way to do things?
We’re way past the original premise.
I don’t think you have proven that at all. I am a customer, and I think it would be better.
My point was that it’s not a particularly reliable system in terms of rewarding good performance. You may be right, servers may not be in favor of getting rid of tips, because they may not be able to conceive of the possibility of commanding a higher salary from the employer. If you think of it in the simplistic terms of “Gee, I’m not getting that extra money”, of course it seems bad. But that wasn’t the point I made. You are misconstruing my argument. I never said I want to “save” servers, I simply made one argument, among many others, as to why a tipping system is inferior to a no-tipping system.
Sorry, but I’m not going to repeat exact same arguments over and over. You’re just going to have to go back and read.
And once again, I never said I’m trying to “help” anyone.
Not if they would make as much or more with the straight salary.
I doubt you speak for all servers. I’d be willing to bet that servers HATE being stiffed because of the cook or the manager’s screw-up.
Of course they could. They could just charge more up front, and bring in the same amount of money. What’s the difference, from the customer stand-point, between paying more for the meal, or paying less plus a tip, if the total amount of money spent is the same?
A few points here. In countries where tipping is not standard practice, food and beverage costs are not outlandishly different than they are here. This goes for countries with good exchange rates too. Also, tipping or not tipping would not change customer service that much. Managers can and will fire people if enough people complain. If they don’t complain, and the server can get by with meager tipping, then he or she continues to do so. Almost everyone I know has particular servers at particular restaurants that they don’t want to serve them. And when has tipping a cab driver or bell hop ever changed what they do, just whether or not they say thank you. The problem with the system is that if you are in a group, and people in the group are stiffs, then either a)you get to make up the slack, b)the waiter gets stiffed, or c)you’re at an establishment that automatically charges you 15-18% for parties larger than 6. Waiters do remember people who tip poorly (and groups) and give them maybe not worse service, but perhaps less prompt service.
Just wanted to clarify something, because I can see someone misconstruing what I said here. There were 3 examples used: $100 a night, $200 a night, and $300 a night. The $12.50 figure I mentioned would only apply to the $100 a night example. If you make $200 a night, that would be equivalent to $25 an hour, of course. And if you make a different amount each night, you’d have to average it over the course of a week to figure out what an equivalent hourly wage would be. Just wanted to clarify that before anyone says, “But gee, Blowero, you said $12.50, you did, uh huh, uh huh.”
I kinda doubt most servers are consistently making $300 every night. That’d be $78,000 a year. If you are making that kind of bread as a waiter/waitress, good for you, but frankly, you’re overpaid. I have the utmost respect for servers, and I know it’s a difficult job, but c’mon…
Reality math check here…
Most servers, and in my experience never, worked an 8 hour shift. Servers are staggered and the average work night was around 5-5½ hours. Occasionally it was 7 hours. The average, however, was not 8 hours and was consistently closer to 6 hours or less. Some servers worked longer, some shorter. “Closers” often worked the latest, but also came in the latest. As both a manager and a former waiter, 8 hours was not the norm for front of the house staff.
Taking that a step further, ethically right or wrong, that $100 is only partly taxable. Most servers, in my experience, under-report tip income. (The same as cabbies, shoe shine men, caddies, car parkers, doorman, etc)
On a 6 hour average that $100 works out to $16.67, and that’s before the “benefits” of under-reporting are taken into consideration. (After all, if all of the server’s income were reportable their tax burdens would be substantially higher.) Let’s assume servers under-report ½ of their tip income. That will have the effect of raising *effective *net income by something on the order of 25% or more. You’re now looking at a job that pays something along the lines of $21.00/hr. Add to that the wages that the “house” pays, which is another $4 or $5 dollars and you’ve got a pretty decent job.
And that’s at $100/night. You don’t have to work at The Rainbow Room to make more than $100/night. The suburbs are full of waitwers who will leave T.G.I.Friday’s tonight with at least that much, and more than that tomorrow night. (Friday/Saturday nights)
Your math doesn’t begin to reflect the economics of how servers are compensated. If you actually think that the average server in a resaurant like Chili’s, Bennigan’s, Macoroni Grill, Friday’s, etc are actually making $12.50/hr you’re sadly mistaken. they were making more than that when I left the business 14 years ago. Do you think Weirddave was making that number up? Good servers, in even a decent restaurant make considerably more than $12.50 after all things are considered. That’s why I believe you’d be hard pressed to find servers who would go for your scheme, even at $15 or more. It would be a pay cut!
That’s just the beginning. The actual payroll cost of a sever in a decent restaurant would more than triple, and in fine dining restaurants would go up closer to 5 times. On top of that the restaurant would incur additional payroll costs like FICA,FUTA,SUI and other taxes. Your $3.75 Heineken is not $8.50. But don’t worry! You don’t have to face the withering pressure of figuring out what to tip.
Actually I don’t want to argue at all. And, i can appreciate that you like non-tipping better.
But with all due respect, the primary reason (if I recall correctly) for changing the system is that it’s unfair, and that it is racist.
I just don’t think that case has been made in the slightest.
I don’t mean to be disrespectful, but I’m getting a sense you’re either inexperienced in business matters or very young or both. The restaurant industry doesn’t fear other restaurants or competition on this issue. They fear Winn Dixie, Piggly Wiggly, Kroger, WalMart and Safeway.
Their feeling is that at some point it becomes cost prohibitive to eat out and people stop eating out or eat out much less and stay home and eat instead. They fear you simply going to the grocery store and eating in.
If all costs were reflected, including much higher payroll taxes, on the menu the cost of your meal would go up. How much is open to debate. I do know the math though, and I did review the P&L statement for these type of businesses. Many of them walk a fine line of profitability.
Oh well…I tried.
But, if you’re game and eat out at any middle-of-the-road restaurants like TGIFriday’s ask your server if they’d prefer a no-tipping policy, and more importantly, what the salary would need to be for them to support. I guarantee that it will be higher than $12.50.
Well, a scientific poll is impractical, but I’m certain that the vast majority of servers would balk at a no tip policy, and to sign on would require (like Weirddave )something closer to $25 then $12.50 before they’d support it.
Well…you’re not a former server or manager yet you know that “it’s not a particularly reliable system in terms of rewarding good performance.” On what basis are patrons tipping then? Overall, it is a good system in terms of rewarding or penalizing for good/poor service. Certainly, in my experience, good waiters made the best money (by far) and the poor ones made much less money. (while they were still with us…)
They’re generally a pretty bright group of people. I’m sure they conceived it.
The argument, if I recall, is that it is unfair. I never felt that way as a server, and never heard anyone ever say it.
Good. But if you were able to make this change it might be you who would need some help…
They’d make** less.**
Absolutely no doubt about it.
Not as much as they’d HATE being paid $12/hr for a job they previously made twice as much for.
The discussion of salary versus tips, and the idea that the price of food would increase by merely the amount typically given in tips misses a fairly important point.
Running a restaurant or bar is a surprisingly difficult way to make a buck. There is a significant amount of capital investment, kitchen staff (particularly cooks) is difficult to find and retain (and, from the stories I’ve been told, notoriously temperamental) ; attracting and retaining customers is problematic even if the best practices are followed, CoGs are high, regulations reasonably strict (with good reason, obviously). It is a tough business, believe it or not, although if it works a decent amount of money can be made. This is not to say it is the most difficult business or that the problems are insurmountable, merely that there are risks that those not familiar with the business of running a bar or restaurant may not see.
The most deadly, of course, is the idea of an empty bar.* Profit margins on items sold are pretty high, but if no one is in drinking, or if the place is empty a few times a week, fixed costs will cause it close. By my estimate, roughly 50% of an average small bars fixed costs are salary.
How does this relate to tipping? Tipping moves the risk of people not being there from the owner (who has already put up considerable money) to the server. By paying minimum wage and having the wait staff work effectively on commission, the owner cuts costs and transfers the risk of a dead bar to the server. Obviously, anyone familiar with economics (and it has been my experience that wait staff understand economics at a visceral level) would realize that the person assuming more risks does so believing the potential for reward not experienced if the risk hadn’t been assumed. Put more simply, I was willing to put up with the potential for a dead bar knowing that by doing my job well I was likely to have a lively bar. Furthermore, given the manner in which bar staff is recruited and promotions are given, I was content to experience the drudgery of dead day shifts knowing that I would get coveted weekend night shifts if I did a good job (and I did) and that I could, with experience in this bar, find a better and higher-tipping job elsewhere (which didn’t sound like fun by the time I could).
In order to compensate adequately, the owner would have to assume both the risk, and therefore the risk premium, as well as the direct cost of paying the server more money and price that in accordingly; the risk premium would increase the price of the meal by more than the standard 15~20% tip; a dead bar has a larger impact on the owner than it does on the bartender, if only because the owner has more to lose (see the comments about substantial capital investment above). This is especially hard on new bars, which tend to exist in a slightly more precarious cash-flow situation. This could be alleviated by tacking on a tip in advance, and putting the server in a direct commission situation, thus transferring the risk back to the server. This has significant downsides to it as well, but not ones I can cover at this point.
Either tipping or commissions provide an important direct incentive. By comparing the take of bartenders working on the same nights at the same place, and talking to other bartenders about it, I figure that the difference between a good bartender and a bad one is probably between 10 and 20% difference in sales for a shift (I believe the sales difference is even higher in restaurants). Tips are best measured as a percentage of the till, and really, a bad bartender doesn’t make that much less of a percentage than does a good one, in my admittedly limited experience; that is, I was one of the better bartenders, pulling north of 20% of sales for my shift, while the least-liked brother of the owner and thus unfireable bartender tended to make just under 20%. Working the same shift, though, I made more money; my till count was consistently 20% higher than his, and frequently more. As a result, even if it is true that people consistently tip the same amount (which is only moderately true in my humble experience), there is still incentive to provide a good service, in order to increase sales. I have been asked who was working when, and provided fairly direct opinions of the desirability of drinking at that place during X or Ys shift. I have seen people leave a bar when the new server shows up, and I’ve even seen people wait for the new server before ordering a drink.
While I believe my premise (that transferring the risk back to the owner would increase the price of the food more than the current amount plus the tip) is simple enough (although I expect an economist to come along any minute and rip me apart), my point is more that the tipping system exists for non-obvious reasons, and that changing it, while possible, may be more problematic than simply “well, pay them X dollars an hour more and they’ll be happy”. Good economic reasons exist for the system in place now, and modifying the situation may have consequences that are difficult to foresee.
Many people have commented that good service exists in countries where there is no tipping. I am only familiar with France, where tipping is minimal, and a compliment rather than a requirement. I may well be incorrect, but it seems that in France, wait staff have a certain social respect that does not exist in the States. In the States, bartending, and even more so, waiting tables, is considered a low-end, dead-end, unskilled job. The lack of respect is made up for by, well, greater compensation**. My point is only that when comparing service industries across countries, it might be best to recognize the existence of other variables.
My numbers are in LA dollars, which obviously aren’t as valuable as dollars in other parts of the country, but $100 is a bad night, even at a small neighborhood bar; it should also be noted that that’s an additional $12.50 on top of the current minimum wage. Additionally, of course, one pays only income tax on tips; tack on another 14.2% for SS and medicare when counting the increase to the cost of food. In LA, a good server at a decent bar will clear well over $400 on three or four nights. The A-list bartenders at Brennan’s on Main and Pier do, in fact, make considerably more than $78,000 a year. I cannot begin to imagine what the bartender at the Abby (on Robertson and Santa Monica) might make; those $9 martinis flow pretty fast, and gay guys tend, in aggregate, to tip well. I would humbly suggest that until you’ve 1) tried to get such a job and 2) walked a plank for a while, you may not have sufficent experience with the field to judge what people “should” be making.
Pizzabrat, if I can make a suggestion: while it may be true, and certainly unfair, that people are evaluated based on what the server thinks is likely to be the tip, being a decent human being counts for far more than the tip at the end of the meal. I was certainly more inclined to say “well, he doesn’t tip well, but he’s easy to get along with” than “yeah, he’s an asshole, but that extra 5% really made up for it”. This is not to suggest that you are anything other than a decent human being, but rather to attempt to allay your concerns about being judged on the likelihood of a tip. Be cool, and if the waitstaff is a jerk for no readily apparent reason, then they are the jerk, AND you can reduce the tip accordingly.
Miss Manners Saves Civilization covers tipping, as does and “Let’s go USA” book. You might google for “tipping etiquette “miss manners”” if you wish a few other pointers. There appears to be a tipping.org that might help as well. However, tip 15% for average, 20% for good, 12.5% for bad; save the one cent trick for REALLY BAD service, and relax. Oh, and as an aside, one can ask the serviceman, although one must recognize a certain diplomacy and a little common sense; I would give an honest evaluation of the appropriate gratuity.
(on preview, it appears the raindog covered this better than I can, so if I said anything stupid, take it up with him)
• or restaurant, but my experience is in running a bar, although I have friends who have run or been highly placed in restaurants.
I agree with you. It is apparent that you understand the economics of the restaurant business. For those who are not experienced with it—and that goes for not just the economics of the server, but the precarious ecomomics of many owners—it is simply not as easy as transferring the 20% tip to the bill and/or menu and calling it even.
It is more complicated than that. Servers do in fact make substantially more than $12/hr in most restaurants and in the higher end/more popular restaurants/bars they can make outstanding money. It’s just not feasible to simply transfer those costs to the menu—in part because payroll taxes and other costs come into play as well. Your point that they take on semi fixed costs qualities is apropos.
I am sympathetic to blowero’s opinion, and conceptually agree that it would streamline the dining experience. But I think it would be a cause of anger and resentment for servers, customers and owners alike. It’s just not the best method.
bashere said:
Ironically, by I got to this point I was actually thinking that it was you that said it better. (And not just because I agree with you)
No, you don’t recall correctly. I haven’t touched the racism issue AT ALL, and if you’ll go back and read all my posts in order, you’ll see that the “fairness” issue was secondary, and actually was only an afterthought - certainly not my main point. The only reason it’s received so much attention in this thread is because YOU keep harping on it.
That’s inane. Apparently you are incapable of arguing without being condescending. How sad for you.
An irrational fear, IMO. The entire population of the United States isn’t all of a sudden going to stop going out.
I understand that management is strongly motivated to keep the status quo, because it allows them to pay their staff very low salaries, and have artificially low menu prices. That doesn’t necessarily mean that system is better.
Wow, that’s amazing. Even after I took such pains to write this:
You STILL pretty much said, “Gee Blowero, you said $12.50”.
Between that and your ad hominems, I think I’ve wasted enough time with you.:rolleyes:
That’s a very good point. However, your implication that “anyone familiar with economics” must conclude that a tipping system is the only way that will work, misses the obvious fact that other countries that also have free-market economies do successfully employ a no-tipping system.
I took great pains to express my utmost respect for the job that servers do, and never implied that they didn’t deserve to make an honest living. So your arrogant posturing here is completely out of line. That kind of garbage belongs in The Pit.
Uh, you’re kidding right? Your previous post was at 6:27 pm yesterday local time here, and my response was 11:44 am today. Some of us go out in the evening, and don’t spend all night sitting at the computer. If you have that much of a burning desire to get in the last word, go ahead - you don’t have to come up with some ridiculous pretext for posting. :rolleyes:
I make a passing mention of that in my post, when I point out that you are correct, other countries do so. My point isn’t that this is the only way it can be done, but only that increasing pre-adding the tip to the bill (putting servers on commission, effectively) will increase the amount of teh bill by more than the tip would. This may be completely acceptable, but I am attempting to give a reason that a $10 tab would become more than a $12 tab if the server were paid a salary commensurate with the take they currently experience.
While I certainly appreciate your references to the “fine job servers do”, you made a comment that if they were making more than some amount, frankly, they are over paid. I am curious what criteria you used to determine the correct level of pay for a server.
Notwithstanding the meaning of this thread, but there is a vast discrepency what people should be paid and what they are paid. As an EMT in a level 2 ER, I was making $7.67 with shift difference. Doing CPR. Possibly on your grandmother, certainly on somebody’s grandmother every other night or so. So, do I feel that the person with the 17 pieces of flair deserves $12.50 or $25 or whatever number we come up with that they make per hour? Some of them are trying to make a living, others are working their way through college. That’s why it’s so easy to get wait jobs during the summer in college towns. (And why it’s so hard to get good service at the same time, natch). I’m sure the balance shifts to the long term employee’s the higher the cost of the food gets, since I rarely get wine stewards at TGI Fridays. If people weren’t getting paid what they thought after tipping became outlawed, then likely they would move on. Or get tipped under the table at expensive places, sort of like concierges.
Good point, but of course off point of the OP. That is something that has always perplexed me. In urban areas bond levies, which are simply tax instruments for the benefit of schools, are routinely rejected by the voters. Schools are forever begging for money to operate. (the typical levy adds some nominal amount to property taxes)
Yet, if a major league team wants to move, the citizens approve much larger amounts to build stadiums and such. (and sports teams are private enterprises!) I can’t figure it out. Why does a policeman or schoolteacher (two of the most noble and valuable professions IMO) make less then a second string shortstop? Why are voters unwilling tp pay an additional $150/year for their local schools but several times that for a sports stadium, just so they can overpay to attend the games and pay $6 for a beer?
There is certainlt some large discrepancies between professions that are hard to understand. In it’s purest sense one might simply say, "That’s how the marketplace (or citizenry) value each of those jobs. That’s probably true. But it’s a sad commentary on our value system.
(Bolding mine.) Source: http://www.dol.gov/elaws/faq/esa/flsa/002.htm
In short, the minimum wage for covered, nonexempt employees is $5.15/hours. In those industries where tipping is the norm, the $5.15/hour comes from the employer ($2.13/hour) and the customer (remainder), with the employer making up the difference if the customer does not.
As pointed out by Jane D’oh!, this system favors the employer. I’m betting most tipped employees don’t know the law and are not paid the $5.15/hour (total) as required by law. Even so, unless there is some sort of employee representation to protect themselves (a union?), if you make a stink about not being paid what the law requires, you will shortly be out of a job. I seriously doubt the vast majority have the resources to fight such a dismissal.
Now as for the $200 or $300 figures you mention, you say those are only on certain nights. If you were paid a higher salary, it could average out over the course of a week to be the same amount of money. There’s really no inherent reason why one way is better than the other. The only reason it would be difficult to do it in this country is because the tipping system is in place, and people would resist the change. You believe it’s better for you because you can’t conceive of being paid a higher salary, like, say $25 an hour, since it’s never been done that way in your experience. That doesn’t mean it couldn’t be done that way. In addition, it wouldn’t hurt the restaurants, because they would all raise their prices, and the relative competition would be the same. It wouldn’t hurt the customers, because they would simply pay more up front, rather than a lower price plus a tip. It would even out in the end. The only difference would be more fairness and more convenience for everyone.