Economics, Business, Money, Finance : Pushing back on "the tip creep"

Pushing back on "the tip creep"

Americans push back against ‘tip creep’ — ‘It’s time to take a stand,’ expert says
From self-service fast-food restaurant kiosks to smartphone delivery apps, there are more opportunities to tip for a wider range of services than ever before.

But between the high cost of living and uncertain economy, cash-strapped consumers are starting to tip less — and resent tipping prompts even more.

Fewer consumers now say they “always” tip when dining out compared with last year, according to a new report by Bankrate, or for other services, such as ride-shares, haircuts, food delivery, housekeeping and home repairs.

“Inflation and general economic unease seem to be making Americans stingier with their tipping habits, yet we’re confronted with more invitations to tip than ever,” said Ted Rossman, Bankrate’s senior industry analyst.

Many feel the pressure to tip has increased over the last year, NerdWallet’s consumer budgeting report also found.

However, two-thirds of Americans have a negative view about tipping, according to Bankrate, particularly when it comes to contactless and digital payment prompts with pre-determined options that can range between 15% and 35% for each transaction.

“Now you have to go out of your way to not tip and that’s what a lot of people resent,” Rossman said.
Tipping 20% at a sit-down restaurant is still the standard, etiquette experts say. But there’s less consensus about gratuity for a carryout coffee or other transactions that didn’t involve a tip at all in the past.

While tipping at full-service restaurants has held steady, tips at quick-service restaurants by guests fell to a five-year low of 16.7% in the first quarter of 2023, according to Toast’s most recent restaurant trends report.

“Part of it is tip fatigue,” said Eric Plam, founder and CEO of San Francisco-based startup Uptip, which aims to facilitate cashless tipping.

“During Covid, everyone was shell shocked and feeling generous,” Plam said.

“The problem is that it reached a new standard that we all couldn’t really live with,” he added, particularly when it comes to tipping prompts at a wider range of establishments, a trend also referred to as “tip creep.”

“Now we are inventing new scenarios where tipping should occur.”
Yet, since transactions are increasingly cashless, having a method to tip workers in the service industry earning minimum or less than minimum wage is critical, Plam added.

In fact, the average wage for fast-food and counter workers is $14.34 an hour for full-time staff and $12.14 for part-time employees, including tips, according to the most recent data from the U.S. Bureau of Labor Statistics.

“People should know that the livelihood of that person is largely based on how much tipping happens,” Plam said.

In other cases where workers don’t rely on gratuity for income, “we, as consumers, should use our own judgment.”

That doesn’t mean consumers need to necessarily tip less, Plam added, but “think about whether that person improved your experience.”

“It’s time to take a stand,” he said.

https://www.cnbc.com/2023/06/08/americans-have-tip-fatigue-resent-tip-creep.html

Re: Pushing back on "the tip creep"

Just the tip creep 💦💦 oh good grief!

Re: Pushing back on "the tip creep"

"The Tip Creep" does sound like the name of a perv committing unwanted acts of contact.

Re: Pushing back on "the tip creep"

Pushing back on the tip 💦💦 oh good grief!

Re: Pushing back on "the tip creep"

😂

Re: Pushing back on "the tip creep"

if i order takeout i still tip $2 unless it’s a place i frequent a lot i tip $4

if i’m dining in then i always tip at least 10-15% depending on the service/food/time of day

Re: Pushing back on "the tip creep"

Is 10-15% the typical tip there for restaurant servers? I think the average is 15-20% in the US.

Re: Pushing back on "the tip creep"

do servers make under min wage in the US ?

Re: Pushing back on "the tip creep"

Some used to make a few dollars an hour or less, because the rest was made up with tips (and the employer had to make up the rest if the servers didn't make minimum wage).

But since a lot of servers quit during the pandemic, many restaurants started offering $15 an hour for servers. And higher-end restaurants were probably already paying more.

It depends on the location, though. Here's an example for New York:

New York State law allows employers in all industries other than building service to satisfy the minimum wage by combining a “cash wage” paid by the employer with a credit or allowance for tips that the employee receives from customers. For example, the minimum wage for food service workers in New York City is $15.00 per hour. Their employers can satisfy the minimum wage by combining a cash wage of at least $10.00 with a tip allowance of no more than $5.00 per hour.

Re: Pushing back on "the tip creep"

Re: Pushing back on "the tip creep"

Which movie is that from?

Yeah, it's really getting out of hand. Supermarket cashiers will have tip jars soon.

And the concept makes no sense; at a restaurant, if you choose an entree that's $26 instead of one that's $14 (for example), the expected tip is higher, even though the service is the same.

Re: Pushing back on "the tip creep"

I believe it is from The Petrified Forest (1936)… but, there were a few other classic movies I've seen from that era that captured that sign. In any case, it was discussed in this thread on TPF board:

https://www.filmboards.com/board/t/Tipping-is-Un-American.-Keep-your-change.-1919686/

Re: Pushing back on "the tip creep"

Yeah, I'd like to see that sign in real life, lol.

I've heard about some restaurants (in the US) that actually do have signs saying not to tip because they pay their servers a good wage, but I've never seen that.

Re: Pushing back on "the tip creep"

Reminds me a bit of what the Leper said to the prostitute keep the tip :D

Light travels faster than sound. That's why people seem bright, until you hear them.

Re: Pushing back on "the tip creep"

Eew, lol.

Re: Pushing back on "the tip creep"

Tipping isn't a 'thing' in New Zealand. Nobody expects it at all.

Re: Pushing back on "the tip creep"

That's the way it should be. Here in the States, for a lot of people it's getting to be a routine aggravation.

Re: Pushing back on "the tip creep"

I've heard that before!

I came across this article a while back, where people were "outraged" that Domino's was trying to bring tipping culture to New Zealand:

Domino’s is under fire after adding a tipping feature to its online ordering system, with critics saying the pizza chain should “pay staff properly” instead of relying on customer generosity.

But Domino's says the system helps keep its workers safe and there is no obligation to tip.

The new feature gives customers the option to pay a fixed amount or choose their own tip for their “delivery expert” before completing payment.

The move has been met with outrage on social media, where some have said Domino’s should “pay staff properly instead”.

A Reddit post accusing the company of “trying to bring tipping culture to New Zealand” has received more than 1500 comments since Friday.

“Pay your staff properly instead please,” the original post was captioned and responses labelled the feature “gross”, “vile” and “toxic”.

Many comments said tipping, which is common practice in the United States, didn’t belong in New Zealand.

American here who dearly misses living in NZ, do not let the dumpster fire of tipping culture seep beyond our borders. Everyone who isn’t a CEO hates it, nothing good comes from it, and like a metastatic cancer it is nearly impossible to get rid of,” one wrote.

“I will absolutely support if they need to unionise and strike for proper wages but I will never ever buy into this tipping culture bulls…. It is on the employers to be paying their staff properly, not the consumers.

“This feels gross, not just because I despise tip culture, but also because it feels like another KPI metric to live up to,” another said.

Others objected to the tip being applied before the delivery was completed, when they had no way of knowing if the service would warrant a top-up.

“I learned my lesson with pre tipping like that: the delivery driver decided that since I already paid them I would get delivered to last so the people who didn’t already tip would get their food first and tip for quick service. Low [sic] and behold an hour and a half later I got my lukewarm pizza.”

A Domino’s spokeswoman said the feature had been rolling out at selected stores over the past couple of weeks.

Customers sometimes wanted to acknowledge their driver’s work by offering a monetary tip, she said.

“With the ongoing need to practice social distancing, many customers have been unsure of offering a tip in person,” she said.

“To facilitate this in the safest way possible during Covid-19, we have introduced a secure and contactless way for customers to tip their driver.”

Customers weren’t obliged to include a tip, but when they did it would be included in the driver’s weekly pay, she said.

https://www.stuff.co.nz/business/122687242/outrage-over-dominos-tip-your-driver-feature

Re: Pushing back on "the tip creep"

I hope NZ remains 'non-tipping' forever.

Re: Pushing back on "the tip creep"

Me too! Maybe your non-tip culture will spread to tip-culture countries someday.

Re: Pushing back on "the tip creep"

If you can afford to eat out, you can afford to tip.
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