I recently overheard a conversation about whether or not one should tip if the service received is “just ok” instead of “exceptional.” My immediate reaction was to shout “Yes! You should always tip!” While I did not do this (mostly because I do not enjoy getting asked to leave restaurants for shouting at strangers), I did start asking non-strangers for their opinion. I was surprised at the amount of people who said they won’t tip, or won’t tip more than a small percentage, unless they have exemplary service. The most common reason given, in my admittedly non-scientific survey was that tips are meant to thank an employee for doing well, not to compensate them for their work.
No one knows the exact origin of tipping though we know the practice is nowhere near new. Steve Dublanica, in his book on the subject, Keep the Change, states “In the West, the earliest examples of tipping demonstrated a form of ‘trickle-down economics,’ with the aristocracy passing money down to the lower classes…by…1530s, visitors to private homes in England had gotten into the habit of tipping their hosts’ servants in exchange for services above and beyond their normal duties.” This practice, known at the time as giving vails, came to America after the Civil War and was widespread by the end of the 19th century. “But it was when employers discovered that they could use gratuities to pay their workers lower or even no wages at all that tipping really took off.” Dublanica goes on to explain that though tipping was a contentious issue in the early 20th century, even to the point of being branded un-American, it remained an integral part of the American service industry. It even became common practice for employers pay a lower amount to tip-eligible employees since it was expected that they would make up the difference – or even more – in gratuity.
Today tipped employees often still count on receiving gratuity to stay afloat because of their low hourly wage. According to the Nevada Department of Employment, Training & Rehabilitation, waiters and waitresses in the Silver State make an average of $11.03 per hour. This means that if said employee worked a full 40 hour shift every week for all 52 weeks of the year, he or she would have a gross yearly income of $22,942.40- less than $2,000 a month. Casino dealers, another industry that relies heavily on gratuity here in Nevada, make an average of only $8.39 an hour, less than $1,500 a month or $17,500 a year. Keep in mind that both of these salary averages are pre-tax. According to RentJungle.com, one-bedroom apartments in Las Vegas, rent for an average of $819 monthly. Even if they can find something cheaper, these workers could easily end up spending between 50 and 70 percent of their post-tax income on housing alone leaving little left over for other necessities like food and transportation.
It should be no surprise, given the math above, that PayScale.com’s most recent survey shows both waiters and gaming dealers reporting that over 60 percent of their income comes from tips. Bartenders have it slightly better at 58 percent but these three join exotic dancers as the only jobs where more than 50 percent of their income is earned by gratuity.
So tipping, contrary to popular belief, is no longer a way of saying thank you for a job well done. Rather, it is a way of ensuring that your server (bartender, dealer, etc.) make enough money* to survive. Because of this, I implore you to factor in the cost of gratuity when you’re making your plans to go out on the town.
*You may think that all of this is an argument to raise the minimum wage. You would be correct, but that is a blog for another day.