What’s wrong with the tipping system in the US?
Tipping in the US is a given; a part of the service culture and economy. On the surface, tipping is viewed as a way of rewarding and incentivising workers in the service industry, as well as a way of redistributing wealth. In reality, the quality of service has a minimal impact on the size of the tip, according to Michael Lynn (Cornell scholar). Cheque size is the most important factor contributing to tips. The more ordered, the bigger tips received. This is not to say don’t tip your servers- we must tip generously and equally! We should also become aware of the social issues the gratuity system fuels. The American-style tipping system has roots in slavery. After the Civil War, newly freed enslaved people received a $0 wage with employers promising tips as compensation.
Currently, the federal tipped minimum wage (for workers with jobs that can expect more than $30 per month in tips from customers) is $2.13 an hour. The US Department of Labor states that if the minimum tipped wage and tips the worker receives don’t add up to the federal minimum hourly wage, it is the responsibility of the employer to “make up the difference.” However, a study of more than 9,000 restaurants by DOL revealed that 84% of restaurants had a minimum wage violation where employees made less than non-tipped minimum wage. The federal minimum wage for non-tipped workers has increased by 70.6%, while the tipped federal minimum wage for tipped workers has stayed the same since 1991. 17% of low-income employees in the US are victims of this “wage theft”. This is one of the reasons tipped workers are double as likely to live in poverty.
People of colour, women, and especially women of colour are severely hurt by this system. This has been heightened by the pandemic. 70% of the tip-dependent workforce are women, despite accounting for 51% of the US population.
Many female servers are harassed by male customers using their tips as leverage. From 2005–2015, accommodation and food service employees made up 1/7 of sexual harassment charges. Latinas are roughly 2x as likely to be tipped workers than white men. Additionally, tipped Black women are less likely to work in “upscale” restaurants where tips are higher and receive $5.00 less per hour than tipped white men. Furthermore, POC make up 47% of tipped casual dining restaurant-workers, but only 32% of fine-dining restaurant-workers. In the transport industry, Black taxi drivers in New Haven were tipped roughly ⅓ less than white taxi drivers in 2005.
As always, we must remember intersectionality. The need for system change is pressing.