The Pros & Cons Of Guilting Guests Into Tipping More

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QUESTION FROM: John in NE

“What do you think about encouraging guests to tip more? I know there are some bars like the one speakeasy you mentioned in Philadelphia that bans people for not tipping or not tipping well and my staff seem to be behind punishing customers who don’t tip but this has been a fact for years. some customers tip, some tip like crazy and some don’t tip at all. What’s with the sudden tip shaming going on?

I keep hearing from other owners, especially hotel owners, who seem to believe that guests should be tipping more $ and more often. A couple that I am friends with owns a hotel and keeps complaining that a very small percentage of their customers tip the maids and that the maids deserve more than their bartenders even though they’re not generally guest-facing.

I realize they clean up messes that noone else wants to and that they have to remove hair from drains but servers, bussers and dishwashers do a lot of work most people wouldn’t want to do too. And my dishwashers deal with some pretty nasty sh#t I’d bet no maid would ever want to even see but we don’t make our customers feel guilty about not tipping our staff more and would never consider asking them to tip our dishwashers.

I always felt like if my staff wasn’t earning a livable wage, I would simply make less profit. I pay my dishwashers $10/hour and some weeks I pay my servers and bartenders a little more in the form of a “bonus” if they work a big party and get stiffed just so they can walk with something. Am I a sucker or should I start addressing customers who don’t tip like this:”

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HH ANSWER:

Tipping is customary, not mandatory.

Many operators run into this frequently. As an owner, you don’t turn away guests (unless you’re a private club or exclusivity is your business model ) but, at the same time, you have to take care of your staff and make it clear that you have their best interests in mind and at heart.

When their tips are less than expected or non-existent, the onus falls on you - not the guest- to ensure they are properly compensated.

Give them a gift card, cash or buy them a meal. Do something...but DON’T vilify the guest. Not in public. Not in private and not to yourself. That’s just a bad move that breeds contempt, entitlement and everything else that is antithetical to the very tenants of hospitality...and if your staff is encouraged to think that way, you’ll have to invest quite a bit of time and money to remove that cancer from your culture.

As I’m sure many understand: paying guest-facing staff a legal tipped wage or as some may say: “appropriately paying staff” effectively makes tipping mandatory for most since labor cost is factored when pricing any items’ (low / affordable) cost.

While I appreciate that reality; I will say it seems we’re all headed (albeit very slowly) in the direction of increased pricing due to the fact that more and more of the public seem to be viewing “standard tipping protocol” as their subsidizing the profits of restaurant & hotel operators who pay their core labor pool (i.e., servers and housekeeping staff) less than a living wage.

Some may argue that the issue of tipping your server or maid “appropriately” is an issue of semantics...or better yet the lesser of two costs: Either good tippers subsidize those guests who don’t tip (or tip poorly) or every guest subsidizes ownership and thus the “financial onus” to support the restaurant or hotel is spread out evenly.

The downside of the latter is that the provision of an amenity costing everyone more, may be less sustainable. In a market with little competition - or in the case of a very unique offering, that could be very bad for those guests who most appreciate that particular service / product being made available to them.

UPDATE 9.4.19 Then there’s the issue of whether or not to prompt guests to tip cashiers. I’ve been responding to quite a few people the past month who are looking for best practices concerning their SOP so updating this reply to include one of the recent questions and my reply:

QUESTION FROM: Barb in MN

“Does anyone have quick service restaurant where tablet POS system does suggestive tips when customers place orders at the counter? What are your thoughts on using that feature? I just got a pretty long email from a customer at 12:03AM telling me about who wrong this is? Like lots of other owners, all of my employees including our cashiers, rely on tips to ensure they earn a living wage which means that when someone tips our cashiers, they’re not only incentivizing employees to perform diligent work, they’re actually supporting my business and the homemade products we offer.

When you think of it, cashiers can make or break the customers experience. They are customer facing, smiling, making eye contact and thanking them for their business.

Thoughts?”

HH ANSWER:

I’m against tipping any cashier (unless they’re performing more than the task of ringing me up and telling me when to insert my card into the reader or making change) and I think asking your guests to tip a cashier (especially in fast food, quick serve or self-service) is a great example of not thinking “guest-first”.

But... if you decide to continue guilting guests into tipping your cashiers for making correct change and smiling - PLEASE consider including a “NO TIP”, “NO THANKS” or “SKIP THE TIP” button that ISN’T smaller or less prevalent in any way than the suggested percentages listed on the screen.

BTW: If I needed to rely on tips to ensure my employees were paid a living wage - I’d increase my prices across the board before I asked any guest to tip someone who simply facilitated a transaction.

The reward or incentive for diligent work of that particular nature is yours to give and, for the record, “service with a smile” should be seen as an integral part of everyone’s job - and not as going “above and beyond”.

Call me crazy, but I don’t believe a “Thank You - come again!” deserves a trophy....or at least not one from a guest.

Like most guests. If I want to support people, products and services I find enjoyable or valuable, I’ll do it by repeatedly giving them my business. My apologies if that’s not enough - but unless we’re going into business together and I’m getting a share of the profits; only one of us is going to be responsible for paying your cashier.

Regards,

Josh

So I guess you have to decide for yourself which camp you fall into and consider your guests’ demographic.

At the end of the day, I think you’re doing the right thing. If you make your staff rely solely on tips to survive, it’s the more affluent guests who will decide whether or not your business thrives.

As far as those owners who do decide to put their businesses in the hands of only those guests who are able to tip well, I hope they’re offering something very unique - and killing it.

Stay the course,

Josh