Tipping: Necessary Evil or Relic That Needs to Die?

Manresa chef/owner David Kinch recently called the practice of restaurant tipping an "antiquated slave system" that is "holding back an entire half of the industry" in an interview on the Bad Deal. And indeed, the practice can be pretty controversial; Freakonomics even did an entire episode about it this week.

There are generally two camps when it comes to how we pay servers: For some diners, tipping is an obligation; instinctive, a product of an ingrained social education. A survey CouponCabin.com conducted last Spring actually found that 87 percent of diners feel obligated to tip in restaurants. For others, the tip is seen as a bonus; something that should only be earned if service went above and beyond the diner's level of expectation.

From time to time, diners take advantage of the tipping arrangement and offer far less than a standard 20 percent tip. From a business standpoint, restaurants can rely just as much on a patron's ability to pay its servers as the servers themselves do. The system, while flawed, is utterly ingrained within the American psyche. So what's to be done about tipping?

What's Wrong With Tipping?

As the amount of the tip is up to the customer, the money a server can earn off any given check can vary widely. In a recent Freakonomics podcast, Cornell Professor of Consumer Behavior and Marketing Michael Lynn lists specific physical attributes that seem to earn servers larger tips: blondes get better tips than brunettes, slimmer women get better tips than heavier ones, larger breasted women get better tips overall, and women in their 30s get better tips than ones that are younger or older. Tipping can also be gender-discriminant; Lynn says that "men's appearance doesn't matter as much" to tipping customers.

And the kicker is that the customer's ability to tip really doesn't make that much of a difference in the level of service. "Tips are not as strongly related to service as you would expect, only about a 0.2 correlation," explains Lynn. Even longtime waiter and book author Steve Dublanica concedes that the "quality of service has almost nothing to do with the tip a server receives." In fact, Freakonomics sums tipping up as an "awkward, random, confusing ... and probably discriminatory" act.

Alternatives: Service Charges, Ticketing

So what's to be done? It would be ideal for a service charge to be built into the restaurant, Kinch says, and for the house to take it and "use [it] to pay a living, salaried wage and benefits to service staff" so that "it can become an honored profession like it is in Western Europe, ... Japan, ... South America and Latin America." Yet he also acknowledges that American clients "want a so-called power over their servers." He continues, saying that "the implication, the implied veiled threat ... is part of the contract between client and front of house staff."

But would a service charge work for no-reservations restaurants, which depend on a steady stream of customers for success? For these, the bottom line weighs more heavily. Eater reached out to Pok Pok chef-owner Andy Ricker, who brought up the concept of tickets: "Unless a restaurant makes a shift to all presales, like Alinea and Next, there is no way around [tipping], both from the server's standpoint and the restaurateur's." In other words, the server has to make a living and the owner needs patrons' tips to pay for the server's labor, "as they cannot afford to pay wages that high."

Grant Achatz and Nick Kokonas pioneered a ticketing system at their Chicago restaurant Next, which in part functions as a way to get around gratuity. The system works like this: customers prebook a table for their desired night online, paying upfront for the amount of the meal plus tax and a 20 percent service charge. Kokonas told Crain's that in addition to being an "more efficient" way of getting diners into the restaurant, the process "probably adds 8 percent to ... revenue" thanks to fewer cancellations and no-shows. To chef-owners like Kinch, this ability to not have to worry about servers "begging like slaves" to get the best shifts or to be assigned the best tables will give servers "incentive to do a good job" and also be "[enthusiastic] about accomplishing something."

The Benefits of a Tipping System

To the foreigners that are used to servicemen and women work without tips, tipping is ultimately seen as a motivator, as it was for Australian writer John Birmingham. He marveled at the power the diner holds in the arrangement, writing "The people working at the bottom of the food chain in the service industries in the US are effectively working for whatever you decide to pay them directly. In many cases I don't know whether their base wage would even cover the costs of them getting to work." Instead of seeing a huge power disparity, however, Birmingham saw a brilliant incentive.

Even writer Foster Kamer — who back in 2010 wrote a feature detailing the institution of tipping to be an "assault on fairness for employers and employees as well as consumers' rights" — had to agree that despite "being presented with the potential for a higher, fairer income," the servers he talked to still preferred to be able to receive tip. "I just like the feeling of being tipped out at the end of the night," says Kay, a young twenty-something server quoted in the piece. "It's a great feeling. It's the feeling of being rewarded."

· Are Servers Hospitality Industry Mercenaries? [The Bad Deal]
· Should Tipping be Banned? [WNYC]
· All Tipping Coverage on Eater [-E-]