Amanda Cohen on Why Tipping Is a Devil’s Bargain

This is Dispatches from Dirt Candy, a column from New York City chef Amanda Cohen that explores the realities of working in the restaurant industry. In today's installment, Cohen tackles tipping.

I can see the entire dining room of Dirt Candy from my station, and every night I see it happen. A group is splitting the check and they can't decide how much each of them should leave as a tip. Major math drama ensues. Or a family comes to eat, Dad pays the check, leaves the tip, and one minute later his son comes running back to secretly add more cash. Or people call the next day in distress: They were very drunk the night before. Did they leave a tip? Was it too small? Should they mail more?

It makes no sense. At the end of the meal, just when people are very drunk, or very full, or very ready for romance, we ask them to do math. And not just any math, but a word problem involving percentages. It's a lame way to end a meal, and I think it's becoming more and more clear: Tipping has to go.

If there was a shred of research that showed tipping was a rational process, I would be all for it, but the research shows that tipping makes no sense. Servers wearing white shirts get higher tips than servers wearing red shirts. Blonde waiters make bigger tips than brunette waiters. Waiters who draw a smiley face on the check get better tips, unless they're men, in which case they make worse tips. Black waiters make lower tips than white waiters.

Tipping is supposed to reward good service and discourage bad service, but in the six years Dirt Candy has been open only twice has a customer left a super-low punishment tip. I'd like to think that's because Dirt Candy always provides exceptional service, but it's more likely that we all know exactly how much we're going to tip before we even sit down: 9 times out of 10, each of us pretty much tips what we tipped the last time we went out.

Tipping is unfair to servers. If you do a job, you should be paid a fair salary. In New York state, minimum wage is $8 an hour. Waiters receive $5 an hour on their paycheck with the remaining $3 an hour made up by tips. This means that, by law, waiters in New York have a guaranteed salary of just $5, lower than someone running a register at Sbarro's. It usually works out to the waiter's advantage, but if the restaurant hits a slump, the waiters — not the owners — get hit in the pocketbook first. There's nothing wrong with someone leaving a little extra something to show gratitude. There is something wrong with that gratitude making up a majority of a server's salary.

Diners are aware that their server's salary comes from tips, and so it puts an unfair burden on them. We're asking our customers to turn a voluntary expression of gratitude into a living wage. On top of that, tipping asks every customer to be a spy. One of the unspoken assumptions of tipping is that it's impractical for a manager to monitor every server all the time, so tipping outsources that supervision to the customer. A bad tip is a red flag to a manager that a server requires closer supervision, but most customers just want a nice meal, not to be deputized as the owner's secret HR department. However you look at it, tipping puts extra pressure on the diner, and that's the last thing a chef wants.

Tipping hurts restaurants by turning your staff into separate and not always equal factions. I firmly believe that if you loved your meal so much that you want to leave a big tip it's because everyone worked together, from my servers, to my line cooks, to my dishwashers. Maybe the diner loved the taste of the food, maybe they loved the wine selection, maybe they thought the whole experience — from the sparkling place settings, to the exemplary service, to the perfect food — was worth a tip. But right now, only the servers are allowed to touch that money.

New York State has tried to address this by allowing tip pooling and tip sharing, and some restaurants like the Chef's Table at Brooklyn Fare have replaced tipping with a 20% service charge. The problem is, by law, you cannot distribute the proceeds of a service charge to anyone who was not involved in direct customer contact, which rules out line cooks and dishwashers.

Tipping is a devil's bargain. On menus across the city, food should cost more than you're being charged, but tipping is a form of price partitioning that allows a restaurant to disguise some of its labor costs as a "voluntary" tip. In exchange for being able to keep prices lower than they should be, an owner agrees to give up control over 20% of his income, passing it on to his wait staff. It makes no sense, but there is a solution.

Some Back-of-the-Envelope Math

Hypothetical Restaurant & Cafe* has 20 tables with an average check of $100 and makes around $6,000 per night with 4 servers on the floor. The tips on $6,000 worth of business would be around $1,200, meaning that each waiter is taking home $300 for their work. A waiter is often paid for 8 hours, so each waiter is making $37.50 an hour in tips (plus $5 an hour guaranteed base wage) for a total of $42.50 an hour. Compare that to a line cook who (on average) makes $14 an hour, rain or shine, full dining room or empty. And let's not even get started on dishwashers who generally make about $9 per hour. (See footnote.)

Hypothetical Restaurant & Cafe with Tips
Servers: $42.50/hour
Line Cooks: $14/hour
Dishwashers = $9/hour

If that $1,200 was a service charge of 20 percent on every bill that could be spread among all the staff, whether they provided direct customer service or not, things would change dramatically.

Hypothetical Restaurant & Cafe with Service Charge
Servers: $34.50/hour
Line Cooks: $18 hour
Dishwashers: $13/hour

These numbers will vary from restaurant to restaurant depending on hours worked per server per week, whether servers tip out bussers and bartenders, taxes, the average check at each restaurant, and so on and so forth. But this back-of-the-envelope exercise does highlight the fact that servers can make more than twice what kitchen staff make and four times what dishwashers make in a given shift. It also suggests that it's more than possible to create a far more equal system where everyone can enjoy the benefits of happy customers. But right now, in New York state, trying to do this would be completely illegal.

Income inequality is a huge problem and every industry is going to have to start re-examining how it pays everyone, from its CEOs to its janitors. Currently, restaurants are forced to follow a feudal practice that encourages an unequal distribution of wages. Some people might protest, "Why should servers have to give up anything?" but judging by reports from restaurants that have already eliminated tipping, servers may actually find that they prefer working for a salary rather than tips. I love my servers, I think they do a great job, but I also think that paying them the same hourly wage as a nuclear reactor operator rewards their hard work while also treating them as a valued member of the restaurant team, rather than as a private contractor tap dancing for tips.

Restaurant pay needs to move into the 21st century. Right now, the United States is one of only four countries in the entire world that do not provide paid maternity leave. Restaurant workers need paid maternity leave, they need health care, they need sick leave. It won't happen overnight, but the first step in that direction is throwing an 18th century custom onto the trash pile. Servers will lose the lottery-like adrenaline rush of their job ("Maybe tonight someone will leave a $1,000 tip!"), and they'll take a small hit in their wallet, but what they'll gain is a far more stable working environment where everyone is paid more fairly. And while customers may lose the rush of feeling like a big spender, they'll also be free of getting mugged at the end of their meal and forced to do math.

*I'm talking here about the rough economics of small restaurants in NYC. Average salaries are very different for franchised restaurants like TGI Fridays or California Pizza Kitchen, and when you factor those in (along with the salaries at unionized restaurants) you come up with the Bureau of Labor Statistics's numbers which give the following as average pre-tip salaries for NYC waiter at $23,000, cooks at $28,000, and dishwashers at $20,600.

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