5 reasons we should ban tipping

The practice is confusing, inefficient and ultimately discriminatory, researchers say.

By Kim Peterson Jun 5, 2013 1:59PM
Man leaving tip on table at café (© Jupiterimages/Brand X Pictures/Getty Images)If you listen to the latest Freakonomics Radio podcast, you may never want to tip again. Host Stephen Dubner interviews one of the country's experts on tipping, Cornell University professor Michael Lynn, who has written 51 academic papers on the subject.

In the podcast, Lynn was asked what he would do differently if he could go back in time and rewrite the social norms related to tipping. What would he change?

He said he would outlaw tipping completely. That's a surprising response from someone who has basically devoted his career to studying the practice. Some restaurants already do this. Dubner mentions The Linkery in San Diego, which bans tipping in favor of an 18% service charge for diners.

From the experts in the podcast, here are five reasons the U.S. should ban tipping:

It's discriminatory. This is Lynn's No. 1 reason for outlawing tipping. In his research, he's found that the people who get the most tips are slender white women in their 30s with large breasts. What a surprise.

He's also found that minorities get fewer tips in general. When you have an aspect of employment that hurts a broad class of people, whether it's intentional or not, that's absolutely discriminatory. This is a class-action lawsuit just waiting to be filed.

It may lead to corruption. Another expert interviewed in the podcast, Magnus Torfason from Harvard Business School, said he has found that countries with more tipping have more corruption.

It's really uncomfortable. For the tipper, that is, and possibly for the tippee as well. That's because people don't know what they're supposed to tip and for what service. How much is enough? And do I have the right bill on me? I can't really ask this person to break a $20 bill, can I? Help!

It's essentially subsidizing businesses. Lynn has estimated that about $40 billion a year is given in tips in the United States. Dubner pointed out that NASA's annual budget is less than $20 billion. So we could build two NASAs with all the money being tipped. That's money that businesses don't have to pay to their waitresses and other service employees.

It shifts work away from the employee. Tipping can actually create so much unease that some customers end up doing the work instead of the employee. For example, people carry their own luggage to their hotel rooms even though there are workers hired to perform that specific service. People park their own cars farther away, even though there's a valet right there at the door. As a result, some service workers end up with nothing to do, which is inefficient and wastes a company's resources.


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863Comments
Jun 5, 2013 2:42PM
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I have no problem with tipping, as long as it's my call.  It makes me furious for a restaurant to automatically charge a tip when it's a large party!  The whole purpose of a tip is a reward for a job well done.  Where's the incentive if a wait person knows they are going to receive a tip automatically - regardless of what kind of job they do? 
Jun 5, 2013 2:32PM
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About the racial part...I have a unique perspective.  My oldest daughter is 5'11, blonde, athletic and hot.  When she served in a restaurant, she made a ton of money on tips.  So I agree with the researcher.....somewhat.  My son served some during college and is Mr. Congeniality himself.  He got great tips...except when he served minorities.  Blacks hardly ever tipped him no matter what and in fact where generally very rude to him. Like his older sister, he is partially Hispanic.  My 3rd child is adopted and 1/2 white 1/2 black.  She just started serving to earn money for college and seems to be having about the same success as my son...but not as well as my taller, slender 1st daughter. She seems to have mixed results with blacks.  Her experience so far indicates that blacks tend to treat you worse than any other racial group (remember, she is 1/2 black herself).

Asians seem to be the best tippers.

My question is why is that?  My partially hispanic family teaches their children to respect and honor all people.  Do not blacks have that in their culture?  My advice to them is that if they want respect, perhaps they should dish it out 1st instead of expecting to be entitled to it.

Jun 5, 2013 3:00PM
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As Steve Martin said in 'My Blue Heaven' I don't believe in tipping, I believe in over-tipping. Provide me with great service, I'm tipping you at least 25-30%. I don't care about your sex, color, race, religious beliefs or boob size. I care about your effort to make my experience memorable and comfortable.

Now if you are lazy, indignant and feel like I am bothering you by asking you to do your job, I'll respond with a lovely note on the receipt, a talk with the manager and probably never return. I tip ZERO at those times and feel justified.

Jun 5, 2013 2:32PM
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Most tipped employees are paid minimum wage and they live on their tips.  I for one tip for service and have no problem tipping for good service, bad service...no tip...
Jun 5, 2013 2:32PM
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To this researcher, I say, go to he**.

I tip for good service and I don't tip for bad service.

I could care less about big boobs and a smile.

Regardless of sex, looks, or anything else, you treat me with respect and I

will reward you with respect, so take your research and stuff it.

Jun 5, 2013 2:41PM
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In a restaurant it shouldn't be based on a percentage of the bill. That's ludicrous. I should tip less because I got a hamburger instead of a steak??? I tip on the service.

 

 

 

Jun 5, 2013 2:50PM
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The article doesn't point out that it would also make it much harder to not report income.  I would like to admonish the writer of this for his reference to the Linkery. They have not outlawed tipping, they are just taking the choice of it away by including an 18% gratuity. I personally refuse to dine in places that have that policy, whether just for 1 or 2 people, or a party of 4 or more.  In any event, I tip based on service. I may tend to be more generous to the person at a diner or family establishment where they indeed work hard for the small amount they get on each transaction. Conversely, I've had atrociously bad service at high end places more than once and resent being expected to pay 10 to 20 a head for the experience. The worst was a Ruth Crist in Philly, where there was 18% added because we were a table of 6. Couldn't even get to the manager to complain about the service and meal, and why I have my personal policy;  worst dining experience ever for me.  I'd like to see the servers get paid properly with a small increase in the meal cost, and be given the option to tip 5% for good service, more for exceptional service.
Jun 5, 2013 3:17PM
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The professor sayshe would ban tipping, the article then mentions places that have done just that but add 18% gratuity.  You didnt ban tipping, you just made it mandatory and at a fixed rate.  Doesn't make much sense to me.

Also, not every job is supposed to be a living wage, that supports a family of 4 or more, provides healthcare, vacations and retirement.  Some jobs are to make extra cash, or to help yourself through school.  The rest of us did them, bettered our selves and moved on.  Don't like the job, can't support your family of 5 and live in a big house in the big city, move on and let a college kid do the job while he/she earns their degree.

Jun 5, 2013 2:50PM
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I feel tipping is good because of the following reasons.

 

1.  I  tip according to service given ,, poor service = no tip  or low tip , great service can be a 25%+ tip

 

2.  Tipping keeps poor service out of the work place, since no money = gone poor employee or they get better at their job.

 

3.  Are you willing to pay a 18% surcharge to McDonalds or Burger King ???  it will come to that

 

Blonde , big tits , and crap service = poor tip unless its a stripper ;)

Jun 5, 2013 2:54PM
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I tip based on service....and for the most part it's 20%...

if I don't like the service, etc, then the tip goes on the cc....therefore they have to report it....

I don't care if the waiter/ress is white, black or whatever...it's the same.

 

 

Jun 5, 2013 3:20PM
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"Cornell University professor Michael Lynn who has written 51 academic papers on the subject"

 

What loon would write 51 papers on a subject that few people care about? Shouldn't he be teaching his liberal message to his class and give the graduate assistants a break? After all, he is paid big bucks to teach even if it's the usual left wing rhetoric. Sounds like another dead weight with tenure.

 

If people actually have trouble figuring out how much to tip, they should be remanded back to the good old days when teachers in the 5th grade would actually teach their students important things in life (like simple arithmetic) and not indoctrination.

 

Perhaps the professor wants to "ban tipping" and have a 15 -18% tip added to all bills. This isn't banning tipping, it's forced tipping!!  Another utopian dream that people with far too much time on their hands come up with.

 

 

Jun 5, 2013 3:14PM
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"This is a class-action lawsuit just waiting to be filed."

 

Good luck proving damages.

 

I'll tip if the service I receive warrants it. If it doesn't, learn to serve better.

Jun 5, 2013 2:29PM
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As business owner where tipping is practiced I say.....what a crock.  If restaurants ban tipping and the owner has to pay the standard minimum price, what will happen is that all the meals and drinks will be raised quite a bit.  The waitstaff makes a heck of a lot more than the standard minimum wage.  The customer will pay more for food and the waitstaff will make less money.  The person that gives good service makes more money and the person that gives bad service makes less......that seems fair to me.
Jun 5, 2013 3:42PM
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Yes, of course it's discriminatory.  This is one thing the PC police just cannot control.  If I don't like the race, gender, size, age, or sexual orientation of the server I can stiff them for that reason or for no reason.  They're not my employee.  I break no laws by exercising bigoted, irrational reasons for stiffing them.  And yet.........there's not a damn thing the "everyone-is-special" crowd can do about it.  Show some of your "tolerance" for that point of view.  Bwa ha ha ha ha.
Jun 5, 2013 3:32PM
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We tip according to service...we always tip a good server well and it doesn't matter to us about race,  age, looks, etc.  Servers get minimum wage and their tips help them live better.  I don't know anyone who can live on minimum wage easily. 
Jun 5, 2013 2:58PM
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"And do I have the right bill on me? I can't really ask this person to break a $20 bill, can I? Help!"

 

Are you really that stupid or scared to ask for change??

 

That has to be the lamest statement this week besides the MSN story titled " Death by drowning is quiet "   DUH !!!!!!!!!

Jun 5, 2013 2:40PM
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Tipping was banned in Iowa in 1913, and that was overturned as unconstitutional by an Iowa Supreme Court decision in 1915. It may not be legal to ban tipping.
Jun 5, 2013 2:54PM
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Itnm -- fine, charge a higher fee!  Supply and demand will take care of itself in the food service world.  We should not be forced to tip because the restaurant chooses not to pay their employees a fair rate.  If a server truly goes above and beyond in their service, everyone has the option to tip.  The person that gives good service gets a few extra bucks and keeps their job, the person that gives bad serve should be fired.
Jun 5, 2013 2:56PM
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This is a two way street. I tip for good service and withhold for bad. conversly, folks in the service industry who rely on tips know this when they accept the job. So take the hint and do a good job with a great attitude and in the long run you will average out higher tips. As with anything else you throw out the low (those that tip on race or looks), and the high (those that tip a standard percentage) and adjust your game to the middle ground that is influenced by great service. 
Jun 5, 2013 2:47PM
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Tipping makes the worker try to give an outstanding service to the client. If the client feels he or she is being pampered by a solicitous employee, the client may feel that a gratuity is in order. There are restaurant workers who make quite good by providing an excellent service, and I suppose other workers in other industries also do great as well.

 

Tipping is voluntary and it should stay that way.

 

Of course restaurant owners have been taking advantage of their waiters, waitresses and their clients' tipping...but it would suck to be eating at fast food joints where tips are not required

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