How much should you tip your barista?
A new payment trend is sweeping across America, making the experience increasingly awkward: digital tip jars.
You order a coffee, an ice cream, a salad or a slice of pizza and pay with your credit card or phone. Then a clerk standing behind the counter turns a touch screen and slides it in front of you. The screen has some suggested tip amounts, usually 10%, 15%, or 20%. There is also usually an option to leave a custom tip or leave no tip at all.
The worker is right in front of you. Other customers are standing behind, waiting impatiently and looking over his shoulder to see how much to tip. And you have to make a decision in seconds. Oh lord, the stress.
Customers and workers today face a radically different tipping culture compared to a few years ago, with no clear standards. Although consumers are used to tipping waiters, bartenders, and other service workers, tipping a barista or cashier may be a new phenomenon for many shoppers. It is being driven in large part by changes in technology that have allowed business owners to more easily shift workers’ compensation costs directly to customers.
“I don’t know how much you’re supposed to tip and I study it,” said Michael Lynn, a professor of consumer behavior and marketing at Cornell University and one of the leading researchers on tipping habits in the US.
Adding to the changing dynamics, customers have been encouraged to tip generously during the pandemic to help keep restaurants and stores afloat, raising expectations. Total tips for full-service restaurants increased 25% over the past quarter compared to a year ago, while tips at quick-service restaurants increased 17%, according to Square data.
The shift to digital payments has also accelerated during the pandemic, prompting stores to replace old ones. cash tip jars with tablet touch screens. But these screens and procedures for digital tips have proven to be more intrusive than a low-pressure cash tip jar with a few dollars in it.
Customers are overwhelmed by the number of places where they now have the option to tip and are feeling pressure about whether to add a tip and by how much. Some people deliberately walk away from the screen without doing anything to avoid making a decision, say etiquette experts who study tipping culture and consumer behavior.
Tipping can be an emotionally charged decision. Attitudes toward tipping in these new settings vary widely.
Some customers tip no matter what. Others feel guilty if they don’t tip or embarrassed if the tip is stingy. And others avoid tipping for a $5 iced coffee, saying the price is already high enough.
“The American public feels tipping is out of control because they are experiencing it in places they are not used to,” said Lizzie Post, co-chair of the Emily Post Institute and a great-great-granddaughter of its namesake. “Times when tips are not expected make people less generous and awkward.”
Starbucks has released tips this year as an option for customers who pay with credit and debit cards. Some Starbucks baristas told CNN that tips add extra money to their paychecks, but customers shouldn’t feel obligated to tip every time.
A barista in Washington state said he understands if a customer doesn’t tip for a drip coffee order. But if he makes a custom drink after spending time talking to the customer about exactly how it should be made, “I’m a little disappointed if I don’t get a tip.”
“If someone can afford Starbucks every day, they can afford to tip on at least some of those trips,” added the employee, who spoke on condition of anonymity.
The option of tipping is seemingly everywhere these days, but the practice has a troubled history in the United States.
Tipping spread after the Civil War as an exploitative measure to keep down wages of newly freed slaves in service occupations. Pullman was most notable for his tipping policies. The railway company hired thousands of black porters, but paid them low wages and forced them to rely on tips for a living.
Critics of tipping argued that it created an imbalance between customers and workers, and several states passed laws in the early 20th century to outlaw the practice.
In “The Itching Palm,” a 1916 rant about tipping in the United States, writer William Scott said that tipping was “un-American” and argued that “the relationship of a man who gives a tip and a man who accepts it is as undemocratic as the relationship of master and slave.”
But tipping service workers was essentially made into law by the Fair Labor Standards Act of 1938, which created the federal minimum wage that excluded restaurant and hospitality workers. This allowed the tipping system to proliferate in these industries.
In 1966, Congress created a “sub-minimum” wage for tipped workers. The federal minimum wage for tipped employees has remained at $2.13 per hour, lower than the federal minimum of $7.25, since 1991, although many states require higher base wages for tipped employees. If a server’s tips do not meet the federal minimum, the law says the employer must make up the difference. But this does not always happen. Wage theft and other wage violations are common in the service industry.
The Department of Labor considers any employee who works in a job that “customarily and regularly” receives more than $30 a month in tips to be eligible to be classified as a tipped worker. Experts estimate that there are more than five million tipped workers in the United States.
Tip amount is entirely subjective and varies by industry, and the link between service quality and tip amount is surprisingly weak, Cornell’s Lynn said.
He theorized that a 15% to 20% tip in restaurants became standard due to a cycle of competition between customers. Many people tip to gain social approval or in the expectation of better service. As tip levels increase, other customers begin to tip more to avoid loss in status or risk poorer service.
The gig economy has also changed the tipping rules. A MIT study launched in 2019 found that customers are less likely to tip when workers have autonomy over whether and when to work. Nearly 60% of Uber customers never tip, while only about 1% always tip, a 2019 University of Chicago study found.
What makes it confusing, Lynn said, is that “there is no central authority that sets the tipping standards. They come from the bottom up. Ultimately, it is what people do that helps establish what other people should do.
Workers who earn sub-minimum wages, such as restaurant servers and bartenders, should almost always be tipped, tipping experts and advocates say.
When given the option to tip at places where workers earn by the hour, like Starbucks baristas, customers should use their discretion and remove any blame from their decision, etiquette experts say. Tips help these workers supplement their income and are always recommended, but it’s okay to say no.
Etiquette experts recommend that customers approach the touchscreen option the same way they would a tip jar. If they did leave change or a small cash tip in the jar, do so when prompted on the screen.
“A 10% tip for takeout is a very common amount. We also see change or a single dollar per order,” said the Lizzie Post. If you’re not sure what to do, ask the worker if the store has a suggested tip.
Saru Jayaraman, president of One Fair Wage, which advocates ending sub-minimum wage policies, encourages customers to tip. But tips should never count against service workers’ wages, and customers should demand that companies pay workers full wages, he said.
“We have to tip, but it needs to be combined with telling employers that tips should be above, not in lieu of, the full minimum wage,” he said.