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To tip or not to tip? That is the question in 2016

What do you tip at a restaurant? Twenty percent if the service is good? And when it's lousy? What about at a counter-service spot or for takeout? What if you have a Groupon?

Do you, like more and more Americans, want to banish tipping?

The new year is shaping up to be the Wild West when it comes to gratuities. New technology, minimum wage hikes, even changing social mores mean many of us agonize about the digits we scrawl above our John Hancocks. In some parts of the country, restaurant tipping is being phased out entirely, although in Tampa Bay, we're not quite there yet.

In the first half of the 20th century, Americans generally tipped around 10 percent. In the go-go 1980s, that crept up to 15 percent, the gold standard for decades. Now? It depends on whom you ask, but according to longtime restaurateurs like Harold Seltzer, who owns two Tampa Bay steak houses and a sandwich shop, "a good tip is 20 percent. From a server's perspective, that's the expectation."

We know it's the expectation because it's often right there on the bottom of the bill: A chart that lists what an 18, 20, even 25 percent tip would be (15 percent is a suggestion increasingly absent). As Seltzer remembers, these handy calculations started to appear a few years ago when restaurants' computer systems began allowing customization.

These systems are poised for another big change.

In October, when credit card companies introduced chip card technology, there were other behind-the-scenes changes, says Andrew "Wilko" Wilkins, director of independent restaurants for DATUM Corp. in St. Petersburg.

The EMV (that's EuroPay, MasterCard, Visa working together on this ostensibly safe payment method) chip card is not mandated, but now the liability for fraudulent activities shifts from the credit card companies to the merchants.

Problem is, says Wilkins, the big vendors are still figuring out how to have chip readers in the dining room. And there's this: Diners will have to indicate the tip before the card is run. That means no more scrawling a tip and dashing.


It seems tipping privacy is going the way of the dodo.

Kahwa Coffee uses a LevelUp app. It functions as a loyalty program and is convenient for customers, who only get one bill at the end of the month. But coffee drinkers have to put a tip in before they are served. Mickey's Cafe in St. Petersburg uses the Clover System, Squeeze Juice Works in Tampa and St. Petersburg uses ShopKeep and Karma Juice Bar in St. Petersburg uses Square — all systems for which employees swivel a screen so customers can sign and choose a tip. A tip that gets decided in plain view of the person you are, or aren't, tipping.

"I imagine this increases tips," says Alex Watson, a bartender at Tampa's Fodder & Shine who has also been a waiter in Tampa for six years. "People just don't want to be embarrassed or come off as cheap. I notice a difference between tipping in bar service versus table service where a tip is more anonymous. At the bar I try to avert my eyes so there's no pressure."

Some new payment technology may have exactly the inverse effect. Restaurants like Carmel Kitchen and Chili's have adopted tablet ordering systems. Customers tap their way through ordering and swipe their own credit cards. And thus, says Chris Ponte, chef/owner of Cafe Ponte and the soon-to-open On Swann, people feel they don't have to tip as much.

"If I'm going to punch in my own order and the waiter isn't helping me navigate through the menu, I'm going to tip less," Ponte says.

Tablet ordering can minimize labor costs because "you can get food runners rather than servers," Ponte says. At his own restaurant, the average tip these days hovers around 20 percent, but his older customers tend to tip more than younger ones. For millennials, who often order food electronically, he says tipping is "less of a priority."

Millennial Katie Ulch, a 28-year-old social media marketing manager in Tampa, defends her generation.

"We are better tippers than our parents," she says. "The main cause is that it's a rite of passage to work in the restaurant industry, so we have a better understanding of what a restaurant worker goes through."

Empathy for restaurant workers prompted interesting developments in 2015.

In October, New York restaurateur Danny Meyer announced that all 13 restaurants in his Union Square Hospitality Group would do away with tipping, paying servers a higher regular wage.

"He was trying to be fair to the staff by taking care of the discrepancy between kitchen workers' wages and the front of the house," explains Peter Veytia, co-owner of the growing Red Mesa empire in St. Petersburg. "Joe's Crab Shack had already initiated that. I am on the fence and anxious to hear what the response is from customers."

Around here, the Joe's Crab Shack location in Clearwater may be the only restaurant thus far that has gone to a no-tip model.

Could this new model be short-changing servers? Mike Harting, owner of 3 Daughters Brewing and a partner in Souzou in St. Petersburg, thinks so.

"Why would servers work for $15 per hour when they're already earning $30 per hour now? How are you going to keep quality employees?"

Plus, he says, tipping encourages entrepreneurial zeal and hard work.

"Any time there's a chance for a transactional bonus, that's a good thing," he says. "Why are barbers so friendly, or nail salon workers, or car wash people?"

Frankly, many restaurant owners would prefer customers help pay the staff. If Harting has 10 servers working on a Friday night, each working five hours at $6 per hour, a raise to $15 per hour means an extra $450 the restaurant would be paying. That means fewer servers with bigger sections (thus, less attention per table), or higher menu prices.

In 2014, the Seattle City Council passed a $15 minimum wage law to be phased in over time. Rather than pay it, some restaurants moved to the 'burbs where minimum wage remains low.

"If the minimum goes up to $15, I'll go out of business with tipping employees," says Zack Gross, owner of Z Grille in St. Petersburg. "The people making decisions about the minimum wage have never worked in the hospitality industry. None of my servers make under $27 an hour."

Still, no tips and a higher fixed wage might have some benefits for employees. Restaurant workers could find it easier to get credit, or to buy a car or home with a more wage-based compensation, says Melissa Wilson of Chicago food industry research firm Technomic. And in places like Tampa Bay with enormous seasonal fluctuation in business, servers' wages might stay steadier. Plus, she says, doing away with tipping means doing away with some consumer frustration.

And it is frustrating.

Do you tip a counter service person? The answer is yes if they are paid the $5.03 minimum wage for tipped employees. But how do you know that? And while many restaurant-goers grouse that they shouldn't be paying a tip on the state tax tacked onto the bill, most restaurant workers are emphatic that tipping is on the post-tax total.

And then there are coupon deals. Restaurant folks think servers are unfairly penalized if customers tip based on the discounted total.

Whew, gratuity logic can be complicated. But to do away with tips entirely might change the whole dining experience, says Harting.

And after all, "The only things that are leftover from the age of aristocracy are, you're treated like a king or queen at a hotel and at a sit-down restaurant."

Contact Laura Reiley at [email protected] or (727) 892-2293. Follow @lreiley on Twitter.

To tip or not to tip? That is the question in 2016 12/31/15 [Last modified: Saturday, January 2, 2016 10:24pm]
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