Understanding Tipping in the U.S.: When to Tip or Skip
We are all familiar with the following situation: you just ordered a coffee, and after tapping your credit card, the pay kiosk swivels around to show the suggested tip amount of 25% to 30%. What do you do?
Nowadays, many Americans are feeling confused about tipping protocols. According to poll findings released by the Pew Research Center, among nearly 12,000 U.S. adults, only about a third say it’s extremely or very easy to know whether or how much to tip for different services.1
Although there’s no definitive method for determining tipping rules, here’s what you should know about the history of tipping, the recent developments that have changed tipping culture, and how to approach tipping going forward.
How Tipping Culture Has Evolved
A Post-Civil War Origin
Tipping in the U.S. has a complex history. It was largely unknown in the U.S. before the Civil War but gained traction as wealthy Americans returned from visiting Europe, bringing the practice back home with them.2
Tipping is also said to reflect a darker aspect of American history, as it grew when the restaurant and hospitality industries began hiring newly emancipated Black women and men. They often weren’t offered a wage but instead relied on gratuities to earn a living.3
The Rise of Technology
The request for tips has surged with the advance of technology, as the option for tipping appears more frequently. Digital payment systems take advantage of design principles that influence tipping behavior.
For instance, clicking “no tip” on a kiosk feels more challenging than deciding not to tip unprompted. This has led to a phenomenon known as “guilt tipping,” where consumers feel pressured to leave a tip.
The Role of the COVID-19 Pandemic
Many restaurant and hospitality workers struggled during the height of COVID-19. Thus, tipping increased to help support these industries. According to an analysis of tip data by the National Library of Medicine, while tip-per-order was decreasing before the pandemic, it increased by $1.24, thus countering the previous negative trend.4
Tipping expectations haven’t seemed to lower since the pandemic. This could explain why the tipping amount has stayed up over the last few years, coined “tipflation” by news outlets.
Who Qualifies as a Tipped Employee?
Today, many service workers rely on tips for their livelihood. The Department of Labor considers a worker a “tipped employee” if they regularly receive more than $30 per month in tips.5
Under federal law, employers of tipped workers are only required to pay $2.13 per hour in direct wages as long as this amount, combined with tips, meets the federal minimum wage. The employer must cover the difference if the total does not reach the minimum wage.5
Some states set a higher tipped minimum wage. For example, Florida and Maine set tipped minimum wages that exceed the federal mandate but don’t match the state standard minimum wage.678
Some states don’t have a tipped minimum wage so tipped employees must be paid the state minimum wage. This is the case for Alaska, for example. There is no tipped minimum wage, so tipped employees must be paid the state minimum wage.8
Cities and localities may also set higher minimums in some areas. New York City has a tipped minimum wage higher than the state-mandated tipped wage. And “quick service employees” in New York State earn the same minimum wage whether they’re tipped employees or not.9
Appropriate Times to Tip
When You Are at a Service-Based Institution
You should expect to tip in places like restaurants, bars, salons, and hotels. This includes servers, bartenders, hotel bellhops, delivery drivers, valet drivers, and more. It’s also customary to tip your hairstylist, nail artist, and food delivery driver.
The actual tip amount varies depending on the service, but restaurants generally follow a 15% to 20% rule. RealSimple offers a tipping etiquette guide with specific suggestions about when and how much to tip.
When It’s Appropriate to Forego Tipping
When You’re Paying for Counter Service
According to CNBC, tipping isn’t expected for counter workers since they typically earn a wage. However, leaving a tip can be a thoughtful gesture, especially if you’re a regular customer, as it can help establish a positive relationship with the staff.10
When There Is Already a High Service Fee or Automatic Gratuity
Sometimes, restaurants already apply an automatic gratuity, especially for large parties. Since it’s already included, there’s typically no expectation to add to that. With that in mind, if you had great food and service, a 5% to 10% extra tip is a nice way to show your appreciation.
If the Service Wasn’t Good
If your expectations weren’t met, it’s acceptable to tip less than usual—some people may tip as low as 10%, but it’s advisable not to go below that. Be mindful of conditions out of your server’s control, like the kitchen running slow.
Is It Rude Not to Tip?
Unless the service is terrible, most etiquette experts recommend not skipping the tip for restaurant workers.
What Professions Should I Not Tip?
You shouldn’t tip professionals that are paid a salary. This includes teachers, plumbers, lawyers, and cable techs.
How Can I Show Appreciation If Tipping Isn’t Expected?
Salaried workers, like teachers, for instance, aren’t expecting a tip. However, there are other ways to show your thanks. Consider giving a gift card around the holidays, or writing a handwritten card. And of course, giving a verbal “thank you” does not go unnoticed.
How Do I Know If a Tip Is Already Included?
When you look at your bill, this could be listed as a “service fee” or “gratuity.”
The Bottom Line
Tipping culture in the U.S. is shaped by history, economics, and evolving social norms. Changes in technology, such as digital payment systems that prompt customers with pre-set tip amounts, alongside a post-pandemic world in which businesses leaned heavily on gratuities to compensate workers during economic uncertainty, have introduced new phenomena like “guilt tipping” and “tipflation,” leaving many Americans unsure of what to do or how much is truly expected.
However, researching and staying current on these practices can paint a clearer picture of tipping expectations. By doing so, we can ultimately help both customers and employees.