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Tipping in Toronto: Is 22.6% the new normal?

Is 22.6% the new normal tip for restaurants in Toronto?

Amy Pataki’s article in the Star “Standard tip in Toronto restaurants now 20 per cent” about the tip prompts at the Ace and the Westerly raised an issue that I think needs some more careful examination.

First the Star/toronto.com’s headline is wrong. There may be a push to make this so and some of us might consider 20% our standard but general practice in Toronto is still to tip 15% on the before tax total.

In his excellent two-part story on tipping at Inside Toronto last November (part 1, part 2) Eric Vellend set fifteen as the starting bar. In their guides to travel in Canada both Trip Advisor and Lonely Planet agree that 15% is standard.

To Pataki’s credit she said on Twitter@Optimus_Wombat Agreed, headline onbit.ly/Aw7auz misleading. Tip standard still 15%, but possibly creeping upwards.”

Having established that while things may be headed that way, 20% is not the standard, I wonder what else is there to consider in the article? I think it’s this idea that owners are suggesting that customers tip 50% more than they used to. (Quick math: these particular machines are programmed to suggest 20% after 13% HST, which is 22.6% of the before-tax total or the standard 15% tip, plus half more. Also, this will be even more of an increase in situations where the higher taxes on alcohol are applied.)

Pataki writes: ” ‘We feel we are providing great service. Waiters don’t get paid too much,’ said Tom Earl, co-owner of The Westerly.” Wait a second “waiters don’t get paid too much”? By whom? Well, obviously that would be by owners like Tom Earl. How this glaring contradiction went unexamined baffles me.

Servers do a difficult job and ones who work in licensed establishments are allowed to be paid a minimum wage that is lower than other sectors (that doesn’t apply for unlicensed sandwich counters and the like). For that reason we’ve developed a social custom of adding a tip when service meets expected standards and a more generous one when those expectations are exceeded. If owners think their employees are under-paid they should raise prices and pay them more. Period.

That’s because no matter how much we think that by banging our fists on our cardboard pulpits and exhorting fellow diners to tip better and (by implication) come up with the extra cash by spending less on shoes or putting off the next iPhone purchase for a couple weeks they probably won’t. If they usually spend $100 eating at restaurants per month the increased social pressure to tip more will just mean that a greater part of that same budget goes to tipping.

Good news for servers can be bad news for a whole bunch of other costs that go into a restaurant. Less for high-quality, ethically-concerned ingredients and less for the kitchen staff that is often just as poorly paid as the front of house staff. This jump from 15% to 22.6% percent means four fewer dollars (or a five percent drop) from that theoretical hundred-dollar budget.

I’m not surprised that this story has caused some virtual red faces. Certain restaurant owners are taking a sneaky, disingenuous route to raising prices and not enough is being done to hold them to account.

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9 Comments

  1. Interesting piece. I tend to tip 20% after tax, but feel well within my rights to tip WAY less if I don’t feel completely happy with the experience.

  2. I tip when the service, food and atmosphere demand it, needless to say I can be a great tipper as I also work in the industry. On the other side I am also the one at the table who will refuse tipping bad service and bad food when everyone else wants to leave something – bad is just bad…period.

    Also consider how much a good waiter / waitress can make. I know several that can top easily $50.00 an hour in just tips, others more, many less, in a 2000 hour year (2200 work hours in a year) that is about 100,000 just in unaccountable wages.

  3. Dan says:

    In what way is providing the opportunity to tip 20% “sneaky and disingenuous?” If you want to tip like a jerk hit the other button. Clearly Mr. Earl believes that the service patrons receive at his restaurant is worth 20%, if you disagree that’s your prerogative.

  4. foodwithlegs says:

    Thanks for commenting Darryl and Sarah. I have a similar system to yours.

    Darryl, imagine how much different this discussion would be if we had hard evidence on tips. (i.e. high, low, average)

  5. foodwithlegs says:

    Dan, thanks for your comment.

    If Mr. Earl thinks that his employees are underpaid why doesn’t he pay them more? I walked through why prodding customers to tip above standard will mean less money, in the long term, for non-tip employees and other suppliers but I’m happy to do that again if you’d like?

    I can’t help but shake my head at “if you want to tip like a jerk”. What if the service was just mediocre and didn’t deserve 20%? Why is the default assumption that the tip amount is a comment on the tipper and not the server being tipped?

  6. bill says:

    I’m with Foodwith legs – I tip for service, not because I am supposed to feel pity that this person is a server. I also agree that if these restaurants should be paying their staff more if the staff are in fact not being paid adequately. The customer is most likely being over-charged for their meal, so now they must also tip 20%+ on top of this automatically? That’s ridiculous!

    My biggest pet peeve is tip jars, etc. at take-out places, etc. This could be booster juice or it could be Burger Priest. At booster juice, I don’t mind giving a buck or whatever I get in my change…if the server is nice or pleasant somehow. If they hand me a cup and then look at the tip jar, they get nada. That’s rude imo.

    Burger Priest cracked me up. It was Night 2 of the new opening on Yonge so perhaps this was more of an anomaly, but there was a large dish and it was full of $20′s, $10′s and $5′s. I’m hoping it was the Burger Priest staff sticking the big bills in there (although that also annoys me as the intent would be to guilt you into tipping – um, no), but who pays $15-20 for a burger, fries and pop and feels that the establishment deserves another $5-$20 tip! Am I cheap or is that a bit much? (I know the kids at Weber’s up North, who do a way better job entertaining the customers than the staff at Burger Staff, would LOVE to get tips too…but old school Weber’s knows that isn’t how the world works…it’s just how it seems to work in over-priced Toronto these days!)

  7. Economist says:

    I see no reason to subsidize the restaurant industry which pays low wages to wait staff to increase overall profits to the owner. I particularly resent the owner attitude exhibited that the client should feel guilty for not wanting to subsidize them. This is a prevalent North American idea these days that business owners should pay as little as possible for wages thus increasing their profit margin at the expense of the employee and their customers.

  8. foodwithlegs says:

    Thanks for commenting, Economist. You make a good point but I guess the two counter-arguments are that 1) by costumers paying servers directly and taking owners out of the loop we eliminate the opportunity that would exist in a world of higher prices and agreed higher wages for some owners to free-ride by taking advantage of servers with limited employment mobility; and 2) we recognise that restaurant service is not an interchangeable commodity and think that by paying more when it is good that we’ll encourage bad servers to improve.

  9. Economist says:

    It is the employers job, not the customers job to train wait staff and to provide incentive for a job well done. The customer rewards the owner for not only having a good product but good service by giving return business. Alternately the customer can complain about poor service and/or poor product. Again, it is not the job of the customer to subsidize the owner who is paying low wages to his staff.

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