Daily Money - Tipping is totally tripping me up

Hi y’all —

In 10th grade, I had this super-harsh history teacher who would grade our essays in purple pen. When she didn’t like something we’d written — not when the facts were wrong, mind you, just when she didn’t jibe with the phrasing — she’d scrawl “AWK” out to the side. (For a 15-year-old aspiring writer, this was a particularly brutal insult.)

Now, as an adult, I swear I can feel Mrs. McDougald’s AWKs hovering over my head any time I’m in an awkward situation — like whenever the barista at my local coffee shop spins the point-of-sale tablet around for a tip.

I freeze every time because I don’t know what the etiquette is for tipping someone who’s doing nothing more than pouring cold brew into a to-go cup and sliding it across the counter. My confusion got even worse when I was in Italy last month because people don’t even tip waiters there.

But surely this doesn’t have to be so AWK. When is it OK not to tip?

Obviously, I’m not the only one who’s getting tripped up. “Tipflation” and “tip creep” have sparked a whole bunch of debate(s) lately, with near-constant hot takes and viral social media posts. Diane Gottsman, national etiquette expert and founder of the Protocol School of Texas, confirmed that it’s tricky.

“As a society, we really want to do the right thing — we don't want to cheat anyone, but at the same time we don’t want to be taken advantage of,” she says. “Knowing when it's appropriate and when we can pass on that gratuity is helpful.”

The first thing to consider is how the person in question is being paid. If someone is pulling a salary, Gottsman says, I generally don’t need to tip them. Think: my doctor, my attorney, my dentist, my accountant, et cetera.

“You do not tip anyone who is a professional,” says Thomas P. Farley, an etiquette expert who goes by Mister Manners. “These individuals, we presume, are well-compensated for the roles they play in our lives. There is zero expectation in those situations of tipping.”

It’s different for workers who are paid hourly or rely on tips as part of their pay. The government requires an employee who regularly earns more than $30 a month in tips has to be paid only $2.13 an hour in direct wages if that, plus the tips, equals at least the federal minimum wage of $7.25.

In these roles, tips are crucial to someone’s compensation. (Think: my bellhop, my valet, my Uber driver.)

I may also want to consider the specific scenario I’m in. If I’m at my local cafe, and they simply hand over an iced coffee and throw a doughnut in a bag for me, Gottsman says I shouldn’t feel pressured to tip.

But if “they’ve poured you six cups of coffee, given you two dozen doughnuts and you've held up a line because your 4-year-old can’t make up her mind,” that’s a whole other story. Ditto if that worker is doing something I don’t want to do, like delivering a pizza to my house in the rain or moving my couch up four flights of stairs.

Typically, however, just because I have the option to tip doesn’t mean I have the obligation to tip.

“It’s still discretionary, though it may not feel so,” adds Farley, who recently gave a TED Talk on tipping.

Often, the employees don’t love it, either. Farley says many small businesses use tablets for payment technology simply because it helps them streamline transactions — and attract hospitality workers at a time when it’s difficult to hire folks in the industry post-pandemic. But digital tipping systems also come with a lack of transparency.

“When you were at the neighborhood ice cream shop and there were high school students in an AC-less parlor scooping ice cream and there was a glass tip jar where you could drop a dollar or two, you had a pretty good indicator the cash was going to the people behind the counter,” Farley says.

But we don't really have that anymore.

As Vox points out, the payment systems loaded onto those tablets typically make money by taking a percentage cut from each transaction, and the larger the transaction, the larger the cut. So the companies that make these systems want me to tip — sometimes the on-screen messaging is even designed to goad me into it.

This can have ramifications. People who do historically rely on tips, like servers or massage therapists, may suffer because of tipping fatigue elsewhere, Farley says. The more we’re expected to tip on simple purchases, the less willing we'll be to do it when it matters.

Gottsman underscores that, ultimately, tipping is my decision. Like signing up for The Bachelor, it’s something you should do for the right reasons.

Gratitude, not guilt, is the move here — and that’s why there’s nothing wrong with skipping a tip (in certain situations).

“Not tipping doesn’t mean you're not leaving a gesture of kindness. It simply means this was a business transaction. You were polite; they were polite,” Gottsman says. “It’s OK to forgo that option, and you won't be doing anything wrong.”

It’s fine to skip tipping salaried professionals who don’t rely on gratuity for their compensation — or when a transaction is a quick and easy one.

Even though it may feel AWK, I should feel empowered to choose when I do and don’t tip. It’s not bad manners.

“Just because that option pops up does not mean that it's mandatory or that you should feel bad hitting ‘no tip,’” Farley says.

Dwayne “The Rock” Johnson is on the precipice of becoming the highest-paid actor in Hollywood thanks to the $50 million check he’s reportedly getting for starring in an upcoming Christmas movie. That’s impressive, especially when you consider his financial journey. “In 1995 I had $7 bucks in my pocket and knew two things: I'm broke as hell and one day I won't be,” he tweeted in 2011. “#UCanAchieveAnything.”

See you next week.

P.S. What’s your rule of thumb on tipping? How do you decide when to leave a few bucks? Do you have a favorite summertime dessert recipe? Send feedback to julia@money.com.

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