Okay, save your downvotes. I absolutely hate predatory tipping. Particularly in areas where they are doing no work such as handing you a donut or cookie or take out.

HOWEVER, last night I had an experience that reminded me that although tipping is out of control and has gotten too high and spread to too many industries, if you eliminate tipping, you also "pay the price" (pun intended), in terms of service quality.

An economic principal is at play here... People will do what they are financially motivated to do. Ideally people would work for passion or kindness but that isn't my experience. Remember, economics is not the study of money, it is the study of INCENTIVES.

Some background... I lived in Brazil for 7 years. In Brazil, tipping is an automatic 10%. There is no blank to add more, and if you want to remove the 10% technically it is legal but it is a very uncomfortable argument. The problem is that because the tip is automatic, waiters in brazil do not go the extra mile because they are not incentivized to do so. I have had dozens of arguments. In the US, you can ask "can you swap fruit for fries," or whatever. Usually the server will do it. In brazil, the answer is always "no" or "yes but it will cost more." I had a 10 minute argument with a guy about a pastel. The Pastel included 3 ingredients: cheese, egg, and tomatoes, but I wanted to swap the tomatoes for corn. He said, "it's an extra charge." I said, "no, I am not adding an ingredient, I am swapping and corn costs less than tomatoes." But since no tip was on the line, he didn't care. In the US, people will bend over backwards to please you.

So last night I went to a restaurant called "The living room." They make a huge deal (to the point of it being uncomfortable), about how they are changing the tip paradigm by automatically including 20%. They have a stupid laminated placard at every table explaining this, and it is on their website and they presented at the Florida restaurant meeting and are trying to get everyone to adopt this. They say, "if you go to buy a used car and it doesn't go the way you planned, it doesn't impact the salesman's livelihood." Their logic is why should restaurants be any different, why should a server get punished because the kitchen messed up your order? Poor logic because a car isn't in the hospitality industry.

Well, as per my earlier point, no incentive for tip means no incentive for good service. Surprise surprise, it was the worst service I've had in 10 years. First, the lady didn't automatically refill water. I asked her for water twice because my food was quite spicy, she forgot both times so I just stole my buddies drink. Although, she didn't forget to try to upsell us expensive liquor even though I said no thanks (probably doing the 20% math in her head). They forgot to bring my food, she didn't notice, when I asked about it she said, "sorry it was a mistake, we are making it right now," so it came after everyone else had finished their plates. My friend at the table works at corporate for Bloomin' Brands (Outback), and said that standard procedure would have been to comp my plate due to the lateness but again, that would hurt her 20%, right, so no dice. There were several other missteps.

By the way, when the check came, the 20% was included but they still included a blank for additional tip. If you really believe in this auto 20% deal, then you need to commit to it and not add an extra blank. Particularly since the desire for an additional tip on top of the 20% clearly wasn't motivated the server I had. Just pick a lane. Needless to say I did not add anything on top of the auto 20%.

Clearly we need to figure out the tip conundrum, but there are downsides to not motivating people financially.


By the way, here is a quite hilarious clip on tipping if you have 4 minutes that points out the ridiculousness of the whole thing.

https://www.youtube.com/watch?v=6ReJJkHPTL4