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Is Tipping Getting Out of Control?

Know when, and when not, to tip

spinner image Closeup as a customer hands over five dollar bills to a server carrying a tray.
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If you feel like requests for tips are everywhere, you’re not alone. From dry cleaners to shops, prompts to provide a gratuity are popping up in unusual places. 

Tipping has long been part of American culture, expected in restaurants, hair salons and taxis — anywhere workers rely on them for a livable wage. An explosion of digital point-of-sale terminals and contactless checkouts has resulted in even more requests for tips. 

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It can be frustrating and annoying for consumers who don’t want to give 20 percent for a $5 purchase at the convenience store every morning. Nearly 2 in 3 (66 percent) of U.S. adults in a Bankrate survey said they have a negative view about tipping. 

And it’s not going unnoticed. New polling from the Pew Research Center found 7-in-10 U.S. adults, or 72 percent, said they’ve witnessed an uptick in the number of places they are expected to tip at compared to five years ago. Of those surveyed, only about one-third say it’'s extremely or very easy to know whether and how much to tip. The new prompts to tip can be frustrating and annoying for consumers who don’t want to give 20 percent for a $5 purchase at the convenience store every morning. Nearly 2 out of 3 (66 percent) U.S. adults in a Bankrate survey said they have a negative view about tipping. 

Among the respondents:

  • 41 percent said businesses should pay employees better
  • 32 percent expressed annoyance at seeing pre-entered tip screens
  • 30 percent feel the tipping culture is out of control
  • 15 percent are confused about whom and how much to tip
  • 16 percent would be willing to pay more in lieu of tipping

“The tip jar used to sit quietly next to the register … now the tip screen actively asks us to say ‘no,’ ” says Lizzie Post, coauthor of Emily Post’s Etiquette: The Centennial Edition. “It’s a harder hurdle to get over.” 

People grew accustomed to tipping during the pandemic to help small businesses and restaurants stay afloat. In turn, more businesses added the ability to tip to their point-of-sale terminals and — voilà! — a new tipping culture emerged. “Now that the Pandora’s box has been opened, you can’t really shut it again,” says Jaime E. Peters, assistant dean of accounting, finance and economics at Maryville University in Town and Country, Missouri. 

But just because you’re prompted to tip everywhere doesn’t mean you have to. There are times when it is absolutely necessary and other instances when there’s discretion. Here’s how to navigate the new tipping culture.

When to tip 

Tipping used to be a way to express gratitude for good service, but it was codified by the government years ago when it allowed workers in certain professions to make a small hourly wage and get most of their income from tips. In those jobs, which include waitstaff, delivery people, taxi drivers and bartenders, tipping is required. “You are tipping to help pay their wages. In a lot of ways, what you are doing is renting their time,” Peters says. 

In those instances, a 15 to 20 percent gratuity is the standard, even if the service did not meet your expectations. A tip is anything above that 15 to 20 percent, she says.

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A majority of survey respondents — 57 percent — in the Pew Research poll said they would tip 15 percent or less for an average meal at a sit-down restaurant. Only one-quarter said they would tip 20 percent or more. There is a caveat. Some states, including Alaska, California, Minnesota and Nevada, require all workers to be paid the state’s full minimum wage. Several other states require businesses to pay tipped workers a minimum cash wage above $2.13 an hour, which is the minimum cash wage set by the federal Fair Labor Standards Act (FLSA). Those changes put the onus on the customer to figure out whether a tip is necessary. Tipping is no longer U.S. culture; it’s becoming per-state culture, Peters says. ​​​

States that pay tipped workers full hourly minimum wage

Alaska — $10.85

California — $15.50

Minnesota — $10.59 for large employers (annual gross income over $500,000); $8.63 for small employers (annual gross income under $500,000)

Montana — $9.95 for businesses with gross annual sales over $110,000

Nevada — $10.50 for employers not offering qualified employees health insurance; $9.50 for employers offering health insurance

Oregon — $13.50

Washington — $15.74

When it’s discretionary 

If you feel guilty about not tipping the cashier or the person who brings your groceries to your car, don’t. Tipping in these situations is more discretionary than obligatory. In some instances, tipping is even frowned upon. “Generally, at retail stores and grocery stores, their policy is not to accept tips,” says Diane Gottsman, an etiquette expert and owner of the Protocol School of Texas. “Workers know the policy and could get in trouble for accepting.” Gottsman says to check the store’s policy before offering gratitude in the form of cash. Walmart and Harris Teeter don’t want you to tip, but Target and Starbucks don’t have specific policies on the books.

As for establishments that let their workers accept tips, it’s completely up to you, even if you are prompted at checkout. If you press “No” or skip the prompt, don’t feel guilty — the person doesn’t rely on tips to earn a livable wage. If you think the person put in the work and you’re grateful for their service, by all means, tip. 

“Tipping doesn’t have to be $20 for every person that slightly assists you,” Post says. “It’s often a very small token amount. It’s a gesture, a way to add to your thank-you.”

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