[New York Diary] "I Had Brunch and Was Asked to Pay 30% More?" Tired of Tipflation

Stories from Everyday Life in America, Straight from New York

Here is a notice. "Thank you for visiting our store. A 20% service charge will be applied to your bill. We suggest additional tips of 2%, 3%, or 5%." The title of this notice is ‘Tipflation (Tip + Inflation) Does Not Stop.’

There is another cartoon. It shows a man who ordered a drink at a cafe standing in front of the register, hesitating as he looks at the kiosk screen presented by the employee. He only bought a takeout coffee, but should he leave a tip? On the screen, large tip buttons show ‘20%’ and ‘25%,’ and below them is a small ‘no tip’ button. However, under the no tip button, it says, ‘You may be criticized and spat on the drink you ordered.’

These are all memes mocking the tipping culture that has surged alongside high inflation in the United States. Emily, a 30-something office worker from Louisiana who has claimed that her country’s tipping culture is "absurd," shook her head when asked, "When was the last time you were not asked for a tip when purchasing something?" She said, "I don’t even remember." I personally hesitated at the same question. On the other hand, both of us had a clear answer to when we were explicitly asked for a tip: just 10 minutes ago.

A few years ago, tipping was generally considered to be about 15% when receiving satisfactory service at places like restaurants or hair salons. But now, it is harder to find service industries that do not ask for tips, from takeout coffee to unmanned kiosks. During the pandemic, as kiosks and tablet payment systems spread, it became a familiar scene to see a tipping screen appear at the final payment step. The U.S. payment system company Square revealed that the percentage of remote transactions with tips was 43.4% in February 2020 before the pandemic, but it soared to 74.5% in February this year, three years later.

Especially since last year, when inflation appeared for the first time in decades, the tip amounts have jumped significantly, making it even more burdensome. I remember sighing involuntarily when I saw 25% and 30% options pop up after dining at a brunch place.

Usually, these numbers can be set by the store. You can pay only the percentage or amount you want, but to do so, you have to press several buttons while standing right in front of the employee. In the end, out of unnecessary guilt and feeling rushed, I have pressed the first number many times. This situation is called ‘guilt tipping’ in the U.S. Eunbyeol Kim, a 30-something office worker who moved overseas to New York for work, complained, "Tipping culture is supposed to be for the service received, but demanding at least 18% just for handing over coffee is ridiculous."

[Image source=AP Yonhap News]

Michael Lynn, a professor at Cornell University who studies consumer behavior, analyzed, "Research shows that the more you ask for tips, the more you get," and "Tip options starting at 18% generate higher revenue." Simon Peck, associate professor at the Gustafson School of Business, said, "Companies facing labor shortages were looking for ways to provide additional value to employees, and tipping was a relatively attractive way to compensate employees while shifting responsibility to consumers." The discriminatory wage structure in the U.S. that gave rise to tipping culture is itself a problem, but ultimately, it is hard not to think that employers are passing their burden onto customers.

Recently, there has been a noticeable increase in fatigue and resistance toward tipping. Emily said, "I often buy food to-go rather than dining in because it reduces situations where I have to tip." On social media, videos and posts expressing this ‘tipping fatigue’ are gaining popularity. However, recognizing customers’ resistance, other expressions disguised as tips have appeared on bills, such as ‘service charges,’ ‘gratitude,’ and ‘wellness fees.’

Not long ago, I received a bill with a service charge included at a restaurant in Brooklyn. When I asked the staff if the service charge meant a tip, he replied, "No, it’s for the hardworking kitchen and floor staff." When I asked if that wasn’t a tip, he said nothing. If I hadn’t checked the bill carefully, I would have ended up paying a high tip on top of the amount that already included the service charge. The Washington DC Department of Justice recently sent letters to local small businesses warning that such vague fees are ‘deceptive charges.’ Anything excessive inevitably backfires. I have not been back to that restaurant since.