‘A bit of a Wild West’: Navigating the changing rules on when to tip

“If someone came in here and said, ‘Mike, what happens with tipping in Canada?’ I’d be hard pressed to give them a definitive answer to where you tip, where you don’t tip, and also how much to tip.”

It’s hard to know the rules because they are unwritten, and changing rapidly.

Some of us don’t know a tip is expected until a payment machine is handed to us and we receive a prompt. This technology is credited with both “tip-flation” and “tip creep,” von Massow said — the former references prompts for higher amounts, pressuring us to tip more; the latter means more businesses and services expect gratuity, when historically they haven’t.

This has led to tip fatigue. An Angus Reid Institute survey last year showed 83 per cent of Canadians thought too many businesses were asking for tips. Sixty-two per cent of respondents said the prompts are asking them to tip more money.

A majority of Canadians now prefer higher wages for staff instead of a tipping model,according to the survey. Interestingly, the preference was almost identical among those that had worked gratuity-earning jobs in the past.

The meaning of the gesture has been lost, survey respondents said. The original intention to reward good service has been replaced with the perception that employers are using it to supplement lower wages, according to 73 per cent of Canadians.

Von Massow agreed — to a certain extent, the responsibility to pay well has been offloaded onto the consumer.

As an unwritten social norm, it’s hard to know what to do. We might hear from our acquaintances, or chatter online. But that’s not always fair to the consumer, said Marc Mentzer, professor of human resources and organizational behaviour for the Edwards School of Business at the University of Saskatchewan.

“On the internet, there’s a bias towards encouraging people to be generous — you know, often it’s people who are restaurant servers suggesting a higher percentage,” Mentzer said.

“I think people who take the position of ‘I’m fed up with this’ — they’re unlikely to post in social media. So there’s a bias in looking in social media to see what the consensus is.”

For decades, 15 per cent was the expected tip for dining out, Mentzer said. That etiquette started around the 1960s and stayed in place for about 50 years until payment machines became more prevalent – then the COVID-19 pandemic changed the game again.

Many people sympathized with the struggles of restaurant and service industries during the pandemic and began tipping those workers more generously, Mentzer said.

“When COVID first began, there had been some speculation that maybe this would cause people to reconsider how irrational tipping is as a way of paying employees,” he said.

“And there was hope that maybe this would cause some sort of cultural reset. And as we’ve seen, it’s had the opposite effect. It’s caused tipping to become more entrenched, expanded to new occupations, with a higher percentage.”

In practice, tipping often doesn’t fulfil its intended purpose. It fails in two areas, von Massow said.

In terms of good service being rewarded, that doesn’t show up in how we actually tip — we tend to be creatures of habit.

“In the research, there’s very little indication that there’s any relationship between quality of service and the size of the tip,” von Massow said. “Most of us tip within a very narrow window.”

Secondly, tipping expectation from servers can lead to profiling customers based on race, gender, age or family status. If an employee believes you might not be a good tipper, von Massow said, they may not provide the same level of service.

“People of colour, women — particularly younger women, families, all get poorer service,” he said. “A middle-aged white guy like me, particularly if I’m wearing a suit, will get great service, regardless if I’m a good tipper or not.”

Even deciding not to order alcohol can change a server’s perception of you, von Massow said.

Ordering alcohol brings the bill much higher, he pointed out, and therefore the tip percentage jumps significantly in value as well.

There are pitfalls for servers as well.

Some have to tolerate bad behaviour and harassment in order to not lose tips, a key source of income, Mentzer pointed out. And some restaurant managers can play favourites with staff by giving them the best shifts and most tables, von Massow said. Two employees at the same job might have vastly different earnings.

Ultimately, consumers should take control and tip where they feel comfortable, both Mentzer and von Massow said. Budgets are tighter now for many Canadians facing cost-of-living increases.

“Tipping isn’t a law, it is a social norm; you are completely in control,” von Massow said.

“We have to, as Canadians, get over our guilt and say, ‘If I have a good experience, I’m going to tip and I’m going to decide myself what is reasonable.’ And if you go into a restaurant and their prompt is 25, 30 and 35 per cent, and you think that’s outrageous, take 10 seconds to opt out and tip them what you think is reasonable.”

This report by The Canadian Press was first published June 11, 2024.