Thoughts on Tipping

Tip: A small sum of money given to someone for performing a service; a gratuity.

In the ‘good old days’ in the hospitality industry, a tip was precisely that and most often around 10% of the service cost. It was the catering trade who wrecked the system in the UK, behind the scenes support staff felt waiting staff should share tips with them thus ‘tip pools’ evolved. Once things became organised the bosses adjusted pay rates downward as the staff were making good money from the tips provoking the staff into demanding a ‘guarantee’ on tip income, thus the ‘automatic gratuity’ was born and somehow, in restaurants at least, managed to grow to 12.5%.
As in most things the USA went further, the ‘automatic gratuity’ there seems to be around 18%, ouch!

Thus, what was once intended as a way of saying ‘thank you’ for being particularly nice/efficient/prompt etc has become an expectation merely for performing the task.

Clouding the issue further is the huge difference in the cost of living between our world and that of the Philippine people. A quick example here, the girl sat at the checkout in the supermarket for 10 hours a day, 6 days a week is lucky to have the job yet she takes home UNDER P200 a day. Contrast this with your ‘bride de jour’ who has already received P5-600 from the ‘EWR’ – 3 times what she would earn in a ‘regular’ job. In 2005 the average pay of newly qualified nurses in the RPI was no more that P6,000 a month (P250 a day), a data entry operator managed just over P6,000 a month whilst the elite Systems Analysts averaged a whopping P23,000, yes, still under P1,000 a day. Armed with this knowledge, a ‘customary tip’ would be around P100 to P200 (10 – 20% of the service cost) and that’s being generous as we’ve included the ‘barshare’ in the calculation. Remember, that P200 ‘tip’ is more that the cashier ears a day ‘gross’! Our new member ‘boeby’ talks of the costs of a shag in Amsterdam, some $100, and feels that P1,000 plus is a reasonable tip in Angeles. I wonder if he ‘tips’ his Amsterdam girls $200 after paying $100 for the service?

I would argue that any tip should remain no more than 20% of the service cost AND be given for good service rather than automatically. I would go further by suggesting that gross over-tipping is in fact unkind. We all know how difficult it is to live on a reduced income, whatever your income level you become accustomed to it. Consider for a moment what we are doing to these girls, sooner or later they will be forced to leave the life, what happens to them when they have to get a regular job?

Not only are we making the girl’s life difficult we are also distorting the local economy, we all have our favourite Papasan, an expat often eking out his pension by managing a bar for under P1000 a night. If we visitors have trained the girls to expect P1,000 plus a night for their ‘charms’ we will eventually price the poor guys out of the market!

Tips for EWRs should be tips not ‘Golden Handshakes’ and unless an additional service has been rendered a tip should be no more than 20% of the service cost based upon local pricing

Waitress tipping is also a minefield as using the 10-20% rule here can be a little silly. Lets take the example of a group of 3 or 4 guys out barhopping, one bill could easily be P1000 plus, particularly if there are a few LD’s. Is P100 – 200 realistic as you’d be giving her an extra day’s wages in one hit! I tend to work on the basis of P20 – 50 max.

In restaurants I work on the basis of ‘persons served’ between P20 & P50 a head so a luxury restaurant with a party of 4 it would be at least P200 as tips are often pooled with the ‘back office’ i.e. kitchen. I’d be interested to hear Chef Chris’s comments on this one.

Remember guys, a tip should be a ‘thank you’ not a poisoned chalice.

– Binro

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