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>It's the same thing with unionization, unionization is beneficial for workers, yet everyone keeps undercutting each other to stay afloat and meet their obligations. Because people can not properly cooperate and work together you are stuck in this bad equilibrium where companies have so much power over you.

This is very true, the "best" (or should I say most succesful?) unions are those that have a monopsony (they control all the supply and there is only one buyer). The only recent victory I can recall is that airport workers are guaranteeda $19/hr minimum wage [1].

The other dimension that is brought on is that unions tend to be "corrupt" with the leaders taking advantage of their positions to "extort" money if they don't get favorable deals; some of these leaders also just pocket their earnings and don't spread the wealth. The mafia also infiltrated many of the unions in shipping and distribution to control the flow of drugs which has sullied the reputations of many unions in New York. [2]

[1]https://www.nytimes.com/2018/09/27/nyregion/airport-workers-...

[2]https://www.justice.gov/criminal-ocgs/infiltrated-labor-unio...

> it’s the same with tipping

Nowadays it’s even more ridiculous with payment terminals all set to 15%, 20%, 25% options and to tip $0 you have to go to “custom amount” and type 0. The most idiotic part about it is that most of the places that use this practice provide no service at all! You pick your food! You clean after yourself! What are you tipping them for???

Over the last five years or so I've noticed this movement where restaurants think it's cool to make the customer do the work. Wait in line and order, no table service, then walk to pick up your own food cafeteria style and finally to top it off bus it to the trash. Add to that have they charge you the same prices that a table-service restaurant would AND have their payment terminals setup as you describe. So I ask myself every time I unfortunately find myself in one of these restaurants, why would I tip for doing all the work? If I do tip, who is receiving the tip? I'm guessing it's not the people doing the work, i.e. the kitchen staff.

This isn't because it's "cool." It's a side effect of higher wages in some cities. Restaurants can only raise prices so much, so they find ways to get by with less staff instead.

But I somewhat prefer this way, actually, since you can leave quicker.

I haven't heard of any cases where the money doesn't go to staff, have you? That seems rather illegal.

Amy's Baking Company

https://www.youtube.com/watch?v=pvc_BfG45VU

Agree with the point about tipping. As for why this is happening see https://www.nytimes.com/2018/06/25/dining/san-francisco-rest...

By your description of the problem it matches better the "Tragedy of the commons" (https://en.wikipedia.org/wiki/Tragedy_of_the_commons) than a self-fulfilling prophecy.

A self-fulfilling prophecy would be if the belief that unions fail to help workers made them fail to help workers (which also happens).

>>The problem is that people that are tipping and servers that are encouraging the tipping are keeping the problem alive.

The institution of beggary is surviving in India for the same problems.

The government even has beggars cess, taxes to train beggars into a decent profession.

Nothing works because some one always pays, and therefore there is an incentive for it to continue.

What's the "problem" with tipping?

I think it's somewhat insidious in that it forces a confrontation between workers and customers and the benefit goes to the owners. it also gives the impression that the product (lets say food) is 20% less than what is printed. yes I u/d tipping is optional, but it is more or less expected (at least in nyc) and you can be ostracized if you don't participate.

It’s not just expected - the servers are not making a living wage without it.

This should not fall to the patrons. This is the problem of the business model. Remove tipping as an option, price the meals, and pay the employees a wage.

who are you advocating for here? if you're actually concerned for the servers, you might consider asking some of them for their opinion on tipping. most servers that I've talked to (including myself) actually like the system.

Some make good money and like it. Some would rather have more consistent pay and less emotional labor. Some think it's good for them but unfair to the back of the house. Some have seen it facilitate wage theft and hate it.

I'm not the OP, but I'd advocate changing the minimum wage law to be the same for waiting staff as it is for every other job. You can still allow tipping. Here in the UK a 10% tip is customary if you were happy with the service, and I know plenty of people who do very well out of tips.

over a single pay period, servers are guaranteed minimum hourly wage regardless of tips. if minimum wage is less than a living wage, that's a separate issue that applies just as well to gas station cashiers.

Why don't restaurant owners increase the food prices and pay servers a fair wage? Opening a $100 bottle of wine or $400 bottle of wine requires same effort, why do i pay extra for a $400 bottle of wine?

Now if you bring up the "service" provided argument, That is literally their job. If they are getting paid a decent minimum wage or little bit more than that, i think it's fair. Do you tip McDonald's employee? Do you tip your garbage men? Do you tip the people who helped you at the clothing store?

> why do i pay extra for a $400 bottle of wine?

Because you can afford a $400 bottle of wine. It’s a wealth-based sliding scale.

You are doing exactly same amount of work. It already is ridiculous to pay $20 to unscrew a cork and you are saying i should be paying $80 for a person to unscrew a cork just because the bottle itself costs more?

I like the spirit of what you're saying but your tone is not acceptable by HN standards.

fair, edited the comment.

Imagine telling this to a developer with 10 years of experience versus one with 1 year of experience that you've contracted to do the same job. It's no different. There's so much more to the story of the server than "the same amount of work". Most servers that work in a place selling $400 bottles of wine have a lot more knowledge, service quality, expertise, etc. than you'd find elsewhere.

If you don't want to participate in the culture, don't go to places you would be upset doing so.

Affordability is not the issue. Just because I can afford to pay all kinds of things does not make the justification for charging it. They're separate matters.

> Why don't restaurant owners increase the food prices and pay servers a fair wage?

A lot of good waiters make more with tips. A "fair wage" from the restaurant owner's perspective would be a bit less than how much they pay a line cooks (~$14/hr). A waiter at a semi-popular restaurant can make much more than this because the customer doesn't know fair value of their work and usually overcompensates. Waiters can also cheat on taxes a bit when people tip in cash.

And none of this strikes you as a problem?

I worked as a server in an American restaurant when I was in college (not long ago).

my perspective as an employee: I definitely would remember which customers tipped well. anyone who walked into the restaurant would at least get the minimum treatment my boss expected, but I would often go above and beyond for people I knew tipped well. I usually averaged around $12-15/hr after tips, in a state where the minimum wage was $8.50 or so. this is just speculation of course, but I really doubt I would have made that much money if it had to come direct from the business (ie no tipping culture).

my perspective as a customer: tipping allows me to decide whether I want to pay extra for good service. if I just go to some restaurant occasionally, I'll just tip 18% or whatever and they at least won't spit in my food. on the other hand, if I go to some place all the time, I can tip 25% or more and get great service every time I go.

tipping allows people who care about good service to pay for it, and it allows servers to allocate more of their time/attention to their best customers. having experienced both sides of it, I'm really not sure what the problem is, unless you're just visiting and don't understand the system.

See i get it in US why tipping exists. I'm from Canada and our minimum wage isn't that bad. Like i said, it would be much better if restaurants owners reflected this cost in the prices for the food and every server made decent minimum wage. And frankly things have been getting ridiculous where a lot of machines have tip preselected to 18%. If i go to a coffee shop and order a drip coffee to go, they expect me to tip.

And i like how you conveniently ignored the last paragraph. Do you tip any of the people i mentioned? Because, frankly a garbage men's services are way more useful and needed than a servers. Why do servers deserve a tip and not people working at clothing store? Or people working at Walmart?

I didn't have any ulterior motive behind not addressing your other points; mainly I just wanted to share my perspective on things that I actually have experience with. I'll take a stab at a response now.

first of all, mandatory tipping at a coffee shop or takeout place is dumb. afaik, these are not legally considered tipped positions and the employer is not usually allowed to count tips toward minimum wage. that said, I certainly recommend you throw a little extra in their tip jar if they actually provide outstanding service.

> Do you tip any of the people i mentioned? Because, frankly a garbage men's services are way more useful and needed than a servers. Why do servers deserve a tip and not people working at clothing store? Or people working at Walmart?

I don't claim that the tipping system is inherently moral or immoral. my claim is that it is a practical way to align incentives in a particular set of situations. in a restaurant, the difference between acceptable and great service is quite large. if I'm handling several tables, I'm usually going to get to the tables that tip well first. I'm going to make sure they're not in the middle of a deep conversation when I go over to check if the food is okay. there are tons of subtle things that a skilled server can do to improve your dining experience if they are incentivized.

garbage men, on the other hand, either pick up your trash or they don't. idk what the difference between a good and a great garbage collector is, maybe the great one takes the time to leave my can sitting upright? a cashier can ring you up fast or take their time, but can't really affect your experience other than that.

I do actually agree that maybe some retail positions should be tipped. I find that usually Walmart employees don't give a shit whether I find everything I'm looking for. occasionally one of them is super helpful and saves me 30min or more of hunting around the store. in these situations I try to slip them a couple bills. if they refuse, I make sure to find their supervisor on the way out and explain that they made the store a lot more money by helping me find my things.

In general none of this is really the case though. The people who tipped you well were probably just good tippers. Now maybe you do make objective judgments about the quality of service that you receive, but the general population doesn't.

https://www.marketwatch.com/story/tipping-doesnt-reward-good...

https://scholarship.sha.cornell.edu/cgi/viewcontent.cgi?arti...

I've read similar studies before. I certainly believe that customers aren't objective judges of service quality, but I simply can't believe there is no correlation between tips and service quality. everyone in the front of house knows who tips well and treats them at least a little differently.

I suspect the causality is reversed. rather than good service being rewarded by good tips, people generally tip the same amount wherever they go, and after a while they start to get recognized and receive better service.

Because a "fair" wage is not merit based and most servers would leave the industry if they were not tipped. I was a server for over a decade, and a very good one at that. I did very well for myself, especially compared to similarly skilled labor. You pay more for a $400 bottle of wine because you decided to go to a restaurant and buy a $400 bottle of wine. If you don't want to do it, don't go. You're paying for the labor and service in the tier of restaurant you're at. Not just the act of opening a bottle of wine. The type of servers that work in places that serve a $400 bottle of wine are going to be a lot better than the person that works at Applebees. They're going to have extensive menu knowledge, usually know a lot about taste profiles of their food and beverages, multiple years of experience, etc. It's no different than freelance developer work.

Compare the quality of service of people that do "their job" to those that are rewarded for doing their job exceptionally well on an individual basis. Serving food table-side is participating in one of the most intimate rituals of human existence. It's in a whole different tier of customer service than fast food, clothing, etc.

Do you have any idea how much restaurants would have to raise their prices to pay a "fair wage"? Enough to where the number of servers they could employ would fall dramatically, not only disincentivizing great service, but also the pure availability of it. There are razor thin profit margins on food.

All true:

- The system we have is internally consistent, which your comment very ably pointed out.

- Restaurants are incentivized to employ workers whose pay falls under the "tipped workers" regulations.

- Americans are used to tipping, and we understand the trade-offs, and those of us who don't work for tips (like you and me) generally like a tipping-based system. What's not to like about a system that gives us the power to control or punish service workers according to our whims? ;)

Finally, citing profit margins as the reason to artificially depress payroll obligations of employers to employees might be accurate, but it's also a great example of how the system is broken: Why do restaurants exist that can't afford to pay their workers a fair wage?

The same as the problem with not including the tax in the price up front: it hides the true cost behind a series of computations that most people won't do and a tourist certainly cannot do without research.

It is essentially a trick to get people to not think about how much money they are spending.

Because it sows division amongst subcultures of the US that dont subscribe to the tipping culture. You have people in the lowest socioeconomic classes validating their disdain for some minorities because they don't tip, instead of affecting change to wage system itself, this is a useful distraction for people in higher socioeconomic classes.

In places like Miami where English comprehension is very low, mandatory gratuity is added with a further line item for tipping

Disparate hospitality minimum wage excecptions across the country exacerbates the level of research and discretion needed to adequately consider tipping. With some places paying a seperate lower minimum wage to restuarant workers and some places like California (where over 10% of the country lives) having normalized minimum wages but the same compulsory guilt driven tipping expectations.

It shouldn't fall to me to pay a business's employees directly. The business should pay its own employees.

Technological innovation can also arise as a consequence of the minimum wage being high. By increasing the cost of human labor, automation becomes relatively cheaper / more cost effective.

Here in Norway this has led to the near complete elimination of classes of jobs. As a very visible example, we have no toll booth operators or garage attendants, these have been universally replaced by automatic license plate recognition.

Thankfully we have a (relatively) good social safety net to take care of those who lose their jobs to such things.

I feel strongly that any economic system where automation is bad for laborers is fundamentally broken. Each automation should lead to shorter work hours for someone, without loss in pay, because it's not like the productivity has gone away.

Shorter work hours for who?

If I start a parking lot business, and want to put automatic gates, am I supposed to pay someone for the productivity of that automatic gate? And why should I have to do that?

A basic income would solve this kind if problem without putting the burden on individual businesses...

I agree with you, I just want to know what he's proposing.