Two more restaurants in Toronto just got rid of tipping | Hacker News Reader

Two more restaurants in Toronto just got rid of tipping

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36 pointscolinprince80 comments

No, they did not. It is more accurate to say two restaurants in Toronto just mandated 18% tipping:

>Tips will still be split between front and back but Ten will now be "adding a flat untaxed 18 per cent service charge onto each bill no matter the size of the group,"

The more sensible thing would have been to increase menu prices by 18%. But they are not being sensible. They just increased their prices while pretending they have not done so. I hate it when you have to treat a menu like a legal document and be looking for the fine print.

and while we're at it, include the taxes!

I think separately listing taxes has the benefit of transparency - you know how much the government is taking and can make more informed electoral decisions.

I wish they made it in LCBO reciepts, so we could see that sweet almost 100% tax on alcohol.

With a single Federal Goods and Services Tax (GST) as in Australia, you know it is 10%. All prices include the GST and are the price you will pay. There are no other sales taxes. Everyone knows what the government's cut is. Everyone knows how much they are actually paying. I can't see why anyone would want a more complicated system.

Clarification: Many "essential" goods like simple foods are GST exempt. They will be marked as such on the receipt. Again, the price on the shelf or box is what you will actually pay. There are no hidden surprises.

Though there are still some special cases where they sneak in extra taxes - stamp duty on houses and import duties on cars for example.

Is it 10% in all states?

In Canada, the provincial sales tax differs in each province. The federal rate is 5%. Alberta has no sales tax, whereas Ontario charges 8% (post-harmonization it's a HST of 13%).

In the US, the sales tax differs not only by state, but by county and city.

The tax situation in Chicago is particularly bizarre.

The sales tax in Cook County, where the city of Chicago located, is 10.25%. The sales tax one county over (say Dupage County, 15-20 miles outside the city and still part of the greater Chicago metropolitan area) is 8%.

Restaurants in the City of Chicago (but not other parts of Cook County) charge 10.75% because there's a city-specific restaurant tax.

The different tax rates create strange arbitrage opportunities. If I buy an iPhone from an Apple Store a few miles outside Chicago, I get an automatic 2.25% discount.

I wonder why does harmonization always infer a higher tax than the previous one. If we'd had harmonized VAT in Europe I guess it would be like over 20% and those with 19% or lower would end up paying more.

The harmonization in Ontario is more like combining the 5% federal rate and the 8% provincial rate into a single combined rate of 13%, so there’s no change in this case.

The 10% tax is at the federal layer in Australia and is the same across all states and territories.

FWIW, Canadian taxes are similarly quite uniform within a province.

Canadians also have a Federal GST, and provinces add their own tax, which gets added together into one Harmonized Services Tax (HST) in all provinces but Quebec and British Columbia, which have their own rules (QC collects an additional Provincial Sales Tax (PST))

Of course, there are fun additional taxes as well like the Environmental Handling Fee (EHF) on electronics.

In the US, there are different state, county, and local taxes depending on your location. There is no way to memorize a single number and have it be correct everywhere.

Not sure why this got downvoted. Absolutely you should know what you are paying so you can make informed electoral decisions.

You can't assume "everybody" knows.

Covered in the article: "To me it really doesn't seem like too radical of a change, my hope is that after people get comfortable with this, we will be able to scrap a service charge completely and just increase our menu prices by 18 per cent and then pass that 18 per cent into higher salaries for all of our staff."

I hope it catches on.

Urbanite restaurant-goers aren’t so price sensitive that they can’t handle a price increase from $20 to $22. I think they’re doing it this way so that if it doesn’t work out, they already have the previous infrastructure in place to return to tipping if need be.

18% price increase during a pandemic? Wow. They have it in Hungary too, but it's 8% as far as I can remember, not 18%. But we didn't mind as in Budapest the service and the food was almost always excellent, even in a bar that served mainly cocktails but had some easy dishes so that the customer doesn't leave the place if they're hungry.

I don't like service tax. If you don't like the service you have no other option but to pay it. With tips you would just not tip and walk away.

It's not 18% price increase though. People normally already pay tips just not a fixed 18%.

People normally pay tips for a good service. Making tips mandatory provides no incentive to provide a quality service. If the service quality drops - customers will go elsewhere.

Every other service business that isn’t a restaurant doesn’t have tips and they seem to be doing fine. What is it with restaurants that makes workers only provide good service because of money? Do food service workers not have any intrinsic motivation to do a good job?

>People normally pay tips for a good service

People in the US and Canada (where this article is about) pay some tips unless they're pissed. I'm not saying this is ideal, just what it is according to my experience.

Again, the topic is about if this is a 18% price increase. My point is compared to the common practice pre-Covid, it's not. I have no argument about if it's going to decrease the service quality or not.

>If the service quality drops - customers will go elsewhere.

Wouldn't that be incentive to provide good service?

I ask because some of the best restaurants in the world do not expect you to tip - ie. Danish restaurants Noma and Alchemist.

I was talking about the North American model where staff are paid basically nothing and they live off of tips.

Europe is another story. Tipping there is not expected. And staff are probably decently paid.

It really depends which part of Europe you are talking about. In Eastern Europe and South Eastern Europe one is expected to tip and tips are typically 10-15% of the bill. In Greece you might also get rewarded if you visit the same joint more than a couple of times and tip. In Nothern Europe and Western Europe it's a different story, but meals are also considerably more expensive. In Central Europe and Southern Europe the staff doesn't expect tips but they will be quite grateful if you do tip them. Some places have a fixed service tax as it's the case with Hungary some have a sit down charge as in Italy (< 3 euros) but it's nowhere near 18%. Some enable you to tip a variable amount using the POS such as it's the case in the Czech Republic.

> The more sensible thing would have been to increase menu prices by 18%.

That would not be sensible because when people are comparing restaurants they will appear 18% more expensive than an identically priced competition when they aren’t.

> I hate it when you have to treat a menu like a legal document

I don’t know why you’d need to. I’ve travelled in Europe plenty, where restaurants charge a service charge. It’s right there in the receipt. I don’t know why this would be any different.

> It’s right there in the receipt

That's the main issue with it. It should be on the menu, on every page that contains prices. Once it's (only) on the receipt it's too late to pick another restaurant. In Europe they're required by law to list it.

That restaurant would def go on to a mental ban list. I hate when they do that. It’s like an extra sales tax. I want the total number, after all of the fees.

A true place I know that banned tipping is Crew Collective Cafe in Montreal.

It’s the same group that started crew.co and Unsplash.

I'm so happy to hear this. I cannot stand tipping and genuinely get anxiety when I'm out with friends and the wife and she sometimes pays without knowing what the right "tip amount" is.

It happens to me too, where I have to pay attention to what the waiter/waitress is doing that is exceptional or bad so I can adjust my tip accordingly.

It's bad for the customer and the employee, the employer is the only one winning by exploiting its own workers. I wish we would just pay our servers a living wage with health benefits and stop hiding those as "Extra surchages" as San Francisco is doing.

While we're at it, show me the final price with taxes included please.

You do not in fact have to pay attention to how well the server performs. You can just take the final price, divide by 10, multiply by 2, and round whichever direction you want. You should look at tipping as a cost sharing measure, not an incentive system.

Fascinating. Are we now at 20-23% (exclusive of taxes, as I think they're usually calculated, so the variance here is entirely how much meals tax you have on your meal) tip rates as the new normal?

15-20% has been the norm for my whole adult life, and the upper range (1) doesn't often materially change the price of a meal and (2) simplifies the math. Use whatever system you want, though; the point is: you are not actually on the hook to evaluate the server's performance. Think of it as tipping the institution of table service.

Oh interesting! My impression was that it was 10-15% about two decades ago and has now risen to 15-20% with most people I know tending closer to the 20% edge. Maybe it's simply that my social circles have become more generous tippers.

That's my impression as well.

It’s because wages haven’t been catching up with inflation for decades also. Not just food service, pretty much in every sector, maybe with the exception of tech.

Hasn't wage growth been even with inflation? I don't have sources at the moment, but that was my impression.

That's still not good (you'd hope for an increase in purchasing power), but not as bad as sliding backwards.

>Hasn't wage growth been even with inflation?

Definitely not: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...

The headline and article content both say that it's been even, i.e. no real growth, but no backsliding either.

> For most U.S. workers, real wages have barely budged in decades

and

> today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago.

Ah, yes. Sorry. Even with inflation but no growth. You would hope for growth given it’s been 40 years.

It just occurred to me maybe the reason some people find tipping so stressful, is that they think they're supposed to be grading someone with it.

Because in the US it's not like taxes are included either, and and the "default" tipping percentage is much easier to calculate than tax percentages.

I've lived in countries that tip and don't tip, it's honestly not a huge deal. The fact the menu says a service charge is included or not doesn't really change much at all.

I think people in the US (and perhaps visitors to the US) would be surprised how much more expensive high-end restaurants would need to be to account for tipping --- of course, what seems to be happening instead of tip abolition is just a mandatory standardized tip. Which is fine! It's the same thing either way.

> You can just take the final price, divide by 10, multiply by 2, and round whichever direction you want.

a) this sounds horrendous, and

b) so there's zero pretence that tipping is somehow related to quality of experience?

(I ask as a fairly well-travelled Australian, but who rarely sojourned into North America.)

There's still some correlation to quality. Personally, and I think my friends all do this as well, I have a default rate in mind that I then adjust up or down depending on service. Usually criteria for adjusting up is whether the server has a noteworthy level of service or whether I'm being an unusually needy customer. Adjusting down usually requires something fairly egregious.

That's correct.

Why is that horrendous? (I get "annoying"). It's the restaurant sharing the cost of labor with the diner, which you're doing one way or the other, but tips have less price stickiness than list prices.

There's certainly a "pretense" of tipping as an incentive, and you can treat it that way if you want to (to a point; you can't reasonably tip much below 15%). But you should ignore the pretense; it's not worth the psychic energy.

> Why is that horrendous?

Hmm. Imagine that you never had to consider any kind of unstated, fuzzy mathematical wrangling at restaurants, hairdressers, hotels, in taxis, at stores, etc - your entire life every financial transaction was straightforward.

If you came from that environment, this arrangement would seem horrendous (and annoying).

I understand that there's some cultural exceptionalism involved - there always is - but for most of the (rest of the) world this kind of intentional, onerous, relentless, and needlessly complex obligation is some combination of bewildering, disrespectful, and anathema.

Calculating 10% ain't that hard killer -- just move the decimal point over. 36.22 becomes 3.6. Multiply that by 2, round up/down as you feel is warranted, and go with it. Plenty of the card readers even offer pre-calculated options when paying with debit/credit (usually 15%, 18%, and 20%).

If that's too difficult, horrendous, and annoying to do then chances are you shouldn't be eating out in the first place.

Thanks, but as a metric-loving Australian, you don't need to espouse the benefits of base-10 to me.

My point remains that forcing everyone to consider a tip of varying amounts in a wide range of social / fiscal interactions, is a needless cognitive burden.

Approximately 95% of the planet gets by somewhere between 'just fine' and 'much better' without it.

I've never been to Australia, but my experience traveling in Germany, France and the Netherlands is that service ranges from "adequate" at best to "abysmal," with the average case being much closer to the latter.

In the US, I'd say service is "excellent" more than 95% of the time, and I don't think I can recall a single instance of worse than "adequate" in my life.

I have no idea if tipping sufficiently explains this, but it sure seems at least plausible...

FWIW, my anecdata is different. I've travelled - both short work stints and holidays - in ~30 countries over the space of a few decades.

I don't know if I could confidently pick the worst service experience across that time, but a sit-down dining comedy club in Manhattan (NY, USA) would probably be towards the top of the list.

I tend to be non-demanding, accommodating, and convivial etc, so that may have skewed most of my experiences across Asia and Europe towards the positive end of the spectrum.

There are some other contenders for "worst," but this is the most fun story to tell.

Restaurant in the Netherlands. We walk in, there's a podium and a sign to please wait for the hostess. We wait for several minutes, finally get impatient and walk around the restaurants. Find two young girls chatting away in the back. They notice us, but continue their conversation for another minute, then ask us what we want. We ask to be seated.

No problem, they seat us. Another 5 or so minutes go by, we get up and find the girls again. "Can we have some menus, please?"

It didn't get any better from there :P

Ever since that I avoid all sit down restaurants in that country, full stop. Luckily, I don't mind döner kebab for breakfast lunch and dinner!

Yeah, that would put anyone off.

I've only spent a week in Amsterdam, but I don't recall any negative experiences at all.

When travelling I do tend to eschew touristy areas - other than having to look at specific places / objects, access museums or historic sites, etc - then a quick escape to less tourist-heavy areas.

I'm sure we all do the same in places we live, and therefore know well, but I guess holiday mode puts us in a more sanguine mood.

I hate the idea of tipping. I tip generously. Both of these statements are simultaneously true.

The vast majority of the countries in the world (that I've visited) do not believe in percentage based tipping as we do in North America [1]. A tip either involves rounding up to the nearest unit of currency, or takes the form of a small service fee added to the bill.

In North America, we've arrived at a situation where waitstaff actually prefer a tipped environment (due to high upside potential, especially where alcohol is served) and are also beholden to the tip (due to huge downside potential i.e. laws that mandate a lowered minimum wage for tipped workers).

Getting rid of tipping by instituting a living wage can sometimes result in lower upside, so many workers end up being against a fixed livable wage. The calculation is that stochastic/high upsides (at bars, large groups) is preferable to stable but middling upside (i.e. living wage).

On the other hand, the laws of supply and demand still apply. Without high food prices and corresponding demand at those prices, a restaurant can't sustain an untipped staff. So getting rid of tipping is a gamble and not many restaurants, especially low end ones, are able to swing it. Restaurants that are looking to get rid of tips are banking on the fact that the demand will remain the same at higher sticker prices (which in theory, should be true since the effective prices have not changed -- culturally a 15-20% tip is almost mandatory) but psychologically this often isn't the case -- unless you have a sign at the door that says (no tips required).

It's a little bit like Uber/Lyft. The economics doesn't actually work out, but there's something propping it up. In the restaurant world, it's tipping. Getting rid of it is like getting rid of VC money for gig companies. There's a tightrope you have to walk to balance the books.

[1] https://en.wikipedia.org/wiki/Gratuity

> I hate the idea of tipping. I tip generously. Both of these statements are simultaneously true.

I strongly agree with this. Particularly in the US, where tipped workers are allowed to be paid less than minimum wage on the assumption they will be tipped. So yeah, I’ll tip. But what a damn stupid system.

In addition, the amount a waiter is tipped is also often influenced by their race, sex, and physical appearance.

The thing I don't understand that mandatory fixed service charges (in lieu of tips) are already standard for large groups in many if not most US restaurants, because negotiating tips and who pays what in this situation is even more complex.

Why is it so hard to just extend this existing, well accepted practice to smaller tables?

I think it's cultural. Minnesota is doing it though.

https://www.minnesotamonthly.com/food-drink/new-restaurant-s...

The other issue is US consumers get confused and don't know what to do. The difference between a tip, a surcharge, and a service fee is so subtle that it's a mess to keep up with.

https://laist.com/2019/08/26/restaurant_surcharge_tip_los_an...

I think for this to work, it needs to be established as a new widespread social norm. Otherwise the confusion actually increases the friction of dining out (well pre-covid), and restaurants lose. It takes brave restaurants to risk being a casualty of confusion. A good number of restaurants might need to be sacrificed.

I also hate tipping, and as a result, I just do takeout. No tips expected, no tips given, no problem.

As someone from India, I never understood the the tipping culture when I went abroad. It is not that tips are non-existent in India. It is not mandatory in India. However in UK, any tip < 10-15% is judged and hence the reputation of Indians as poor tippers. This leads to lot of mis-understanding.

I was surprised even getting a simple haircut had to be tipped in UK. I do not mind if the appropriate tip amount is factored in the price itself. The guilty-feeling and ambiguity whether I am being miserly or not made me avoid such places whenever possible.

Note: I learnt later that waiters in an restaurant are not that well paid and they have to "earn" it via tips.

I’m British. I’m sorry you feel this way. It’s the thing I hate the most about visiting the US. I’m going say this once and really big for you:

YOU DO NOT HAVE TO TIP IN THE UK.

You can if you want but, having worked in the service sector, it is not expected, service staff won’t think worse of you and please don’t feel guilty.

Unlike the US we have a vaguely liveable minimum wage that is nearly £10 per hour now and tipping is absolutely not required.

I only tip when the service was excellent or the person actually went above and beyond.

£10/hr sounds significantly lower than what a US server would make in a $$ restaurant (based on industry norms for diner/day/server), let alone a $$$ or a $$$$. If they're relying on that little cash, I'm definitely tipping next time I'm in the UK.

A good salary in the UK is any over £40,000 and not all service workers are paid the minimum. Minimum wage in the UK works out At £15k-20k per year so yeah, not a good salary but a lot better than the $3 an hour I’ve heard US restaurant workers get per hour. If you have to rely on the enforced generosity of customers so your staff can afford to live you don’t have a viable business in my opinion, and that seems to be the model in the US.

If memory serves tipping used to be heavily frowned upon in the US until the Great Depression.

No, servers in the US do not make $3/hr; they're required to make minimum wage and have a starting backstop wage (that's the $3 you hear about), and make as much more than minimum as their tips allow.

Of course, the US minimum wage is much too low to live on in most urban areas, so the minimum wage part is cold comfort. But servers in $$/$$$/$$$$ restaurants make substantially more than minimum wage in tips. By OpenTable's scale, a $$$ is ~$40/customer; a 4-top would be ~$32 in tips, a normal table is turned in 1.5 hours or so, and you serve multiple tables simultaneously. You can work out a rough range of outcomes in your head. Service staff come in an hour or so early and may stay a bit later to close out, and that brings the average down, as does sharing, splitting, or pooling, where that's allowed to happen, but it's still much higher than minimum wage.

Obviously, this applies to higher-end restaurants. But then, higher-end restaurants are where the "no tipping" movement is happening.

Yes I’ve heard this argument before as well and understand that’s why tipping is still pervasive however most restaurants aren’t $$$+ meaning most service workers don’t earn this amount and it still requires customers to pay more at their own “choosing” for the staff to have a liveable income.

I was once chased out of a restaurant in New York and forced to tip 10% after they got both our orders wrong, what they did eventually serve us was cold, the staff were very rude (apparently he couldn’t understand our accent - I’m from the UK south and basically have zero accent) and the toilets hadn’t been cleaned in what looked like forever. Yet apparently I still had to tip or he would called the police. This place was rated as $$$.

Tipping isn't legally required, so this story doesn't make much sense.

Well it doesn’t make the story less true, it just means the waiter lied to two tourists and used the threat of police to get what he wanted. Further evidence that US tipping culture should be abolished.

You thought that tipping was mandatory?

From what I've read, that's not true at all. I'd imagine a whole lot of waiters and waitresses are earning a lot less than you imagine. £10/hour seems more reasonable, but our minimum wage keeps going up and includes holidays, etc. and we do not need to pay health insurance either.

Oh, lots of servers are earning less than that, but in the UK, if there's no tipping norm, and people are generally paid a $14/hr minimum wage instead, then fine dining servers in the US are substantially out-earning those in the UK.

It's worth pointing out that minimum-wage workers in the UK receive various government benefits too, such as help with rent, low rates of taxation etc.

Minimum wage in the UK doesn't provide a lavish lifestyle, but it's more than possible to live on it.

> then fine dining servers in the US are substantially out-earning those in the UK

You keep moving the goalposts. Now fine-dining? People here can tip too, it's just that companies are required to give them a basic standard. At a fine dining restaurant they'd be earning more than minimum wage generally.

Service workers are required to receive a basic standard in the US as well, it’s just that tips are counted towards the minimum wage.

The reason fine dining is interesting is that’s where the no tipping movement is most prevalent in the US. Also note that fine dining serving staff is generally pro the current status quo because they believe they make more money under the current arrangement than they would under the alternative.

Where in the UK is this? I don't think I've ever tipped, although some restaurants do add an optional service charge (if you pay by card, it'll ask when you're paying).

I've never once even considered tipping for a haircut, and I've also never heard of Indian's having a 'poor tipper' reputation :)

I sound grumpy, but I do tip when I feel it's required. Once I went to a restaurant with family, and realised that they had no vegan food (my dad had thought a green 'V' meant vegan), and the chef and waitress went way above in preparing me some off-menu food for me, even though it was quite late in the evening. For me, that was an example of where tipping was required and I've been back many times since.

Since I do not have evidence for what I had experience. Here are some advice on the net:

https://www.independent.co.uk/money/spend-save/tips-on-tippi...

https://www.lhaa.co.uk/blog/how-much-to-tip-a-hairdresser#:~....

Although it is always worded "if-you-want-to" or "if-you-can-afford". I feel this is a bit ambiguous.

Give me the price up front, including cost for the staff to get whatever is determined to be a decent wage. At the same time, pay staff a decent wage.

Ugh, I generally pay 0% tip and these kinds of restaurants just add friction where I have to send the bill back for them to remove it.

Several restaurants have gotten rid of tipping in Seattle, either through just eliminating it or through the "we charge a fixed additional fee that goes to staff". Either way, I'm a fan (though I prefer the former) if the business provides a living wage, benefits, etc.

Good riddance. Tipping is racist/sexist, and is more often than not an excuse for the restaurants to use it for exploitation. I live in Toronto and everyone I know working in the food industry is happy to hear this.

It isn't hard to find servers who do support tipping; especially in high-end and fine dining, it's relatively lucrative.

Racist/sexist in that it allows racists and sexists to express their biases via poor tips? Or something else.

Are tips universally distributed? I would suspect that unconscious bias can impact tipping norms and result in certain classes of people getting smaller or larger tips. I don't have data to back up my hypothesis, however. Additionally, tips tend to go to front of house staff, where certain groups are more/less represented.

That's fair. To be clear, I wasn't denying the claim, just asking for your thoughts around it.

I tip 20% rounded up to the nearest dollar every time, unless I'm really disappointed with the service which is quite rare.

Tipping isn't racist or sexist any more than language is, but you can have sexist or racist tippers.

I won't eat at a restaurant that decides I must pay X% tip. I occasionally get tips at work when I do outstanding service, and it's awesome but not required. I pay tips on the same way.

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