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Comment by patio11 | Hacker News Reader

I think you might be overestimating how much insight the waitress has into the business. It may be the case that this was a close, family-held restaurant and they have a daily pow-wow on cost of goods and marketing strategy, but I wouldn't bet that way. My guess? Groupon customers are poor tippers, either from adverse selection or because they either a) attempt to tip with leftover funny-money or b) tip based on the amount they paid rather than the face value. Thus, mentioning you to other waitstaff: they're complaining about prospective tips. ("Gah, I drew another Groupon while you get a good table.")

Put it this way: if you had put twenty quid in her hand when you sat down she would probably have instantly become the most devoted Groupon fan in the world.

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I took the same Groupon deal with a similar outcome (although we stated from the outset we had a voucher so no awkwardness about stuff we'd have to pay extra for). That said:

* This is in London, which doesn't have the same "tipping culture" as the US. Sure hospitality jobs don't pay great, but both my wife and I have worked them in the UK and you can definitely get by without tips. Getting snippy about a drop in tips is nowhere near as justified here.

* We each bought a cocktail before ordering (£8 each x 6)

* As is becoming the norm in London, "optional 12.5% service charge" (good luck ever opting out of it though) was a separate line item on our receipt and it was calculated off of the face value.

* I specifically checked the terms of the offer and the menu options prior to buying the voucher. Despite choose from "the tapas menu" you actually get to choose from "the Groupon version of the tapas menu". The latter being about half the size.

* I left an extra tip at the end mainly because I know the economics for the merchant on running Groupon deals. In hindsight neither the service not the "special" treatment you get as a Groupon customer warranted it.

Because of their attitude I won't be back, that's the cost for making an assumption about me as a customer. I'm still undecided whether I'll use Groupon again though. Maybe seeing this insight into this restaurant was a good thing?

Because of their attitude I won't be back, that's the cost for making an assumption about me as a customer.

That's the rub, really. I find it hard to blame Groupon themselves for stuff like this (though certainly Groupon has other aspects that are complaint-worthy). If you're going to treat customers poorly because they've taken advantage of a deal, I don't really want to be your customer. And if it's such a bad deal for you, as the restaurant, why are you participating anyway? If you really feel that the extra customer acquisition is worth the lower revenue for the sale, then you should be happy when Groupon customers come in. If you don't believe it's worth it, why do a Groupon deal at all?

The people who determine whether to do a Groupon most of the time are not the waiters and service ppl who have to put up with horrible tips.

True, but the waiters and staff are the public face of your restaurant. The owner/manager doesn't get involved in every meal they serve. If you suspect your staff will get cranky with Groupon customers, you need to fix that. I don't care if that means firing the worst offenders and making it clear that you won't tolerate such behavior, or if it means ahead of time declaring that you're going to "fix up" bad tippers behind the scenes by supplementing with the restaurant's cash. It really doesn't matter to me how they resolve the situation, but the owner of the restaurant is responsible for giving his/her customers the best experience possible.

Here's the thing that rubs consumers the wrong way: "the Groupon version of the tapas menu."

IMO, if a business is doing this and trying to cut costs then don't be surprised if that person does NOT convert into a regular customer. It's penny wise pound foolish.

It's obvious that people are smart enough to spot that their servings are smaller and their choices are limited compared to normal people. That angers customers! It's as bad as microwaving your food and thinking people are clueless and can't tell microwaved food from fresh food.

Sure, maybe you're saving a little here and there but you're almost guaranteeing that that person won't come back.

My experience as a several-time Groupon user: I've found that restaurant Groupons tend to get you lousy service from cranky staff. Other businesses tend to be better.

I know one hamburger restaurant chain here in Seattle, the Counter, that is now on the second round of Groupon, and this round they offered two coupons per customer -- so my thought is the first round couldn't have went too poorly.

I went in with a Groupon and the experience was first class. Great service. They actually had one guy whose main job was to scan the Groupons. I asked him how things were businesswise with Groupon and he said really busy, but he said now that they can just scan them in, pretty easy (last round they had to look up each coupon by hand).

I of course tipped on the full amount, plus some, because the service was excellent. I liked my meal, and the wife and kids did too. We'll be back. And this is a place I may not have gone to w/o Groupon, although I had heard positive things from neighbors. But Groupon definitely got us the last mile through the door.

My feeling is that now, as a business owner that can use Google, if you don't know what you're getting into, you probably won't be business long with or w/o Groupon.

So at the end of the day, it's not a Groupon promotion that will draw you back, but the great service...

Groupon got me in the door. But the great service and good food will make me a regular customer.

he went there because Groupon. then came the chance of drawing him back.

Groupon customers are definitely poor tippers. I've known a number of waiters to complain about it.

The problem is they tip on the Groupon price, not the full price, and are thus tipping something like 40% of what they should be.

Groupon coupons even have a note to prevent poor tipping:

"*Remember: Groupon customers tip on the full␣ amount of the pre-discounted bill (and tip␣ generously). That's why we are the coolest␣ customers out there."

In the few groupons I've used, I've tipped more than my normal 20% on the full price because I know I've saved money. Except for the one time when I encountered a waitress that acted like groupons were a hassle. It makes me think that poor tipping is exacerbated by a feedback loop: Waiters give worse service or are less enthusiastic to groupon holders, which leads the groupon holders to tip less thereby reinforcing the waiters' impression.

The problem is they tip on the Groupon price, not the full price, and are thus tipping something like 40% of what they should be.

I am not intimately familiar with the tipping culture (at least in the US), but here are some genuine questions: Is there an inherent reason you tip on the full price? Is it a tax? If tipping is to support staff wages does that mean waiters who serve fancier higher priced food items are entitled to larger wages solely for the fact that their table happened to order a costlier meal?

IAmerican tipping culture: there is a near-involiate presumption that wait staff gets tipped N% of the order. Customary practice recently is N is 20. Theoretically, tips are tied to service received. In practice, variation from societal norms is vanishingly rare in polite company.

Waiters in higher priced restaurants do make better tips as a consequence of this. That might matter if the culture were designed. It was not, it merely came to be.

FYI, apart from suffering social opprobrium, the big reason to always tip is that wait staff are taxed on your imputed tip whether you give it or not. This leads to compelling social justice reasons to tip even if one does not share the culture.

Side note - in California 18.5% is the customary practice for tips, though, to make it easy, you can round up to 20%. No service person will complain. If you get lackluster service, you can point it out with a 15% tip. Poor service gets a 10% tip, and, will make it clear you are unhappy.

After 15 years of doing this (I'm from Canada, where tips aren't as proscribed, though they are still expected) I find it awkward and socially painful to pay the bill in countries in which there is not a tip expected (certain parts of Australia) - even though the locals assure me that no one will think the less of me.

I find etiquette fascinating, so I've read some books on it. Particularly, in tipping etiquette, prescriptive books seem to agree about one thing:

In the US, if you're going to tip less than 15%, you should not tip at all. You should leave nothing and ask to speak with a manager to explain why you won't. If the failure in service doesn't rise to that level, then 15% is the minimum polite tip.

Of course, it's your wallet so do what you think is best. But this seems like a reasonable practice, so I follow it. I've actually never had to speak to a manager about service at a restaurant, though.

The books are not correct as far as practice goes. 10% was standard for years and 15% for great service. Waiters of course have been trying to promote 20%, 22.5% and more as normal.

10% is not great, but is what senior citizens and rich politicians will leave if they tip at all.

10% is considered an insult in California, and will be treated as such.

I accidentally left a 10% tip at Fisherman's Wharf (Early on in my california experience), and was approached by the Maitre D as I was departing, asking what was wrong.

If you can't afford to tip, best just not to eat there in the first place.

I've also noticed that many lower-end restaurants will print pre-computed tip values at the bottom of the sales receipt for 15%, 18%, and 20% (both as a prompt and as a "nice" thing to do so you don't have to do the math yourself). But these values seem to always be calculated off the post-tax cost of the meal, whereas convention seems to be that you tip based on the pre-tax subtotal.

10% has not been standard in the US for quite some time. You need to update your info.

18.5%? I live here in CA and have always done 15 but feel recently being forced into 20... but I could never calculate 18.5% in my head =)

I like to keep it simple. 20% or 25% for fair to good or really great, 15% for poor service. I too don't like how people are trying to push this value up. But at the same time I have enough and I don't mind sharing some with a person who has just served me dinner.

You can do it pretty easily by successive halving. 10%, just move the decimal over add 5% which is just half of 10% add 2.5%, which is half of 5% and add 1%, moving the decimal over twice

...of course you either naturally think that way or it seems like an unreasonable amount of work. YMMV.

Personally, I usually take 15% and add a bit depending on how good the service was.

A lot of the "classier" restaurants in my Canadian city, include a minimum 15% tip on the bill which is an interesting approach--Though it ravages the the funny after-meal banter I have when dining with my grandparents. "15% ARE THEY MAD?!!" Haha.

I'm in Canada, where tipping is just as expected as it is in the US. However, here it seems that 15% is standard for good service; 10% for fair service or a buffet/brunch meal (where the server was less-involved); and 20% or more for fantastic service. I had no idea California was so high.

Servers in all proper US/Canadian restaurants have to "tip out", which means paying a percentage of what should have been their tip on any table to support staff (e.g., bartender, host, kitchen). A server can tip out as much as 5% of the pre-tax bill --- or 1/3 of the expected standard tip --- which means that if you leave them no tip, they actually have to pay to serve you.

Also, often the IRS taxes them not on what they actually make in tips if it is low, but on what the IRS thinks they should have made.

Interesting; in the US it's common practice for all tips received to be pooled, and then divided among the waitstaff, busboys, etc. I'm not sure if they're divided equally, but everyone should at least get a pre-decided portion.

this is something that probably isn't clear to people who don't live in the US -- wait staff in the US make around $2-3/hour. they aren't paid a living wage. they rely on tips as their primary source of income, and tips are usually shared with a bartender/busboy.

if a restaurant runs a groupon and all grouponers tip on the post-coupon rate, the wait staff will be taking a rather large pay cut for the length of time that people are grouponing. i know i'd be grumbling if something my company did resulted in me making 50% less for a month or two.

more expensive restaurants and meals mean more expensive tips because the wait staff is more experienced, better trained, higher quality, and do more work. one person at a higher-end restaurant can give high quality service to fewer people than one person at a low-end place, and meals at a higher-end place usually take much longer. yes, the average tip is larger, but the frequency in which they receive tips is lower. yes, they make more, but not that much more.

wait staff in the US make around $2-3/hour. they aren't paid a living wage.

The rules for the U.S. vary from state to state. In Oregon, where I live, wait staff make minimum wage ($8.50 per hour) and tips are added on top of that.

All restaurants are required by law to pay at least minimum wage if the employee doesn't make at least said wage in tips.

How this works in practice is servers are fired if they do not sign off that they earned the difference in tips. This is a big issue with fast food restaurants like Pizza Hut, and cheap buffets where there is a lunch rush and then a slow period, coupled with a propensity of patrons of this sort of place not to tip because they think it is a buffet or fast food restaurant, not one where servers are paid $2.35. Often you have slow periods where there might not be any customers. Let's say from 1-5pm at Pizza Hut you have 3 tables and each leaves $1. So you made $3 in a 4 hr part time shift. You get paid $2.35 * 4 = $9.40 for those three hours. If minimum wage in your state is $8.25, you are required to report that you made $23.60 in tips during that period, not $3. You then pay various taxes on those phantom wages, notably social security and medicare tax, which are regressive flat taxes. You also may find yourself being forced to split the phantom wages with the dishwasher and manager. Often you make less than $0 during your shift. Some people can make up the difference during the dinner and lunch shifts, but those usually go to senior employees and the more attractive women. Getting more than 4-6 hrs a day is hard because then you are no longer a part time employee, which means the employer might have to start paying benefits, which would ruin their entire business model that relies on $2.35/hr wages and no benefit costs. Talk to anyone who works at Pizza Hut or most buffet chains to hear more about this in great detail, I have heard about this situation from dozens of people over the last 30 years.

I'm sorry you've had that experience. I've worked as a waiter, and was never pressured to report anything other than what I made. I'm not advocating for poor tipping, I was just clarifying for those not in the US how the law is written.

The experience is frighteningly common. More common to be forced to lie, than it is to not, in my experience.

Waiters and waitresses typically make more than minimum wage, once tips are taken into account. A cut in tips due to Groupons yields an effective cut in salary. Minimum wage is just the floor.

this is true, but sometimes people bend or break this rule (most people don't, of course).

Actually this varies by state. In California, the minimum wage law applies with or without tips.

wait staff in the US make around $2-3/hour. they aren't paid a living wage.

Not true. That's why we have federal minimum wage laws. If the wait staff are actually employed and not acting as independent contractors, then they are paid the minimum wage for their state. (Although I will grant that this being a living wage is definitely arguable.)

Edit: Correction - although not California (my state), apparently some states do allow minimum wages in the $2-3 range if employees receive tips [1]. For the downvoters, I only count about 5 states that do this, however. The original statement does not accurately reflect the majority of the U.S.

[1] http://en.wikipedia.org/wiki/List_of_U.S._minimum_wages

Not true. Waiters have a different minimum wage:

http://www.dol.gov/wb/faq26.htm

Question: Is it legal for waiters and waitresses to be paid below the minimum wage? Answer: According to the Fair Labor Standards Act, tipped employees are individuals engaged in occupations in which they customarily and regularly receive more than $30 a month in tips. The employer may consider tips as part of wages, but the employer must pay at least $2.13 an hour in direct wages. An employer may credit a portion of a tipped employee's tips against the federal minimum wage of $7.25 per hour effective July 24, 2009. An employer must pay at least $2.13 per hour. However, if an employee's tips combined with the employer's wage of $2.13 per hour do not equal the hourly minimum wage, the employer is required to make up the difference. The employer who elects to use the tip credit provision must inform the employee in advance and must be able to show that the employee receives at least the applicable minimum wage (see above) when direct wages and the tip credit allowance are combined. If an employee's tips combined with the employer's direct wages of at least $2.13 an hour do not equal the minimum hourly wage, the employer must make up the difference. Also, employees must retain all of their tips, except to the extent that they participate in a valid tip pooling or sharing arrangement.

So, although waiting tables is - predictably - not a great job, nearly all waitstaff in the US will be making 7.25/h as you would expect from federal minimum wage? And contrary to what most people attempt to convince me?

Coming from a country with a culture of smaller tips and significantly less social pressure to give them, I usually say that I should not be forced to make up for the employer's false advertising when receiving only mediocre service. This now seems correct - not tipping wi make the employer pay the remainder, not force the waitstaff on to the streets. Right?

Nearly all waitstaff in the US will be making more than 7.25/h. If "not tipping" suddenly became endemic, I imagine plenty of waitstaff would be forced "onto the streets".

"Tipped workers" are paid under different rules, and it varies state by state. They typically have a minimum cash wage ($2.13 federally and in NY for example) and an hourly "tip credit" ($5.12 fed/in NY) to bring them up to standard "minimum wage" ($7.25). They only get paid $2.13 an hour by their employer.

More here: http://www.paywizard.org/main/Minimumwageandovertime/Minimum...

Actually this is true. Average tips are calculated when determining hourly wage. I worked as a server for 4 years in high school/college. My hourly wage was about $4/hr while the minimum in Florida was $6.25. My paychecks mostly went to paying taxes on my tips.

yes, you're right, what i said wasn't fully true for expediency's sake, but your statement isn't fully true either. federal minimum wage laws don't apply to tipped workers in the same way (iirc, it varies based on the state, i'm not sure).

if an employee doesn't at least make minimum wage after tips are considered, an employer is required by law to compensate an employee up to the point where they do make minimum wage. in theory.

in practice, this doesn't always happen.

Yes, I added a correction.

Is there an inherent reason you tip on the full price?

Yes, theoretically the higher your bill the better time you are having. (Think celebratory events as opposed to a lunch break.)

Is it a tax?

No, it's gratuity. You're showing your appreciation for the staff enabling you to have the best experience possible at that time (in theory).

If tipping is to support staff wages does that mean waiters who serve fancier higher priced food items are entitled to larger wages solely for the fact that their table happened to order a costlier meal?

Serving higher priced food usually means higher caliber of customers, in the tipping sense. For example, patrons of Denny's restaurants might tip well if the coffee refills are on time, but in a finer dining establishment, for example, service requests for something off the menu (like a newspaper) would not be out of the ordinary.

Right, we pay our waitstaff next to nothing in terms of hourly rate (it's well below minimum wage) and they make all of their money on tips. If a bill is $50 worth of food, you should tip the waiter on that, even if you got it with a Groupon that cost $25.

Waiters at higher-priced restaurants do make considerably more. Thus those restaurants are far more selective (a lot of waiters at, say, Fridays are new to the trade, not so at Mortons) and the waiters are better. Their jobs are more time-consuming too since there are more courses, wines, they're expected to be more knowledgeable about the ever changing menu, etc.

This doesn't address your question about culture, but the one time I used Groupon the sheet we printed out with the coupon on it specifically asked that we tip on the full price.

Sounds like a pretty sensible practice.

Yes, it's a tax thing. A lot of restaurants base your taxes on your gross sales, assuming you will get 10-15% in tips. Coupon deductions are not calculated in this gross.

Generally speaking more expensive restaurants have better trained and more experienced servers that are more attentive hence deserving in a better tip. The percentage is really just a hack as a rough estimate of how much work a server had to do. While not always true a meal costing $100 will probably require more work from a server then a meal costing $50.

The company is offering the coupon, not the waitress/waiter. It'd be like every time the company you work for offers a discount to a customer, you see money taken out of your hourly wage or salary. Personally that would make me livid.

I always tip on the full price of the meal.

In the US, wait staff at restaurants are paid $2.35/hr, same as the minimum wage in 1975. Each time since then that the minimum wage has been raised, there has been an exception for agricultural labor (field workers can be paid $10 for a 12 hr day if you like and often are) and for restaurant workers.

For high end restaurants it's not so bad since you can make a living on tips. Also, it doesn't apply to fast food workers who don't get tips. However, some especially seedy fast food restaurants like Pizza Hut will have the staff bring out the food, meaning they are exempt from minimum wage. The problem is most Pizza Hut bills are small and half the customers don't realize they are supposed to tip since they think of it as fast food.

In addition to this, most restaurants have no benefit programs or insurance at all. In addition, as is customary in the US, in most cases if you are injured at work, a story will be constructed and you'll be fired.

I tip because that's how my society operates. I tip well^ because it means I get above-par service.

^well is relative to what they expect, so this is where the quality of the restaurant is factored in by myself.

Do you tip before the meal then, or is this based on being a repeat customer?

Repeat customer.

I generally only eat at small family owned joints anyway, so that helps as well.

Also places that have more expensive food tend to have more people to spread the tips around on. The waiter splits the tip with the person busing tables, the person refilling your water glass, the host etc.

Groupon does instruct customers to tip on the full price. It's probably part of the picture they draw when they're pitching to businesses — so when people skimp on the tip, it's a rude awakening.

That's a good point to consider - it must be hard for a waitress / waiter to swallow that their evening will take a pay cut because their boss has decided to get into social advertising.

She/he shouldn't have to. Groupon customers should be tipping on what the full amount would've been without the Groupon.

The onus could just as fairly be applied to Groupon itself as to its customers; shouldn't Groupon be helping the restaurants it does business with, by encouraging/reminding customers to tip servers fairly, and not harm the staff of its business partners?

They encourage that prominently in several places, including this message on the actually coupon voucher:

"*Remember: Groupon customers tip on the full amount of the pre-discounted bill (and tip generously). That's why we are the coolest customers out there."

I've got no lost love for GroupOn, but this massive pile on/proof by anecdote thing is not a dignified moment for HN.

Agreed she/he shouldn't have to but from one everyone is saying it sounds like that is the reality.

That really surprises me. So disappointing. I've always been taught to tip on the full cost, even if I'm getting a deal. This isn't new because of Groupon; gift certifcates/cards and vouchers have certainly been around forever, though perhaps not as prevalent or well-publicized.

In defense for consumers, normally tip should be calculated off of the pre-tax subtotal. Most restaurants calculate tip (say if you're in a group of 6 or larger so it becomes compulsory) based on the post-tax total. So tip, as it is, isn't always accurate.

I think you're spot on that Groupon customers are poor tippers. This was in the UK though where the tipping culture isn't so common place.

Yeah, it's already common to not tip anyway. Sometimes I tip, sometimes I don't (though when I do, I'm more generous than the standard 10%).

FYI: 10% isn't standard: 15% is standard, 20% is good, and 25% or more is for great service.

Those are the norms in the United States, which has a tipping culture that is more or less unique compared to other countries.

In the UK, 10% is standard and entirely optional. 15-20+ is if you're feeling super generous.

Yes, although it's also common in the UK for restaurants of any level to add 10% to the bill for larger groups of perhaps 6+ or 8+ people in a way that is clearly not meant to be optional.

I never quite understand people who always pay 10% for service here, though. If I have received good service, I will tip perhaps 15% or more, partly to reward the good work financially and partly simply because it shows that I appreciated their efforts and encourages similar behaviour in future. Likewise, I will drop a tip to 5% or even not leave anything at all if service has been poor. In a happy coincidence, this means I tend to be regarded as a good tipper in the kind of place I want to go back to, and a poor tipper only where it doesn't matter. :-)

I also only ever tip in cash, directly into the hands of the waiting staff I've been served by. What they choose to do with it after that is up to them, but you'll never catch me adding some arbitrary amount of "service" onto a bill that's going to be paid on a card machine and go straight into the hands of the management.

That's standard in the USA. In the UK it is not standard, however 4 weeks minimum paid vacation (and about 8 days paid public holidays) are standard. Different countries.

(in the US, not Europe)

This is why I despise using coupons (or gift cards, for that matter) in restaurants in general. Coupons, like it or not, have a distinct stigma associated with them that never nets you a pleasant restaurant experience.

More than anything else, I think the OP is complaining about restauranting with a coupon/gift card rather than utilizing Groupon, specifically. That said, he's correct that the model is broken for this very reason.

also, it sounds like the company is (understandably) restricting what is available to try reduce the losses implicit in the deal. that means hassle for the waiting staff, who need to explain the restrictions. i imagine, for example, that in this case the waitress had previously had problems with a similar group who ordered the "wrong" wine and then were vocally unhappy. when they found out.

Yeah good point. She did explain it to us and point out the wording of the deal as though she expected us to argue.

Groupon customers are poor tippers

And that stinks. I was a fine dining waiter at one point in my life and lived on tips. Because of that I always tip on the full value of the meal regardless if I have a gift card or coupon.

I agree with the tipping problem, I myself try to tip based on the total value and not what I pay (because that may be just for a few drinks). I don't want the waiters to suffer for the business owners discounts :)

Here in Czech republic we have local variants of Groupon and in some restaurants people reported the despise from waiters too. Surprisingly, this did not happen when we went to one that was otherwise really expensive - the people there were very nice and friendly. We won't return there regularly because it's out of our price range but for special occasions I would like to go back.

Regarding the quality - from my experience it's about 50/50, some restaurants are bad, some are ok so maybe contactdick was unlucky in encountering the wors first.

It's good to hear you'll go back to the nice restaurant. For some reason I can't get over the mindset that if I return I'm no longer getting the discount so it's way too expensive.

If you can put twenty quid in her hand, then you wouldn't be bothering using Groupon, would you?

Even people who have money will take a deal if it's offered. That's often how they wound up having money.

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