Canada’s Tipping Culture Is Flawed And There Doesn’t Seem A Clear Solution: Experts IG News

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From oil changes to take-out meals, “tip nudges” have quickly become a “well-established social norm” in Canada, according to food economist Mike Von Masso.

Card payment machines have made it easier for businesses to indicate a gratuity option, even in industries where previously tipping was not a cost or part of the negotiation. And data from Canadian trade associations shows that the average percentage tip for restaurant eaters has increased since the pandemic began.

Von Masso, who is also a professor at the University of Guelph, says that Canadians increase in the amount of their gratuity is spiraling out of control, and has become a hot-button issue across the country.

“I went to my local craft brewery the other day, just to the bottle shop, to pick up a few cans of my favorite,” von Masso said. “While I was paying there, someone literally grabbed a beer from the fridge and handed it to me and I was prompted to tip in that circumstance.”

He calls this a “double whammy” for consumers, with more businesses simultaneously raising their prices and soliciting suggestions.

“You know, I’m starting to wonder if I lecture particularly well, should I put a jar in the front of the lecture hall, and file as they go? Maybe they can leave some bills in there. Me too. I mean, where does it stop?”

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Kate Malcolm moved from the UK to Port Perry, Ont., in 2017 where tipping is not common.

Five years later she says she’s still having a hard time getting to grips with Canada’s tip culture.

“There’s no way that in England you’d give $10, $20, $30 to a barber,” she said. “It’s so expensive to get your hair done as it is, and then you have to tip them too? It’s such a foreign concept.”

Malcolm, who runs a podcast aimed at newcomers, covered her reaction to Canada’s unwritten rules of gratuity in one. tiktok videos Outline of her “culture shock”.

Kate Malcolm is shown in a screenshot of a TikTok video which she has shared in Canada outlining her culture shock since coming to Canada 5 years from the UK.  In this shot it is exposing Canada's tipping culture.
A screenshot of Kate Malcolm in a TikTok video that includes her reaction to Canada’s unwritten rules for gratuity. (Kate Malcolm/TikTok)

She says when her parents first came to visit they weren’t even clear what the expectations were for tipping in Canada, leading to an awkward exchange at a restaurant.

“They just threw coins on the table, like maybe $2 and turned, and were like, ‘That’s all we do, right?’ I was crying for him. I’m like, maybe it’s more insulting than not doing [tipping],

Malcolm also lived and worked as a server in Australia, where tipping is also not the norm.

She said the pay was much higher than in Canada, and that she felt less pressure to be “super friendly” all the time, without being expected to make a suggestion.

Some customers are annoyed by the tip prompt

Dough Bakeshop in Toronto added a gratuity option to its card machines after input from employees and customers.

Co-owner Onagh Butterfield says they always have a cash tip jar on the counter, but sees a significant increase in tips when customers are given the option of a debit or credit card to do so.

“I’ve signed up since implementing this, as clear as it can be, saying it’s not expected,” she said.

Headshot of Onagh Butterfield, co-owner of Flour Bakeshop in Toronto, Ont.
Onagh Butterfield, co-owner of Dough Bakeshop in Toronto, says some customers have expressed displeasure about being prompted for a tip even with signs posted in the store that say tips are not expected. (Photo by Dylan Garage)

Despite posting signage like “Please press green to bypass the tip option,” Butterfield says some customers still question the electronic gratuity option.

“Sometimes, I would say, there’s resentment at the fact that he’s even being asked the question, ‘Would you like to tip?’ Especially if they’re just buying bread, so I try to communicate with people again, it’s not a necessity.”

Despite currently having tip options for customers, Butterfield says she supports moving away from Canada’s current tipping culture, “so that everyone is guaranteed a living wage.”

No tipping equals the prices raised to pay employees a living wage

In July 2020, Toronto’s Richmond Station restaurant did away with tipping, instead raising its prices to pay employees more.

Co-owner Carl Heinrich calls Canada’s tipping culture “a very unequal way to pay employees.”

He says the lockdown forced his business to start offering take-out – historically a service that didn’t generate a lot of tips, he says.

“Whenever you edit someone’s salary or salary, their livelihood, a lot of communication is necessary,” Heinrich said. “Since there was no blueprint for this new system, there was a lot of work. And to be honest, two years later, it’s still working.”

A headshot of Carl Heinrich, co-owner of Richmond Station restaurant in Toronto, Ont.
Carl Heinrich is the co-owner of Richmond Station Restaurant in Toronto. He says he ended tipping in July 2020. Instead, they opted to raise their prices to pay employees more. (Photo by Sarah Brownlee)

There is no uniform rate of living wage for Richmond station employees. He said the salary varies based on an individual’s performance, experience and their position.

“Dishwashers are making a living wage. Servers are making a living wage. But of course our best servers are paid more than our least experienced servers. This was not possible in the previous system.”

In an ideal world, there would be no tipping. This is the destruction of human rights. But that’s just so deep penetration. I think we’re stuck with it.–Mark Mentor, Business Professor, University of Saskatchewan

Aside from “very top-end” restaurants, where customers may not be sensitive about how much they’re spending, many businesses replace tipping with service fees, says University of Saskatchewan business professor Mark Mentor. are not successful.

Customers love the illusion of having authority over servers and servers, they like the illusion of controlling the amount of their income, he adds.

“In a perfect world, there would be no tipping. It’s a human rights catastrophe. But it’s just so deeply grounded. I think we’re stuck with it.”

Mark Mentor pictured sitting at a table with a drink next to him.
Mark Menger is a professor at the Edwards School of Business at the University of Saskatchewan. He says card readers for electronic payments have changed expectations about how much to tip, when to tip and for what. (Submitted by Mark Menger)

The hefty pre-programmed tip percentage options on chip card machines “can scare people into tipping a higher percentage than before,” Mentor said.

“Everyone complains about tipping, but given a choice between restaurants with no tipping and restaurants with service charges, I’m not sure how customers would make that choice. Customers may really like the tipping approach.”

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