Tons of small restaurants and fast food establishments are using Square tablets to accept payments. They’re convenient and fast, even automatically emailing you a receipt. But Square snuck something in that has been bugging me for a few years. The compulsory tip.
At the end of every transaction, Square prompts to you tip. And they do it because they know you’ll feel bad if you don’t tip. They’re guilting you into it. Square even admits it:
There’s two types of tipping in America: (1) compulsory tips where the service worker often makes less than minimum wage and relies on tips to recover their full wage, and (2) tips for exceptional service, product, or experience. Both of these tips come after you receive the service.
I don’t recall Starbucks ever asking for a tip, since they pay their employees well and don’t rely on tips. Yet coffee shops using Square get tipped exceptionally high (again, directly from Square):
It’s the norm to tip pretty high for coffee. Most people in the country tip 19 to 20 percent at coffee shops that use Square.
It is not the norm to tip for coffee! It is a $3 transaction!
When you dine at a fine restaurant, you expect to tip somewhere between 10% and 20+% ranging from the worst service ever to wow that was amazing! You tip at the end, after you’ve received the service. This is true in other service industries, like salons or taxis.
Conversely, you don’t tip when you’re ordering takeout or fast food. When’s the last time you tipped at McDonalds or In-N-Out Burger? Or tipped an Uber driver? Should you?
With the rise of Square, small businesses like food trucks and small dine-in/takeout restaurants ask you to tip. But the model is all wrong. You’re asked to tip in advance of receiving service, and if someone spits in your food, if you throw up violently, or if they insult you, they’ve already got your tip money.
It’s working too. Tips have risen 35–100%, over $144 million more per year. Merchants can configure tip amounts, and even set default tip options for low volume transactions — like $1 for a $3 coffee, a 33% tip.
As a bit of history, a tip is literally a bribe “to insure promptitude.” Tipping originated in 17th century England to compel the bartender to serve your drink quicker. Americans brought it over after the Civil War to emulate the upper class in Europe. In the 1890’s, there was a revolt against tipping because people felt it perpetuated class boundaries between rich and poor. Thus, tipping was done in advance of service because it was the only way you’d get good service. The same happens today at a crowded bar when you tip high on your first drink so the bartender pays more attention to you.
What really annoys me about Square’s system is guilting you to tip before you receive service. It feels sleazy and underhanded, like someone is trying to psychologically rip me off. If the experience was amazing, I’ll drop a dollar or two in the tip jar. The old fashioned way.
Most other countries factor living wage, taxes, and “tips” into the posted price. You don’t guess how much tax will be added on top. You’re not doing mental gymnastics to compute what you should tip. You just pay the listed price and move on with your day. The way it should be.