Where the Money Actually Goes

If you would have asked me six months ago, before my work as a hostess at Zen Sushi and Bar began, where I thought my tip money went when I gave tips at restaurants, I would have looked at you like you were a little thick and replied “well, into the pockets of the servers, of course”.

That idea is fanciful, to say it nicely. When I interviewed Craig, who is a server at Diamond Jim’s here in Bellingham, Washington, I asked him how much of his tips he got to keep for himself. He told me that he got to keep sixty percent. Those of you who think like I did six months ago might be astounded, and a bit indignant. You thought that you were tipping the server for the service they provided, so where is the other forty percent going? Now, in the case of Craig and Diamond Jim’s, rest assured that the manager or the boss isn’t pocketing part of the tips. At Diamond Jim’s, the forty percent of Craig’s tips (and the tips of all the other servers that work there) go into a large pool, so that the kitchen staff, the dishwashers and the hostesses can leave with a little extra money in their pockets, too.

Now you are all probably breathing a tiny bit easier, knowing that even though the server doesn’t get to keep all of your tip, the rest of it goes to others who you may not see giving you service, but are working hard to help the server out (as a hostess, I can tell you being a busser, dishwasher or host is no cakewalk either).

Comparatively, the servers of my very own Zen Sushi and Bar are treated a little differently. Katie and Taylor were kind enough to offer some wonderful insight on what it means to be a server at Zen. Comparatively, Craig over there at Diamond Jim’s has got it pretty good.

Katie and Taylor, when I asked them how they split tips at Zen, told me that seven percent of every table’s bill is given to the kitchen staff. You might think that it sounds better than Craig giving up forty percent of his tips for his whole shift to the rest of the staff, but let me break it down. For every single table a server at Zen has during their shift, seven percent of that table’s bill goes to the kitchen. Yes, that’s right, I said seven percent of the bill, not the tip. So if a table tips ten percent, the server only gets to keep three percent of it. If you think that’s bad, let’s say a table doesn’t tip at all. The sever still has to give the kitchen staff seven percent of the bill. So that money comes out of what the server has already made for tips that night. If a table has over $50 worth of food, then they can transfer it to the admin account so they don’t lose too much, but think about it: seven percent of $40 is $2.80 out of a server’s pocket. That can add up quick if there are multiple tables not leaving tips.

Before you lose faith in your fellow man, the servers assured me that the percentage of tables that tip less than ten percent during their busiest time is five to ten percent, depending on the night. So, very rarely would a server lose so much during their shift to bad tables that they don’t come out on top with tips for the night. However, when I casually asked around to my server friends at Zen how much they depend on the tips they make, they all adamantly told me that they desperately rely on their tips to live.

Think that this system is a little messed up? This may seem like a modern day problem, but it’s one that’s been around for centuries. It’s time for a little history lesson.

To start off, I’d like to recommend Steve Dublanica’s book Keep the Change. If you’re interested in this topic (which you probably are since you chose this article out of Medium’s vast selection), this book is for you. All of the information I’m about to give you I’m drawing from his prologue and first chapter. Tipping started in Europe hundreds of years ago, but only made it big in America after the Civil War. The practice started out as a matter of politeness to the servants of others back in the Old World, but became warped when it reached America. Employers of the new lowest class (aka the recently freed slaves) realized that they could get away with paying their employees little to no actual wage because they’d receive tips from customers. This increased the bottom line for the employers but left little money for the families of those exploited employees to live on.

Right now, you’re all probably feeling a little bit slimy, right? After reading this piece of Mr. Dublanica’s book, I was thanking my lucky stars that we were rid of that horrid system. And then I found this statistic.

According to the United States Department of Labor website, of the fifty four U.S. states and territories (including Guam, Puerto Rico, the Virgin Islands and Washington DC), Washington State is one of only eight that require state minimum wage plus tips, while twenty five require federal minimum wage ($7.25/hr) plus tips, and a whopping twenty one only require and hourly wage of $2.13/hr plus tips (if the amount of tips do not equate to at least $7.25/hr then the employer must round it up to $7.25/hr). If this doesn’t make your blood boil a little bit, go back to the beginning of the collection and read it again for more potent results. If you are still apathetic after a second reading, rethink your life choices, because millions of American citizens live on minimum wage, and for them, every cent counts. For many, a weeks’ worth of tips help them, and often times their families, eat for a week.

So, long story short, since the beginning of the popularity of tipping in America, it has been used to exploit the labor of the lower classes, those days freed slaves and these days students, former students and millions of others. So please, next time you go out and eat, think about where the money you tip actually goes when you tip your server.