Tips are out of control. More people depend on them. And more people are demanding them.
Don’t believe me? Consider what happened to Ted Hochstadt, who visited a Starbucks recently. After he paid for his coffee, the cashier momentarily pondered a quarter she owed him in change.
The employee then, “put it in the tip jar without even asking me whether it was OK,” he says.
“It was such an act of chutzpah that it left me speechless,” he says.
“I, not only, never patronized that Starbucks again,” he adds, “I usually go to any coffee shop but Starbucks these days.”
What is going on here?
Well, I’ll tell you what’s going on. The billion-dollar tipping economy is out of control. It’s an economy fueled by greedy business owners who pay their employees below the minimum wage and force their customers to subsidize a living wage for their workers. And it’s getting worse.
Funny thing, I thought Starbucks was different. At least that’s what it claims:
Starbucks is rooted in the notion that the best way to ensure our success is to take care of our people.
In fact, since the earliest days of the company, we offered stock options and health care to eligible part-time workers — a commitment which continues to this day and that most other retailers don’t offer.
In addition to these important benefits, Starbucks partners (how we refer to our employees) receive a comprehensive compensation package that includes a competitive wage, eligibility for merit increases every six months, tuition reimbursement, free coffee and a 30 percent in-store discount on beverages, food and merchandise.
Our partners have, and always will be, at the heart of everything we do. More than four decades in business, we continue our commitment to be at the forefront of doing all that we can to invest in our people.
So why would a Starbucks “partner” (their word) assume Hochstadt would want to tip a quarter? This could have simply been a misunderstanding, and to be fair, I haven’t asked Hochstadt where this took place nor solicited a comment from Starbucks. What would it say, anyway? We don’t condone automatic tipping? We didn’t do it?
But if it’s true, and if this is a pattern, then Starbucks is hardly an innovator. Cruise lines have for a long time assumed that you mean to tip and added gratuities “for your convenience.”
Take Oceania Cruises, for example. Here’s the way it weasels its way around the automatic tipping practice:
How much you choose to tip is a personal matter and completely at your discretion.
For your convenience the following gratuities are automatically added to your shipboard account.
For guests occupying staterooms, gratuities of $16.00 per guest, per day will be added. For guests occupying Penthouse, Oceania, Vista or Owner’s Suites where Butler Service is provided, gratuities of $23.00 per guest, per day will be added.
In addition, an 18% service gratuity is automatically added to all beverage purchases, spa services and dinner at La Reserve.
Naturally, guests may adjust gratuities while onboard the vessel at their sole discretion.
Naturally. That assumes guests remember to “adjust” them on their way to the airport. But Oceania, and you, know better. Who has the time? Walk off the ship and be done with it.
That’s not the worst part. The employees who worked so hard to keep you happy on your cruise may only receive a fraction of your “auto” tip, say insiders. I’ve heard from folks inside the industry that the distribution is anything but fair, and cruise line employees don’t exactly have a lot of leverage. But that’s a story for another day.
So really, having a barista toss a quarter in the jar is just a symptom of a bigger illness in corporate America. Here’s a company that prides itself on being fair, and employees are still crying foul. If it’s happening there, imagine what’s going on behind the scenes at other service industry businesses where morale is lower?
The tipping economy is wrong and must be destroyed. It’s time to get started now.