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Life in America: How Does Tipping Work in America?

October 08, 2012 :: Admissionado Team

Tipping—money paid voluntarily beyond the cost of a service rendered—is a fact of life in America. Understanding some of the basic rules governing the practice will ease your transition to life in the USA.

First rule of thumb: Unlike in other cultures or customs, chances are you will NOT offend someone by offering a tip…as long as you do it discreetly. Flashy tipping is SO not stylish. There are a few exceptions to the rule of tipping liberally: Never tip public officials. It’s illegal for government workers to accept tips, and even an innocent gesture of thanks might be taken the wrong way (i.e., as a bribe—very not ok!).

Within these parameters, you’ll generally be expected to tip for three main categories of service including, but not limited to: food services, travel, and personal services (hairdressers, shoe shiners, etc.). In general, tips are NOT included in your final bill. There are exceptions, but they’re usually made clear to the customer—for example, restaurants may add a gratuity (another word for tip) to a bill for large parties. If in doubt, just ask.

Let’s start with food and drink. Under US federal law, the minimum wage—set by each state, but on average about $8 an hour—does not apply to so-called “tipped employees.” Federal minimum wage for these employees is a measly $2.13 an hour. Pretty low. In other words, customer tips make up the bulk of these workers’ salaries.

But how much should you tip, you wonder? When dining at a restaurant, you’ll generally want to tip 15-20% of the total bill. The better the service, the more you tip. If service is really terrible, you’ll send a clear message with a 10% tip. (A note: There’s some debate on whether to calculate the tip on the pre-tax or post-tax amount of the bill, or whether to subtract the cost of alcohol from the total. It’s up to you.) If you’re terrible with math, you can use the following formula: Double the tax you see on the bill–most states charge 8% tax–and then throw in a little more.

As a student, you might be getting a lot of “fast food,” take-out (also known as carryout service), or food delivery (a service primarily offered by pizza and Chinese restaurants). Generally, you should tip about 10% to your delivery person, but at least $2. Many of the delivery drivers are fellow college students and many employers don’t pay for the cost of gasoline, so tips are particularly important for them. There’s no need to tip for take-out, unless you received special treatment, are naturally generous, or feel guilted into it by a prominently displayed tip jar.

Which brings us to coffee shops and tip jars. You can go ahead and throw some coins into the tip jar, but don’t feel obligated to. Baristas – the coffee makers and servers – are not categorized as “tipped employees,” so they’re making at least minimum wage. You should always tip at bars, on the other hand. $1 per drink is the norm, or 15% of the total bill.

You’ll also always want to tip your taxi driver a dollar or two, or 15% of the total if it’s a longer ride. (Cities with credit-card enabled cabs often have suggested tips based on the amount due.) Same goes for folks carrying your bags, shining your shoes, painting your nails… this list goes on and on. Here’s a great resource with suggestions for every occasion.

Keep in mind that tipping practice may from region to region, and especially in big cities. Check out this nifty clickable map on tipping norms from across the US.

A final thought on tipping: When in doubt, tip. It’s good karma.