I’m a very thankful person.
So when I go out for dinner or get a haircut and receive good service, I tip.
In fact, I can’t remember a time when I was so offended by a service, I didn’t tip.
In today’s world, tipping has become standard practice in the service industry. And while there are many tools that can help eliminate the stress when trying to figure out the math, such as a tip calculator, the question remains:
How much should you tip?
Tipping in Canada
Tipping culture has certainly permeated North America, but you may be surprised to know that the "tip" (a.k.a gratuity) was born in medieval England. They called it “Vails’ to the Servents” and customers would leave a gratuity at ye ol’ tavern in order to receive better service.
Today, tips are a way to show appreciation for a job well done or to set the standard for the kind of service you’d like to receive.
Some customers don’t like tipping, while others do.
For some countries, such as Canada, a tip is an anticipated gesture (and is perhaps the reason some customers don’t like tipping!). In other countries, such as Japan, a gratuity is a complete and total insult.
So what’s the standard for tipping in Canada? Where exactly is the sweet spot between "Hey big spender" and “Thanks a lot Ms. or Mr. Cheapskate!”?
To find out, I enlisted the help of some friends in the hospitality and service industry to educate me on the standards of tipping today.
My method was simple: reach out to honest staff and ask them about the money they make.
The end game? Become a better, more appreciative customer while making sure my wallet isn’t overtaxed with uneducated guesses on tipping.
These findings may rattle some cages, or shake some core beliefs on tipping, but in the end, this post should help you view tipping in a clearer light.
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How Much Do You Tip a Hairdresser?
Whether you’re visiting your local barbershop or getting a blowout from a high-end stylist, one thing is for certain: the more upscale the salon, the more you’ll end up tipping.
While anything from 10% to 15% is expected, there are a few subtle differences that determine how much you’ll spend.
Tipping in a Barbershop
Barbershops are back in style these days, so the price of a good, clean cut is bound to be a bit more than your average hairdressing chain.
Where I live, barbershops seemed to have popped up out of nowhere, undercutting most hair salons while offering something more than your typical mall cut. And they’re even appealing to more women as well!
According to my sources, people will typically tip $3 on a $25 haircut (a little over 10%) and scale it upward or downward depending on the service. Seeing that the average men’s cut takes between 15 and 30 minutes, a barber does OK when it comes to gratuity.
What does the barber like to be tipped? 10%
What is the reality? 10% – but anything is appreciated
Tipping in a Hair Salon
Unlike the simple barbershop, a salon ups the ante when it comes to tips.
Because salons tend to cost more with their wide array of services, such as blowouts, colours, washes, etc., bigger tips are usually expected.
And let’s face it, many hairdressers (and barbers!) do more than just hair. They are also sounding boards ‒ a confidant ‒ listening to all the joys and failures in a client’s life.
It’s important to remember that many hairstylists rent a chair from where they work, so while the price of services are generally influenced by this cost, a tip goes entirely to the hairdresser.
What does the hairdresser like to be tipped? 10 to 15%
What is the reality? Around 15%
How Much Should You Tip in a Restaurant?
How much you tip will depend on the night of the week and the type of restaurant you’re eating at. For high-end restaurants, most people will tip 20% or more on their bill. And as Mondays and Tuesdays are typically slow in the restaurant industry, people generally tip less on these days, anywhere from 10% to 15%.
When it comes to tipping the support staff (cooks, dishwashers, etc.), these earnings are calculated either as a percentage of the wait staffs’ tips or through a tip pool.
In some cases, the wait staff is required to put in roughly 20% of their tips (or 1% of their net sales) into a shared pot that is divided by the support staff.
In a tip pool, all the tips from each server and bartender are pooled into one pot, and then distributed to servers and support staff based on a certain percentage.
Related: Free Coffee Rewards
Tipping Your Server
The biggest tippers are typically other servers as they can appreciate the personal details that go into a nightly service while balancing many customer needs at one time.
But how much you tip will all come down to the service you receive.
Servers don’t expect everything to go smoothly, but they will do their best. A small tip speaks volumes and a good server will take that to heart and step up their game in order to earn a bigger tip next time.
What do servers like to be tipped? Roughly 15%
What is the reality? 8% to 20%
Tipping the Bartender
Tips for a bartender seem to run parallel to that of a server. When it comes to corporate restaurant chains, tipping for bartenders is usually on par with servers and they’ll pretty much make the same on tips per shift.
What do bartenders like to be tipped? 10% to 15%
What is the reality? 5% to 20%
Tipping the Delivery Guy
The tipping realities for a delivery guy are a bit shocking for a number of reasons.
On average, most people will tip $1 to $3 for a hot, fresh pizza to arrive at their door. While 10% is the preferred tip (roughly $3), most people will only tip 3% (roughly $1).
What’s disturbing is that both pizza guys I spoke with, who work for reputable, international pizza chains, made less than minimum wage for their time. One made $5.25 per hour, while the other made 6 bucks an hour. That was minimum wage back in 1992 ‒ this is 2018!
How is this possible? Perhaps neither are on the official company payroll and, to avoid taxes for their low wages, they get paid out at the end of each shift.
But when you consider that a typical night brings in $60 to $80 for an eight-hour shift, factoring in gas and wear-and-tear on a personal vehicle, simply having this job isn’t even worth it. Not even for a 16 year old!
What do delivery guys like to be tipped? $2 to $5, depending on the order size
What is the reality? $0 to $3 (for a two-pizza order)
Tipping On Tax
Most of the service people I spoke with didn’t know whether or not they were being tipped on top of tax (HST, PST, GST). Or rather, whether they were being tipped on top of the total bill of the service or the bill minus taxes.
Many customers think tipping on tax is wasteful. No one would ever buy a home and pay a real estate agent their cut by adding land transfer or any other tax factored in to their commission.
So why do it for the service industry? (Sure, the stakes are much smaller, but it really adds up!)
Tipping from the bill without taxes ensures you’re not tipping on money that doesn’t go to the business or the person serving you.
And let’s face it, not everyone is a whiz at math, nor do they want to pull out their cell phone and calculate the percentage for a tip when it’s time to pay.
So one thing to keep in mind when tipping is that most bills have taxes broken down on it.
For example, a $25 base service will result in a 15% tax of $3.75, creating a grand bill total of $28.75. Adding another $3.75 for gratuity is a generous 15%.
So, good practice is to use that tax as a tip rate when tipping.
Related: Basic Tax-Saving Tips for Investors
Is this a good way to tip?
Do you get anxious when figuring out what to tip when you go out?
Does this change the way you tip?
Let us know what you think.