Why Some People Always Tip Even If the Service Is Bad, and How Much

Why Some People Always Tip Even If the Service Is Bad, and How Much
  • Many businesses are embracing tipping as a way to avoid raising pay for their employees.
  • While many customers don’t tip, those who do are helping businesses keep their prices stable.
  • We spoke with three people who almost always tip to find out why they give as much as they do.

More and more US businesses are asking customers for tips, and many Americans aren’t happy about it. But despite turning off some people, many businesses are benefiting in a big way.

That’s because not everyone hits the “decline to tip” button at the checkout counter. Some people are happy to tip almost every time they are prompted, and they’re helping businesses pay their employees more without cutting into profits or raising prices.

Take Ryan Farley, a 33-year-old lawncare worker in Austin, Texas, as an example. Farley told Insider that he usually leaves at least a small tip whenever businesses prompt him, even if it’s for something that didn’t require much “actual service” — like buying a drink at the counter. 

“In my way of thinking, it’s usually only a couple of bucks that I can easily spare and might make a difference for someone,” he said. “I would never expect everyone to tip the way I do, but honestly — I worked retail and service jobs most of my early adult life, and I know how grueling they can be. So I never mind tipping even if there wasn’t much service.” 

Whenever he’s in a situation where he’s not sure how much to tip, he said he typically uses 15% to 20% as a baseline, and only ventures as low as 10% for some “low-effort situations” like counter service or food takeout. 

Customers like Farely aren’t just helping out the workers they tip, or as critics might put it, making it easier for businesses to pay their employees less. They’re also helping businesses keep their prices in check for everyone. So even if you hate tipping culture, you could be benefiting from it. 

Tips are helping some businesses keep prices stable

16% of the 517 small businesses surveyed for a July Wall Street Journal article by the employee management software company Homebase ask customers to tip when they check out, up from 6% in 2019. One example of this is Dan Moreno’s Miami-based appliance service business. In 2020, Moreno began giving customers the option to tip his home-repair technicians, he told the Journal. 

Now three years later, he said roughly one-third of customers leave a tip of between 10% and 20%, adding an average of $650 a year to his technicians’ salaries. If he hadn’t embraced tipping, Moreno told the Journal he’d have had to find another way to boost his employees’ pay. And given his business’s thin margins, he said raising prices even higher than the 18% he already has since 2019 would have been his only realistic option. 

So even though most of Moreno’s customers don’t tip, the contributions of those who do have been enough to keep his business’s prices in check for now. A similar story is playing out at businesses across the country, Laurence Kotlikoff, an economics professor at Boston University, previously told Insider

“Businesses are being squeezed and hoping that their customers will, in effect, be willing to pay more on a voluntary basis,” he said regarding the rise in tipping options across the US.

But this strategy will only keep working for businesses like Moreno’s as long as enough “always tippers” are willing to shell out extra money. 

In addition to Farley, Insider spoke with two other Americans who rarely pass up the chance to tip to learn why they tip as much as they do and whether they plan to keep this up going forward. 

Personal experience working in the service industry causes some customers to tip almost every chance they get

Camille Rogers, a 25-year-old Manhattan-based publicist, told Insider that she usually tips whenever it’s an option. 

She said working in the hospitality, food service, and retail industries over the course of three years gave her a firsthand appreciation for tips.

“Don’t get me wrong, I definitely live paycheck to paycheck,” she said. “But money tends to come and go, so if the going part is to help someone else out, I’m all for it.”

Rogers said she generally tips when a checkout screen prompts her — particularly at counter-service restaurants or coffee shops. Whenever she receives a paycheck, she habitually goes back through her rideshare apps to ensure she tipped every driver. She also said she regularly tips vendors at events and markets using direct payment apps like Venmo, Zelle, and Cash App. Insider viewed some of Rogers’ recent tips, and each were more than 20%.

Even poor service won’t stop her from tipping. 

“If I experience subpar service, I typically try to understand why it could have happened with the parties involved and if there’s the option to seek out customer service support or provide feedback,” she said. “I’ll seek that out instead of withholding a tip.”

KaLyn McCullough, 24, a PR account executive based in Hartford, Connecticut, said she tips almost every time she gets the chance. Like Rogers, Insider viewed recent tips from McCullough of more than 20%.

And, also like Farley and Rogers, McCullough’s views on tipping were molded by her past experience in the service industry — she worked as a restaurant server for three years in college.

“Before I began serving, it never crossed my mind that servers hardly make an hourly wage,” she said, adding, “Now having been in that position and relying on tips to pay my rent, put gas in my car, etc., I always tip.”

McCullough said she regularly tips at coffee shops — even $1 on a $4 coffee — and always tips when she picks up takeout at restaurants. 

“Some people don’t tip on takeout orders because, ‘Well why would I pay you for something I could just do myself?'” she said. “But you’re not doing it yourself. You chose to buy food from a restaurant — you’re paying someone to do something you didn’t want to do yourself.”

At sit-down restaurants, McCullough said she usually tips 25% to 35%. She said the only time she didn’t leave any tip at a restaurant was when she had a “terrible” server roughly seven years ago. 

“In hindsight, I know I should have tipped,” she said. “Even if it was 10%.”