Originally posted on 05/05/2012:

Tipping system is unfair in many levels. Besides the variability in income (good looking waiters typically get better tips), it allows tax under-reporting, does not benefit retirement plans, the customer may not get a refund of the tip on his business expenses, etc. I agree on tipping as an appreciation gift for an extraordinary service. But now it is more like an expected extra cost for a merely passable service. It is so expected that it is already distributed to the rest of the staff and taxed BEFORE it is done.

From a debate I read:

Tipping is absolutely an arbitrary practice. The practice of tipping simply allows the employer to shirk on the responsibility of paying the worker a living wage. Tipping is the practice of playing the worker and the consumer against each other to the benefit of the employer. This is what the employer gets: he gets to advertise an artificially low price, and he gets to pay his workers a low wage, keeping more profit for himself, because the consumers will pay the worker for him.


This is a flawed system. In an ideal system we would simply have one price where all services and employees wages are built into that price. In fact we do have that "one price" in 99% of the services and products sold in our society. It is only in a specific few that the "one price" method becomes unworkable.