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MARKETANALYST.US / ECONOMY & WORK

Customer Exposes Misleading Tip Calculations on a Bill, Sparks Debate on Tipping Policy

O'Brien asserted that the discount was not communicated during his dining experience.
PUBLISHED MAY 3, 2024
Cover Image Source: Misleading tip calculations on a bill (representative image) | Instagram | @big_beau7
Cover Image Source: Misleading tip calculations on a bill (representative image) | Instagram | @big_beau7

In a recent viral video shared on social media, a tipping controversy has ignited discussions about the evolving customs of gratuities, particularly in the wake of pandemic-era shifts in dining and service industries, per ABC News. Mark O'Brien's Instagram post showcased a perplexing encounter with an electronic receipt displaying suggested tip percentages, which seemingly misstated the calculations on his $27 bill. O'Brien pointed out discrepancies, noting, "15% of $27 is not $6, 18% of $27 is not $7, 20% is not $8."

Instagram | @big_beau7
Instagram | @big_beau7

The video quickly gained traction, sparking a wave of commentary from viewers expressing frustration and confusion over tipping practices. Many commenters argued that businesses should bear the responsibility of adequately compensating employees, suggesting that tipping has become excessive and inequitable. The payment device shown in the video includes a disclaimer indicating that the tip calculation occurs after tax and before any discounts are applied. According to the unnamed restaurant, Mark O'Brien received a discount on an entrée that he returned to the kitchen. Although he was not billed for the item, its discounted value was factored into the suggested tipping percentages displayed on the receipt.

Instagram | @big_beau7
Instagram | @big_beau7

In response to the controversy, a representative from the restaurant clarified to ABC News that their tipping policy is transparent and includes a disclaimer informing guests that tips are calculated before any discounts are applied. The restaurant also allows customers to enter a custom tip amount for convenience manually. O'Brien asserted that the discount was not clearly communicated during his dining experience. "I want to raise awareness about this issue," he explained to ABC News, regarding his decision to speak out. "But certainly, don't direct any frustration towards the servers, because they're simply trying to earn a living like everyone else."

Unsplash | Photo by Blake Wisz
Unsplash | Photo by Blake Wisz

John Waldmann, founder and CEO of restaurant software Homebase, shared with ABC News that the current confusion and frustration surrounding tipping are understandable. "The changing expectations and behaviors related to tipping over the past four years have contributed to consumer frustration," Waldmann commented. "I believe this has led to significant confusion for many people."

One user@fpsanthony said, "I really don't care. If you’re going out, it is because you have money." Meanwhile, @gchabursky said, "Just so you know 15% was actually 23%, 18% was actually 27.66%, 20% was actually 30%, 25% was actually 38.4%." @onekeenshot said, "Custom and hit zero." @scottygolden01 said, "The real problem is tipping culture. If a person gets a hamburger for $12 and another person gets a fillet for $40, the amount of effort for the server is pretty much identical. Why should one pay more than the other?" @mooslashie chimed in, "That's a class action lawsuit waiting to happen." Another user @kbran03 said, "After tax and before discounts. Did you have a coupon or use a gift card prior to this screen?"

Instagram | @big_beau7
Instagram | @big_beau7

In a recent incident, a Los Angeles woman took to TikTok to express her frustration with the expanding culture of tipping in the U.S. Debbie Nohemy (@debbienohemy) posted a video specifically criticizing the expectation of tipping at Starbucks drive-thrus and pick-up counters. She emphasizes that her issue isn't frugality, acknowledging the role tipping plays for waitstaff and those directly involved in food preparation. Nohemy argues that the tipping norm is going too far when it applies to service industry interactions where minimal service is provided, like simply taking an order and handing off a beverage.


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