Q&A: Should I modify my tipping in the global financial crisis?

Q What is the appropriate amount to tip? I realise that tipping has never been much of a norm in Australia, but for some reason I still feel obliged to tip at high-end restaurants, and I’m very conscious of the etiquette. I simply don’t know what the proper amount is, if any. In times of global financial crisis, the problem becomes more difficult, as I feel more constrained.

I suppose my question is, what is the tipping etiquette in general, and has it been modified by GFC?

Andrew J

A The short answer is modify your tipping to suite your financial situation.

While Australia isn’t the same as the US where a 15% tip is expected on every ocassion it is, like in the UK, customary to tip 10% for very good service. In London many restaurants add 10% service to the bill regardless. And over there I was quite within my rights to refuse to pay these surcharges if I felt the service wasn’t up to it.

I haven’t seen this practice in Australia – yet.

The interesting thing is that while the economy boomed and good restaurant staff were hard to find, the quality of food and service in many restaurants suffured yet staff still expected tips, which is built-in as part of their pay. Waiters at the very top can earn $100,000+ a year with tips.

Now the recession is upon us the opposite is happening. Staff shortages are a thing of the past and the quality of food and service should improve thus increasing the incentive to tip.

The only rule you should apply is: has the service been good enough – been that special – to deserve a gratuity? If it has pay 10%. If you are in any way dissatisfied then don’t.

But if times are that tough that the tip, um, tips the equation towards staying at home then I would enjoy my meal and tip what you can afford if anything. I wouldn’t be embarrassed about not tipping and know of one Methodist critic who simply refuses to do so.
In the current climate with recent closures such as Seagrass on Southbank and others sure to follow, I’m sure staff and owners will welcome your custom, tip or no tip.

I’d just like to add that one of the difficult things about tipping is that you are never sure who gets the cash. Some restaurants split it among all staff depending on seniority with a portion going to the kitchen. In some restaurants the owners take their cut too. What you pay may not end up in the hands of the person you want it to.

One option if you are drinking particularly fine wine and would like to reward the sommelier – leave a decent amount for him/her drink later.

Anyone else any thoughts? Who’s tips and doesn’t tip? Anybody go up to 15% or 20% for really exceptional service?


  1. I personally think that its un-Australian to tip, you get paid well to perform a job, and our wage structure is such that people in hospitality get paid as well (sometimes more) than many people in factories or in labourer roles, especially in rural communities.
    In my view the best tip you can provide is word of mouth about how good (or otherwise) the service was and ensure that they have a job and income well into the future.

  2. Yep, we tip & have been known to go up to 20% when the service goes above & beyond. On average we tip 10%. I do like feeling that we can choose to tip in Oz, rather than when you are in the states & have to tip everyone for everything, but I guess that is because I haven’t grown up with that culture & I have to remind myself of the pay discrepancies.
    I think it if fair to tip, I don’t think that waiting staff are payed that well & it is a hard job, perhaps those who are anti-tipping should do a spot of work experience at a restaurant….?

    I know a lot of people choose not to tip at cafes, but I think if it is your local, & you would like them to remember how you like your coffee, it might just be worth it!!

  3. No secrets Neil – now, how do you feel about receiving wine as a thank you? I really think that it can be “part”, certainly not all of the tip.

    The wait staff at Tetsuya’s certainly are keen to see what I take and what they may sample as part of their “tip”. More often than not, a bottle or two left for them.

    Even here in gay Paris, the sommelier at a three star restaurant was very pleased to be able to sample the last 5-7 cl of some Grand Cru Chablis. Probably about $50 – 80 worth – so he was happy to see how it was travelling.

    Enjoy it Neil, you certainly deserve it !!!! Hope it has remained sound.

  4. I’ve been told by my many hospitality friends that ‘if you can’t afford to tip there, then you probably can’t afford to eat there’… having said that, i think tips should be earned for great service, wonderful food and a delicious experience and not left out of obligation with or without GFC…Sunita (ex waitress)

  5. Thank you to my secret admirer.


  6. I agree with Ruby. The award rate (even at the base, before loading) is MUCH better than the US and the UK. Why we feel obliged to tip is beyond me. I tip if the service is exceptional. Good service, no. That is what we should expect. it is a SERVICE industry.

  7. I don’t think waiters get paid nearly that much in NZ and having just been back there at Easter can report that the public holiday surcharge is alive and well. GST is 12.5% (I think). Tipping is not standard (to be honest “rare” is a better description) and generally opinion is that service has to be outstanding to get even a nominal tip of a couple of bucks. NZ is much more heavily in recession than Australia and I wonder if this was the cause but I heard a number of restaurants advertise they were waiving the public holiday surcharge. Am hoping that means they were cutting their profit, as a way of getting a few precious punters, rather than stiffing the staff.

    Having paid the surcharge many times in the past, initially its a bit annoying but then I think if its going into the waiter’s pocket I don’t mind. They should be paid more to work when everyone else is playing and there is an honest transparency about the surcharge.

    But the biggest difference between Australia and NZ dining is the quality of the waiting staff. Tips really do make a difference!

  8. With the proposed new award we can look forward to a return to the days when restraunts couldn’t afford to open on Sundays and public holidays or be faced with 20% Sunday surcharges.
    Is anyone else old enough to remember Acland Street when it was quite on a Sunday?
    I must admit bias against the unions on this issue having been threatened, assaulted and followed home by union thugs when instuting Victoria’s first workplace agreements whilst at The George many years ago.

  9. You mentioned you didn’t know heaps about awards and in the comments on this issue many different rates have been mentioned. There is a looming critical issue for the restaurant industry on this topic, and it is something I feel really strongly about, but am not as bold as Mr Prentice!

    Firstly, the award is approx $14-15ph Mon-Fri, day only. If nights, Saturdays, Sundays or Public Holidays are worked, keep adding around $5 per hour for each. So for an untrained, 20yo, no experience uni student working on a Sunday or public holiday, the award would say the rate is upwards of about $35+ per hour. At this sort of rate, most restaurateurs would be better off getting a job as a waiter.

    When workchoices/workplace agreements came in, we could take an average rate across the hours our businesses operated and submit a contract that superceded the award and it was legal to pay $18-20 across the board. With recent increases, and the ‘fairness test’ that now applies to this, the minimum average LEGAL rate for a waiter is around $23 for staff that work across a varied roster, and the government is approx 2 years behind in approving the contracts due to the paperwork involved and I still have 4-5 in the system from 2-3 years ago. This is only the case if you have workplace agreements in place.

    Many restaurants that I am aware of just ignore it all and pay $17-20, hope that no-one knows anything about it all and that staff don’t check their rates or dob them in to the ombudsman.

    The critical issue that is happening right now is the “modernisation” of the award, the various Restaurant & Catering associations across Australia (see links below) have mounted substantial campaigns to target ministers to firstly make the award easier to work with, have rates that are fair and even across the board. However the draft award is apparently pretty much opposite, it will be harder and a lot more expensive for businesses. Basically the new award that is proposed to come in for 2010 I believe will result in a crippling increase in costs for restaurants and it will not be possible for many business to afford this increase in costs.

    I was told whilst away in QLD that next week at the Noosa food fest there is some debate on this topic with the relevant government minister, I believe Berardos has something to do with organising this.

    As a restaurant operator, my tips are shared evenly among all staff including kitchen. But I have recently imposed a stocktake of all glassware that is broken which will be taken from tips in future, I hope they take more care and don’t break so many glasses. I haven’t taken it from tips and hope I don’t have to.

    As a restaurant patron, I tip generously for good service, at least 10%. I have many friends that don’t tip, don’t believe in it, and I have felt embarrassed at times when in a group and no-one else tips, then our group tip looks pretty miserly as it is just my contribution.

    My friends views is basically that you don’t tip the shop assistant or hairdresser for good service, so why the waiter? It is an interesting question, as probably the waiter earns the most.

    Thanks for starting the debate, it’s a hot topic, appreciate your input and sharing of it,

  10. Beige.


  11. Hi
    Interesting range of opinions. We all have our own approaches to these things. I think it’s a bit over the top to go beyond ones own opinion and start telling people what they should/n’t do.

  12. Thanks to everyone that commented on the question that I asked of Ed. As I noted in my question, I’m very concerned with etiquette. Indeed if tipping is appropriate, and I feel that I can’t afford it, then my response would be to dine at a cheaper establishment in the first place.

    I can think of a few places that have really good service. They are the type of places that remember who you are, but the truth is that the reason that you are back there is because they had great service to begin with, along with great food. Movida, Cumulus Inc, Pizza Espresso – I think these probably have the best service that I’ve experienced in Melbourne restaurants, and I’ll always tip accordingly. The service has a familial feel, and they make you feel a part of it, without being overbearing.

    I am more concerned with the service at restaurants where one may feel ignored, or where the wait staff’s priorities are elsewhere. The consensus appears to be to reward good service, and not to feel obligated to tip if the service is sub-par. Another consensus seems to be that the global financial crisis is irrelevant to questions of tipping, and I agree with the reasons that have been given.

    Thank you all for your comments, and keep them flowing.


    Andrew J

  13. Ah, the insults – last refuge of the boorish and unimaginative. Opinions vary; my comments were not personal nor did I attack any individual. I merely offer some different thoughts and question why practices that are entirely relevant in the US are adopted here where the need is not so great.

  14. Vat is 17.5% – the UK equivalent of GST but I don’t think they can add it to tips although many may try.

  15. I definitely go up to 20% if the service is worth it in Sydney, London or otherwise.

    It irritates me how they add 10-15% VAT to the bill in London and that Londoners just pay it even if the service was abysmal (which is often!).

    In London, I refuse to leave the ‘tip’ if the service is bad and believe more people should do this. If everyone pays it regardless then why should waiters bother trying? It just lowers the standard of service.

  16. Interesting to hear all shades of the debate,I shall delete the bit about wine – I think it was Lok Thornton that I got that from, A generous tipper who also leaves some of the decent stuff, very decent stuff, to finish off.
    Neil, if you can send me some clues I am very keen to follow up the dividing of tips among restaurant management. If fact calling all whistle blowers confidentiality is assured and my sources are always protected.
    I don’t know much about restaurant awards – is it the case that tips are built into awards or not.
    $18 an hour is a paultry amount for what is a demanding job dealing often with difficult, obnoxious people. My personal policy unless I have had really shit service is to usually pay 10% and for places I really like and get great service more – especially when I’ve been passed a freebie.
    Clearly this is a contentious topic and deserves more debate and some in depth research. In the trade press I doubt there is the budget to do this and there isn’t the interest among the mainstream press.
    I’ll second Jack, Neil is a legend and a great winemaker to boot.

  17. It is rare for a waiter to be paid anything more than the award ($14.80, plus some loadings at weekends).
    So the only people that are paying for the experience of a waiter is the customers, in the tips that they leave.
    Other industries pay people according to their experience, longevity or education in their line of work, waiters are paid a flat rate no matter. It is understood that the tips they earn from that experence ‘top-up’ a very basic wage. A professional with years of experience (and no doubt love of the industry, hence thats why they are still doing it) is no doubt going to be able to offer you so much better service than the the uni student that is just doing it for the cash, until they ‘get a real job’.
    You may not like the system, but it works, if you like the service you recieve, then pay for it.
    NB Neil, you’re a legend! Ruby obviously has no idea of the iconic status you hold in the industry…

  18. Whilst being happy to identify myself, I have inadvertantly acknowledged that I occasionally shuffle around at Libertine. I presume, Ruby, from the missionary postion thoughts you have expressed here so far, that you are too smallminded to differentiate between my thoughts and those of my occasional employer, so if you’d like to be called a tight-arse in more imaginative ways than you think jake done has please feel free to contact me at neilprentice@hotmail.com or on 0408 666 348
    …yes that is a Revelations 13 reference…
    Can I presume that as “it’s far too simplisitc to say that money is the only acceptable form of recognition for doing a good job” you have an arrangement to pay the lease on your Lexus with something other than cash?

  19. Whoa! I don’t think it’s a matter of being a tight arse! That’s such an unimaginative response. Surely the cost of service is built into the prices charged – if managed correctly. Good restaurants will expect their staff to provide appropriate service and they will retain good staff if paid and rewarded fairly.

    The question is whether tipping should be standard when award wages are paid. Why should waitstaff automatically expect to have their pay topped up by the customer? In many other industries, cash supplements are prohibited – even when people do a good job. Also, it’s far too simplisitc to say that money is the only acceptable form of recognition for doing a good job.

    $18 per hour is reasonable for the work undertaken. I would certainly expect someone on that rate (in any industry) to do their job well, and that includes providing good, knowledgeable service. It’s terribly arrogant to say that because waitstaff are only paid $18 per hour you can’t expect them to do a good job.

  20. Ruby… you ignorant tight arse…

    Do you expect to have a knowledgeable seamless service professional for $18/hr (if lucky) with no tips… pull the other one mate… you’d be serving yourself…

  21. i do agree with the idea that if you can’t afford to tip it’s not a good idea to eat out.
    however, having said that, i would only tip 40% of the time.

    my considerations are:

    is the water glass refilled when it is empty? if i have to wait 10 – 15 minutes for water, or have to ask for it, then how cna it be said that the waiters have done their job?

    are the waiters polite and only venture into conversation when they know it is welcomed? too mayn times i have had waiters that are more interested in telling me their life story.

    is the food as expected? if there are wilted salad leaves, do you tip? too often i have seen rocket that even i would not eat at home being served to me.

    it’s those little things that i think are important. i agree with neil – waiters should be unnoticed. and yes i have been to libertine, and i think i can recognise this person.

    at the end of the day it’s your dining experience and if you have had a bad night because of poor service, why should you tip?

  22. Sorry, but tipping is a rort! Waitstaff are paid enough in Australia and should not beg for more.

    There are many service industries where the conduct of the staff affects your experience, but tipping is not expected because they are doing the job they are paid to do. If hospitality is your job, then just do it! The lure of more money at the end should not motivate a waitperson to perform better.

    What does the tip actually represent? Is it a reward for doing a good job? If so, why isn’t it more common across other industries? Is it compensation for low wages? That’s just not necessary in Australia. It may be low paid work but it’s regulated (yes – there are some unscrupulous operators but mechanisms exist to deal with this). Is it recognition for a particular person on a specific occasion? Then how do you ensure that person gets the money?

    Indeed, is money the best way to recognise or reward someone? What about a note to management highlighting the positive experience? What about a bouquet of flowers or a bottle of wine? Or is money the only currency with any value?

    Another issue to be addressed is that of service itself. We need to be more respectful of service staff and appreciate the work they do. Some people don’t know how to receive service and some staff don’t know how to deliver good service. There are issues about status and power that colour the server-customer relationship.

    But the main point is that if service if your job and you’re paid an award wage – then just get to work!

  23. whether some goes to the manager, is used to pay for staff drinks after work, or pays for the glasses they broke in service

    should some go to pay for toilet paper if the owner is an arsehole ?

  24. I find it sad that in 2009 this even needs to be discussed. A poor reflection on the old urban myth “you’ll never go broke underestimating how tight Melbournians are”.
    As an ex restrateur, still occasional waitperson (as the youngest, sveltest emergency plate carrier at Libertine) and frequent diner I firmly believe the rules are;
    A waiter should be as a football umpire – unnoticed. If this is the case 10%.
    If you cant afford this then choose a cheaper restaurant in the first place. I’m certain you’re the same miserable bastards who are not subscribers but listen to RRR and PBS. Cough up you freeloading bastards.
    If service is beyond expectation then more according to your enjoyment of the situation.
    If you notice that the service is poor then it should be reduced or indeed don’t tip at all if you find incompetance.
    Kitchen staff SHOULD NOT RECEIVE a %age of tips. They are generally handsomely paid and can forge a career if they work hard and have talent. In all my 45 years I have never met an underpaid chef – and rarely met a generous one.
    Tipping in wine is another tight-arse, demenaning trait. It it wonderful to leave wine for wait staff, especially junior staff, but it is not part of a tip.
    I also have MAJOR concerns about restaurants which keep a %age of tips. This is more common in Melbourne than one realises and I am surprised no journalist has ever tackled it.

    For those of you who don’t tip;
    May you always be served by sour NIDA rejects and backpackers, rather than by professional waiters who take pride in their work and understand the term “hospitality”. Lets hope your karma catches up with you at some stage.

    Neil Prentice

  25. Tips are earnt, simple as that.
    The key point to remember is that they make up the difference between the base wage ($15ph) that all waiters get – no matter their experience or skill – and the amount of money a professional waiter needs to earn to stay in the industry and keep looking after appreciative people.
    If you like what you see, leave 10% + like I do, if not tell the manager and leave less.
    As for the GFC, if you can afford to dine out then you can afford to tip appropriately…

  26. I am in agreeance with those who precede my comment- tip if the service has contributed to your enjoyment of the dining experience. If the waitstaff have been merely perfunctory, just pay the bill – they will get their wage and either be driven to greater service standards or get the impression that hospitality is a poorly paid profession and give up! Regarding how a restaurant/cafe/bar might distribute the tips, I must say, butt out! It is none of your business – the staff have obviously accepted the terms of the system in operation. The gesture is appreciated regardless of whether some goes to the manager, is used to pay for staff drinks after work, or pays for the glasses they broke in service. Customers are not expected to subsidise wages in Australia, but encouraging excellent service is in everyone’s interest.

  27. I always tip about 10% at decent restaurants unless the service is BAD. I think it’s highly personal – no rules. If it’s a stretch to eat at a fine establishment you may be worse off than the waiter. In Oz you should not feel bad about not tipping if, for any of a multitude of reasons, you don’t wish to. I don’t tip at buffet restaurants and there is one I find excellent – The Melba at the Langham. In USA 20% is now the expected gratuity and for parties of 6 or more they just add it to the bill! (or check as they call it)

  28. I only tip for excellent service. Unless we are dining with particular friends and they always tip regardless of service…I think they want the wait staff to like them and know them when they dine there again.

  29. My rule is simple, 10%-15% if the service adds to my enjoyment of the culinary experience, 0% if not! Unfortunately it often detracts from my experience.

    I see tipping as my choice and a chance to show my appreciation, rather than an obligation.

  30. I tend to leave tips, unless service has been really poor (& then if the food was good, but service poor, I have found my way to the kitchen at times to leave the kitchen staff a tip).

    Bottles of wine, from my cellar, are often taken to restaurants and left as tips (makes it difficult for some staff seeing you come into licensed premises with a bottle of wine-but attitudes change when they realise I don’t intend to drink it). I am not as adventurous with dining nowadays, tend to stay with the same olds, and so the regular haunts usually reward me too.

    There seems to be wide variation in how tips are distributed. It would be great to be able to tip individuals based on performance. But I still worry that those out the back may not be getting their share – for great food.

    Hotel restaurants certainly do vary – in Sydney there are some fabulous 3 star restaurants in hotels, but yes, the buffet ones …..
    Remember many of our stars did time in hotel restaurants (including Raymond C). And of course – there’s now Nuevo (not Neuvo) 37
    http://www.theage.com.au/travel/bold-new-hilton-opens-20090416-a8r1.html?page=-1 .

  31. Thanks, very interesting, I have been pondering the same question since I planned my travel States-side for later in the year. It is unfortunate that tipping in the State is ubiquitous as the ‘busboys’ and waiters are probably on about $2.50 an hour…

    Thanks for sharing your insight on how tips are distributed, I have often wondered whether they go straight to floor staff or whether the kitchen also sees some of the action.

    Personally, I always tip for good service, though it usually falls between the 5% to 10% mark (depending on how many hats the restaurant has, and correspondingly, how much dough I forked over for their delicious food) because I am still but a wee lass on a shitty salary. Though I do have some friends who consider tipping an overseas phenomenon and baulk when I leave a tenner with the bill.
    It is rare for me not to leave a tip, even in a cafe, though yesterday’s visit to the seafood buffet at the Sheraton on the Park (for a staff farewell, they made me go goddamnit!) was a rare exception: the way our pimply waitress awkwardly poured the wine caused me to stifle giggles, and for $95 a head (ouch!) the service was very poor. The lesson to learn here? Don’t eat at hotel restaurants, especially if they’re buffets.

  32. In NZ the tipping culture is even worse. Not tipping is the norm. So it has taken me years to get my head around the ‘to tip or not to tip’ idea. As far as wait staff are concerned, if this is their profession and they do their job well, tipping to me is mandatory. Their real income is from tips, elevating from McDonalds style servers to the people who can make or break it as far as having a great night out is concerned.

    The biggest tippers I’ve found are those who work, or have worked, in hospitality. They know how necessary the tips are for making a decent income.

    But for cheapie meals at the local, served by the owner who knows you by name? He rounds the bill down and gives me my tip back!

  33. Sommelier would much rather have the money… fine wine at zero cost comes with the job…

    Quality staff are still in huge shortage despite the GFC…