The Compensation Conundrum

Who, what, when, where and why we tip

Story by ALYSSA HIGH | Illustrations by LAUREN ALLEN

You walk into a restaurant. A coffee shop. A bar. A clothing store. You get your drink or other product, and as you tap your card on the scanner, the employee flips their screen around, prompting you to choose an 18%-22% tip. You’ve got questions. Where does the tip go? What are you even tipping for?

Questions about tipping aren’t new. In fact, historical accounts show that Americans were apathetic to tipping wages in the 1860s.

“I don’t understand some businesses that are asking for tips nowadays,” one Dallasite says on Nextdoor. “Why would I tip someone for ringing up my Big Gulp. Pretty soon we will be prompted to tip during self-checkout.”

Others question the percent system, as the cost of the food doesn’t affect the server’s amount of work.

“Now, if we order a $50 bottle of wine, that’s $10. If we decide to order a $500 bottle of wine, I am expected to tip $100,” another neighbor chimes in. “Why is that? The same amount of effort went into the service.”

Others are starting to notice the flip-and-tip at retail establishments, where full-service isn’t occurring.

“I am baffled by the tipping option in retail stores,” one Redditer complains. “Honestly it is a little off-putting. In fact, it has made me stop going into stores to shop.”

So, when do you tip?

Each owner and type of restaurant has a different school of thought when it comes to tipping and wages.

“In full-service, tip/gratuity should be more than 20%, just because of the economy the 15% is definitely obsolete,” Haystack owner Kevin Galvan says. “It should be more like 20%, 22%, 25% because of the amount of work these people are doing for $2.13 an hour.”

In Haystack restaurants where the dining isn’t full-service, employees are paid an hourly wage, and tips are earned by employees going overthe-top.

“We make sure they’re doing something for the tips, so drinkware, refills, pre-bussing tables, offering cloth napkins, trying to offer a fullservice experience even though we are fastcasual,” Galvan says. “I’ve never asked for big numbers from people because some people ask for 15%-20% on a $60 tab but you’re not doing $12 worth of work.”

Galvan pools tips among all employees, which he finds encourages every member of the team to give the best service possible.

Others, like White Rock Coffee, apply the same teamwork-style tip pool but to tipped wages.

WRC baristas split tips among all locations, and then tips are divided by the number of hours worked for each employee. This system increases wages for baristas in locations with a slower pace, with locations like Lake Highlands seeing less activity than locations in East Dallas or Preston Hollow.

“[I prefer] making a tipped wage because it’s really up to you how much you make,” says Samantha Oser, a barista at White Rock Coffee.

The tipping struggle isn’t limited to dining. Hairstylists, for example, make tipping wages at most salons and often don’t get to take home the full charge for the service.

“You’re usually splitting the cost of service with the owners. Depending on how much the commission percentage is, you can take only 60%, 50%, 40% or 30% home with you,” Kristian Taylor, a cosmetologist at Capelli Salon in Preston Hollow says. “Unfortunately, there are a lot of us who rely on those tips just to make ends meet. … A lot of people don’t realize all of the education and hard work that comes behind a service. For instance, if I worked five hours on your hair and it came out beautifully, it’d feel great to be shown that you’re appreciated by receiving more than 20%.”

TERMS:

Tip-out/tip share: In many restaurants, servers share a portion of their tip with other tipped employees, particularly those who have helped them in their shift. Commonly, this includes bartenders and bussers. This can be based on a percent of sales the employee had or a percent of their tip, depending on the restaurant’s policy.

Tipped wage: In Texas, $2.13 per hour. If the employee doesn’t receive the equivalent of $5.12 per hour, employers must make up the difference to meet federal minimum wage requirements.

Automatic gratuity: Some restaurants have automatic gratuity for large parties. High-end restaurants might include an automatic gratuity regardless. This ensures that the server is receiving adequate pay. If the automatic gratuity is around 20%, you are not expected to pay an additional tip.

Front-of-house employee: Employees who work in the front of the restaurant and typically make tipped wages. Can include servers, bussers, bartenders and hosts.

Back-of-house employee: Employees who work in the back/the kitchen. These employees typically make hourly wages and could include cooks, quality assurance and dishwashers.

Why do we tip?

Federal and state labor standards allow employees who receive tips to be paid a lower minimum wage than hourly employees. In Texas, this wage is $2.13 an hour, though if the employee doesn’t make $5.12 per hour in tips, the employer must make up the difference.

How is this decided?

At the end of the shift, employees clock out and calculate how much they have received in cash and electronic tips. Tip-out, if applicable, is also calculated. Some are given their electronic tips at the end of the shift. Others wait for a weekly, biweekly or monthly paycheck.

Who receives tipped wages?

Drivers, delivery personnel, hairdressers, servers and bartenders almost always receive a tipped wage. Recently, some coffee shops and restaurants have made a switch to higher hourly wages.

Why do restaurants use tipped wages rather than hourly wages?

Restaurants can have lower prices on food if they pay their servers less. Servers can make more money off of tips than they would on an hourly wage. Tipped wages incentivize employees to up-sell to their customers.

Why eliminate tipped wages?

It would eliminate the wage gap between front-of-house employees and back-of-house employees. The wage gap between servers at restaurants that tend to have higher tabs and those with lower tabs would be smaller. Wages for tipped employees would be more regular, leaving them with a liveable wage regardless of tips. Calculating income tax would be easier — many servers avoid reporting their full wages to the IRS by not reporting all of their cash tips.

HOW MUCH DO I TIP: Servers……………………….20% of the bill

before tax

Bartenders…………………...20% of the bill before tax or $1 per drink for simpler drinks like beer

Baristas………………….…….20% is always nice but not required, many make hourly wages

Tucked in the back corner of the Preston Royal Southwest shopping center, Gazeebo Burgers is just off the beaten path for those new to the area. However, generations of loyal patrons have kept the spot open for over 30 years.

Owned by Ray and Lisa Heydari, Gazeebo Burgers serves up American staples: hamburgers, chicken dishes, salads and veggie burgers. It’s the kind of spot that has something for everyone — a place that can please your kids and your in-laws.

But beware: If the family drama gets out of hand, this burger spot does not serve alcohol.

Pete Sopithakul has been a manager at the restaurant’s flagship location for decades and has witnessed it grow through the years. His favorite thing about Gazeebo Burgers is simple: People leave with smiles on their faces.

“I enjoy working here because people come back and they’re happy,” he says.

Sopithakul tried to retire a few years ago, but customers noticed his absence.

“I didn’t work for three years and they called me. ‘You need to come back because a lot of people are asking about you,’” he says.

Upon his return customers were delighted to see Sopithakul, exclaiming things like “I’m so happy,” on multiple occasions.

Sopithakul has become an icon in the community as his status at the counter has earned him on-sight recognition as a local celebrity.

“‘Hey Mr. Gazeebo!’ They know, they recognize me,” he says.

With games for the kids and large party seating in the iconic gazebo out front, the burger shop is the perfect example of American classic dining.

“We have been going for 36 years and he has watched our boys grow up,” Amie Serral-Moyer, a loyal patron, says in a Facebook post.

And ironically for the burger spot, the grilled chicken sandwich is the most popular item on the menu. Get it plain for $11 or California-style with avocado and cheese — you can even add mushrooms — for $13.

“The chicken is for everybody. They say, ‘It’s the best,’” Sopithakul says. “No where [else] they can get it. It’s the best.”

Aside from chicken sandwiches, guests can enjoy the classic half-pound Gazeebo Burger ($11.50), turkey burgers (the basic one is $10.50), vegetarian burgers (garden or black bean patty, $9.25) chicken tenders ($12) and more. Add on a side of fries (sweet potato or regular) or onion rings for a couple dollars more and you’re on the road to stomach satisfaction.

And don’t forget the honey mustard! It pairs perfectly with every menu item.

Changing With The Times

The original location was damaged in 2019 when tornadoes ripped through Dallas. Although Gazeebo Burgers had to close its doors for repairs, the restaurant offered carry-out services until they were able to reopen.

“During the rebuild we would have people come check. ‘When are you going to open?’” Sopithakul says. “It took two years.”

With the tornado and time, things at Gazeebo Burgers have definitely changed over the years. Updates have been made and the space has shifted, but the welcoming atmosphere of the spot has stayed the same.

“I like the old-times ‘vibe’ I get from the decor,” Joyce Meyer, a customer of Gazeebo Burgers, says in a Facebook post.

The brick walls, fixin’s bar and cool-toned neon lighting above the order counter give the place a unique vibe — one that’s hard to put a name to. It’s homey, yet not too homey. It’s retro and contemporary at the same time.

Simply put, it’s the Gazeebo Burgers that people love.

“People [are] born here, grow up here, go away, come back,” Sopithakul says. “Grandpa, mom, kids. They’re all coming here.”

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