Skip to content

EVERYTHING KING: Tip creep? You can say that again!

As Wendy explains in this week's column, it's a new way for businesses to get more of your cash... and you might not even notice
Stock image

This may be my tipping point.

Have you noticed lately, when you pay with debit or credit card, being asked if you want to add a tip on top of your purchase?

I know we are used to that at restaurants and nail salons, but this technology is showing up at businesses where you don’t normally offer a gratuity.

It's referred to as ”tip creep” and it's creepy alright!

You may notice the option on digital terminals now at hotels, garages, landscaping businesses and liquor stores as well as taxis.

According to Simon Pek at the University of Victoria School of Business, it is becoming a lot more common.

“Since a lot less people are carrying cash, it's easier than ever for any business to ask for a little bit of extra money by adding the automatic prompt to the card payment. Psychologists have dubbed it a tip nudge."

Sounds like trickery to me.

It's a sneaky way to distance me from more of my money. I might not even notice.

Things definitely changed a bit during the pandemic. Remember when a lot of places preferred we pay with debit than cash? Well, it was about the same time some businesses added that tip option to their terminals.

There has been a tremendous amount of discussion about the need for higher wages.

Could this be a ploy to get the consumer to once again pay a little more so big companies don’t have to?

Economists say that may be one of the reasons.

And that annoys me. I always believed a tip was for exceptional service, but it should neither be forced nor mandatory.

The typical amount used to be 10 per cent, but according to tipping etiquette in 2022, that has now unofficially been raised to 15 to 25 per cent.

People seemed to have become more generous post-COVID when we realized how important those retail and service jobs were to us all.

Tipping, to me, is a nice gesture, but should not be expected.

It should be a personal choice, but those terminals have pre-set amounts. 

That is likely part of the nudge. Their preferred amount is right there for us to easily click on.

Researchers who study such trends believe users will take the easiest route and do whatever requires the least physical or cognitive effort. So picking a pre-loaded amount is easier than changing the tip amount to what you’d really like to give. There are usually three choices and vendors are opting you won’t choose the least expensive option lest you be considered a cheapskate. Most folks will go for the middle option. 

Then, you are neither a skinflint nor a Kardashian. And let’s face it, they’ve got our number!

I always tip for a haircut. However, if the stylist owns the shop, then I likely won’t.

I can’t imagine paying my mechanic extra. That bill is already high enough.

Restaurant servers deserve big tips, but if it’s takeout then there’s no added bonus.

I know in England and Australia tipping is just not done, or should I say rarely. It's not their custom.

According to Google: “Workers don’t officially have to rely on their tips to live and all staff in the UK must be paid at least the minimum wage. Employers are also banned from topping up wages with tips from customers.”

As of this October, Ontario’s new minimum wage kicks in. It will be $15.50 per hour up from $15 and students under 18 will get $14.60 up from $14.10.

We are all individuals with differing opinions and bank accounts. I just want the opportunity to decide for myself who deserves my extra money.

Reader Feedback

About the Author: Wendy King

Wendy King writes about all kinds of things from nutrition to the job search from cats to clowns — anything and everything — from the ridiculous to the sublime. Watch for Wendy's column weekly.
Read more