RE: Tip or tax?, North Island Gazette, March 27.
Last week a reader took issue with the growing practice of automatically adding tips to your bill at restaurants, and invited feed back. To begin with I want to state that I agree to the distasteful nature of this practice which takes away the voluntary aspect of tipping.
Not everyone is aware that people working in the food service industry are not bound by the minimum wage laws. The theory being that tips will more than make up for the lower pay scale. Real time does not always mimic theory though. Also taking care of a table with four clients involves more effort than four tables with one client.
It might give cold comfort to know that tips are considered taxable income. A long time ago when I worked in the field, we would put all the tips aside and at the end of our shift it was split among the staff and with a nudge and a wink it was forgotten about. Now the government wants their cut and so by having automatic tips, this makes it easier for Ottawa to find this income.
I think establishments should be more upfront if they carry out this practice, and that this policy will have a bitter aftertaste for a lot of people.
Donald J. Allen