Is it principled to tip less if a pricey restaurant doesn't accept Visa or Mastercard?

Question

Last month, I spent $230 CAD at a restaurant. Yesterday I spent $150 CAD at another restaurant. Both high-priced restaurants in Toronto accept just cash or debit, no credit. I'm using final prices, after tax and gratuity. I'm just talking about Visa or Mastercard – I know many merchants in Canada don't accept AMEX.

I hadn't come across restaurants in Canada that don't accept credit cards before – even fast food in Canada do! Hence it didn't cross my mind to ask up front. Then when the bill arrived, I had to leave the restaurant, hunt for a branch of my credit union, drive there, drive back to restaurant.

Their no credit card policy be-deviled me, and I tipped just 5% in total. The manager in a black suit then riled up, and insisted that I pay at least 10% tip. I stressed that it was nothing personal – their no credit card policy was the pickle. But he blamed me for not asking if they accept CCs before I ordered. Who's right here?

Answer 1

Everyone here is claiming that your actions didn't hurt the manager-- but under Canadian law, they absolutely can.

Managers are allowed to keep the tips and gratuities they receive themselves, and generally may participate in tip pooling arrangements if their employers’ policy permits them to do so.

Employers are allowed to keep the tips and other gratuities that they receive themselves.

I'd be willing to bet he was collecting tips and retaining them for himself in some way.

I couldn't find Canadian minimum wage laws in my quick-and-short google search (hopefully they're better than they are here in the States), but in America there is a policy that essentially says, "You can pay tipped employees less than minimum wage. However, if that wage + their tips doesn't total out to be greater than or equal to the minimum wage, the business is responsible for making up the difference." This allows businesses to pay their employees less if you make up the difference for them, so their workers only set them back a $2.50/hour instead of the mandatory minimum (those numbers obviously vary regionally).

EDIT: Per the comments below, Canadian minimum wage tipped services law IS different (and better than) American minimum wage tipped services law. An individual working a tipped position will receive their tips in addition to minimum wage, and it will not be counted as part of the minimum wage payment. Employees in the liquor serving industry (IE bartenders) may apparently earn less than minimum wage due to the tipping, but this appears to be the only exception. (credit to @RossRidge)

I really hate the tipping system and wish there was a decent way to do away with it, but sadly, there isn't. At the end of the day-- as much of a jerk as the manager was, and as likely as the manager was to have taken at least a cut of the tips-- this does still impact the cooks and servers more heavily than it does the manager, and it probably comprises a greater percentage of their supplemental wages. As others have said, it's emotional blackmail. You're damned if you do and damned if you don't.

Answer 2

There are a lot of answers here gatekeeping the employers responsibilities to the staff, and passing them on to the customer. It is not a consumers business or responsibility to pay staff wages. It's a pernicious tradition in North America that people who work hospitality jobs are entitled to a pay bump fronted by the customers of whatever entity pays their actual wage.

The proprietor of the establishment has made a business decision not to accept credit cards at their place of business. The staff should clearly communicate that decision, particularly if it is not a well assumed fact, to the customers at the point of order/consumption so that the customer has a chance to make an informed decision about their purchase from the business.

If the customer is unhappy with the service or product they have been provided, which in this instance includes the method of payment causing a disturbance to their evening because they had to source different means to pay. It is always a bad idea to blame a customer for an internal matter because you will almost certainly lose at least one customer.

The blame in this situation lies squarely on the shoulders of the proprietor of the restaurant. It is up to their staff to communicate the effects on the business of management decisions. In the world of public corporations it would be a disciplinary offence to berate a customer for executing a contract as stated because it negatively affected your compensation from your job. It would almost certainly mean jail time if you demanded that they pay over the contract amount to line your pocket.

Answer 3

Disclaimer: I live in Europe where we pay people at least minimum wage regardless of whether they get tipped or not. Tipping is not in our culture and leaving pennies or even nothing on the table as a tip is fine in most circumstances.

Tipping is not mandatory anywhere, it is only customary and I know that in North America that custom feels like an obligation but it still isn't one. If it were, it wouldn't be up to you to set the amount and it would appear directly on the bill.

Going a bit off topic but I would also add that it's a custom that a lot of restaurants use to hide behind the fact that they're paying their staff less than minimum wage which is outrageous to me. Restaurants should pay their employees fairly without relying on a tipping custom that customers may or may not uphold.

The amount you give as a tip is left to your discretion and your discretion alone. You decide what to give based on whatever criteria you may deem worthy. If you want to give 5%, then give that. If someone complains, you could actually take it all back and give nothing instead.

Answer 4

What you did is perfectly fine. This way the staff, at all levels, will be motivated to raise this issue with their managers, which might lead to a change of this stupid policy.

Answer 5

I agree with the other posters that to reduce the tips (supposedly given to servers) because of an incovenient policy is poor judgement. You should not have done that.

Also, if you were able to get cash out of an ATM, you were almost certainly able to use that card to pay the bill, making the level of inconvenience very low. Every credit union cash card I know of is also an Interac debit card.

However tips are always optional, and a reward for service. Being yelled at by a manager is poor service. If he had done that to me I would have reduced the tip to zero.

Note: It is likely that the manager was upset not so much out of concern for his staff, but because he has to make up the wages of his staff to minimum level if they don't get enough tips.

Answer 6

You've attempted to affect change in the wrong part of the process.

You tip based on the service that you received during the meal. If the (related, but tangential) service of paying is not a pleasant experience, insist on seeing a manager and then air your grievances. With enough wit (see interpersonal.SE), you may be able to get some of the cost of the bill waived — perhaps the drinks or apps are on the house. But, you'd still tip your server appropriately based on the mealtime service that you received.

It's important to set your sights in the right direction in order to avoid impacting the wrong people.

Answer 7

You were understandably frustrated and within your rights to do as you did. Additionally, it wasn't the manager's role necessarily to demand what tip, if any, you give. As most are pointing out, though, you've punished the workers who at worst made the mistake of accepting work from this company.

One path you might have chosen was to tip as you would have outside of the payment experience, then discuss with the manager how it impacted you and how it will factor into your future plans to dine at that establishment.

Answer 8

It is written on the menu that Lobster Port No.1 does not accept credit cards. Arguably it is small print at the end of the menu but it is there.

Form of payment: Debit card and Cash only

https://www.lobsterportone.com/dinner-1

I think this may be a bit of a clash between "regular" Canadian norms and Chinese Canadian norms regarding credit cards, particularly as you seem to have happened across it in two different restaurants.

Answer 9

By not accepting credit cards, the restaurant saved about 2-3% of your bill in merchant fees. Most retailers bake that into their prices, so it's not obvious to consumers. In this case, either the restaurant charges lower prices, or increases their profit margin.

Neither of those hurt you directly (you were inconvenienced by not being able to use the card you want to use), but reducing your tip does not hurt the owner - it hurts the server (and probably other support staff as GEB points out).

If you have a problem with this policy, leave an extra 2-3% tip (the amount you might have saved by the lower prices), and let the management know that you won't be returning. That's how you influence the owners.

To prevent being inconvenienced in the future, either call ahead to see if they accept credit cards or carry around a debit card or spare cash.

Answer 10

It's actually pretty simple, but everyone conflates two aspects: 1) A company can determine what type of valid payment they accept (within limits). It is up to you to make sure that you have a matching way to pay. Being angry for not being able to pay with credit card is totally on you. Don't be such an angry person, consider to check in advance. There are good reasons to not accept certain card systems, as they often come with additional cost for the business owner.

2) There is no legal tipping lower limit, so the manager demanding you pay a certain amount of tip is unreasonable on his part and yes, pretty insulting. That is, unless they clearly state that a 10% tip is to be added to the bill in general, i.e. it's a general service fee rather than a tip (then he should point that out).

So it seems we have two people who just want it their ways locked horns here.

Answer 11

I used to work at a small but successful deli right off the Main tourist street of a small historic downtown area. The owner did not take credit cards either, but had an ATM about 10 feet from the register. The ATM charged $3 for each transaction. You know damn well everyone knew exactly what he was doing- almost half of the customers would walk up to the register to pay and were then informed of the no credit card policy. Many of them protested, a few got really angry. A few refused to use that ATM and would instead walk 2 blocks down to the BoA to use the free ATM. Now a server always prefers cash tips to credit tips, the latter having to be reported as income, but I guarantee this ATM was not put there to encourage additional cash tips. As I had no metric to determine whether or not one would make more tips if we had accepted cards, I really can't say whether the policy helped or hurt the staff. I would only hope that the customers disdain for an obvious ploy to cheat people out of $3 additional dollars, in a time when taking credit cards was pretty much universally accepted, would not cause them to take it out on the person who served them.

(Granted the tips were a lot lower there than at a fine dining restaurant; a $5 tip would be considered good for a 1-top. At a nice place like where OP went, a $5 tip would be an insult- even more so than simply leaving nothing. Remember the redneck in the movie "Waiting"?)

As a former server, I can only say please, never penalize the server for something they cannot control.

Regarding that place, they likely get less charges in merchant fees when they run cards as debit. They might even have the option to take credit cards, but they just tell people that they cant to save money.

So to answer your question- so long as we have determined that is is NOT the server's fault, I would say the market dictates who is right and who is wrong here. If the majority of the restaurants in that area all accept credit, and this place is the one exception, then its their fault. However if there really is no set standard, and half do take credit and half do not, for example, then its your fault.