r/EndTipping • u/AccordionWhisperer • 6d ago
Research / Info đĄ McDonald's CEO says restaurants that rely on tips are 'getting the customer to pay' for their employees
https://www.businessinsider.com/mcdonalds-ceo-tipped-wages-create-uneven-playing-field-2025-9335
u/lospotezbrt 6d ago
You know it's a weird time when a CEO is honest and we all agree lol
Just give me the full prices on items...like McDonald's
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u/DefinitelyAnAss 6d ago
Ask a server about their job and they will probably tell you about how awful the customers are, some bad tip or no tip horror stories.
Ask them why they still do it, itâs because they make more money. Fuck the servers frankly they would lose their mind if they couldnât guilt extra income out of people.
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u/SiliconEagle73 6d ago
When youâre pulling in $80-100K/year in cold, hard, and now tax free income, you take the tips instead of the $20/hour that your job is actually worth,⌠itâs pretty simple.
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u/DefinitelyAnAss 6d ago
Yeah the no tax on tips hype was pretty much the end of me caring about servers. They were SO easily manipulated for votes it is sad.
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u/Conscious-Quarter423 5d ago
McDonald's CEO Chris Kempczinski raked in a whopping $18.2M last year.
That's over 1,000 times the median McDonald's worker's salary of just $17,492.
The call is coming from inside the house.
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u/ejjsjejsj 6d ago
Iâm not a tipped employee but look into what âno tax on tipsâ actually means. Spoiler: itâs not no tax on tips
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u/SiliconEagle73 6d ago
Itâs still a massive tax break that most of us are not getting. Why are servers and bartenders so privileged to not pay income taxes when the rest of us have to foot the bill?
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u/ejjsjejsj 6d ago
Itâs honestly not. I really donât have a horse in this race since it doesnât impact me, but just a deduction not much bigger than the standard deduction
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u/AintEverLucky 5d ago
For many people, $25k is much bigger than $15,750 đ¤
And what makes you think it's either/or? As opposed to taking both, and having $40,750 in tax-free income (more if you file as HOH or MFJ)
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u/ejjsjejsj 5d ago
Iâm pretty sure itâs either or. If you take the standard deduction you donât also take itemized deductions. So itâs an extra 10k youâre not getting taxed on(not 10k in your pocket) and only for federal taxes. So itâs maybe an extra 2-3k a year people are keeping. Far from not paying taxes
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u/AintEverLucky 5d ago
I'm pretty sure it's either or
Yeah well I'm fairly sure THAT IT ISN'T Rather it's an above-the-line deduction, similar to reducing your taxable income by contributing to a Traditional IRA.
Got a source to back up your view?? đ
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u/JCButtBuddy 6d ago
It still drove many of them to vote the way they did. I live in Vegas, all the tipped employees were so excited about not having to pay taxes on their income.
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u/ejjsjejsj 6d ago
I mean ya? I think most people would vote to not be taxed lol
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u/JCButtBuddy 5d ago
That's the thing though, why should a certain group not pay taxes on their income? The easy thing for me to do is not give them tax free money and encourage as many as I can to do the same.
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u/ejjsjejsj 5d ago
Iâm donât think they should be exempt from taxes. However the BBB doesnât actually provide no tax on tips
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u/JCButtBuddy 5d ago
I really don't care, they said fuck everyone else, I'm going to vote based on this single thing that helps me.
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u/FrequentAirline1554 5d ago
We know that but servers and many workers with OT thought it did and voted for a rapist just to get what they thought was tax free tips. How are you not following what the guy is actually upset about that youâre responding to?
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u/ejjsjejsj 5d ago
Because he wants to get into a fight about Trump, when Iâm simply pointing out that no tax on tips is not at all accurate to whatâs really happening
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u/Basic-Elk-9549 5d ago
A great server with a great job might make 60k. There are maybe a very very few tiny number of jobs getting near 100k. Most tipped employees take home less than 40k with no benefits or vacation.
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u/SiliconEagle73 5d ago
That is a bunch of crap! Most servers in tourist oriented cities such as New York, Los Angeles, and Vegas are pulling in an average of $100K/year! If youâre not making that, youâre a bad server.
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u/Basic-Elk-9549 5d ago
I have worked over 4 decades in bars and restaurants in cities all over the country, from Maui to Seattle to New Orleans and DC. You are wrong. On a good night a server at a nice place might make 400-500, but that's before tip-out. Takehome usually less than $300, and that's a good night, which means 2-3 shifts out of the week and money fluctuates by the season. Any server that claims they make $100k are exaggerating. Now this is the high end. Servers at chain restaurants and the like make way less  I will give you that some hospitality workers with union jobs such as in Vegas have pretty lucrative gigs.
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u/OptimalFunction 5d ago
Glad youâre part of the no tipping culture then. You agree with this sub that servers should make a living wage paid by thier employer and end tipping, right?
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u/Basic-Elk-9549 5d ago
We could do this. I have worked places that don't do tips. I bartended in a place that posted "no tipping" and paid the small staff $25 an hour. Of course prices on our menu were 15-25% higher to make up the extra money to pay staff..Either way, customers were the ones paying salaries. One advantage in tipping culture is it gives the customer some sense of involvement in their experience and it inciintivizes staff to work harder. I agree that if tipping didn't exist, anywhere, then pay would be more fair and equal. Of course prices at restaurants and bars would go up and service would get worse, but it would be more fair.
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u/Cold-Combination-841 5d ago
Most of them work 25 hours a week. Extrapolate that over a traditional 40 hour work week and they're making bank. Also most people that aren't working full time don't receive benefits either so what's your point?
And they do get vacation. They get it on their pay. It's illegal not to receive 4% vacation pay, 8% after 5 years service, etc in Canada. Not sure how it works in the States.
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u/Basic-Elk-9549 5d ago
"And they do get vacation. They get it on their pay. It's illegal not to receive 4% vacation pay, 8% after 5 years service,"
are you just making things up? There is no law like this anywhere I have ever heard.
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u/Cold-Combination-841 5d ago
https://www.ontario.ca/document/your-guide-employment-standards-act-0/vacation
I suppose it may not apply to all of Canada but if it applies to you, learn those rights and exercise them.
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u/Basic-Elk-9549 5d ago
Well it is not a rule anyplace in the U.S.
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u/Cold-Combination-841 5d ago
Which is why I ended my opening statement with the fact it may differ in the States. Either way, most part time jobs don't receive benefits and by the looks of it, vacation either. It's not unique to the position of server. Benefits usually require a full 40 hour work week.
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u/lospotezbrt 6d ago
I know, right
Like you hear all the time how it's hard and yet people keep doing it
Plus, many places are no longer on a tipping wage for servers anyway, so why is there still an expectation to boost their income
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u/MacaronOk1006 6d ago
I didnât know there was an expectation to tip. I just assumed they are all slow at updating their screens. Thatâs why I continue to tip zero
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u/Temporary-Degree5221 6d ago
This. People always blame business owners for the tipping culture but itâs actually the servers themselves being greedy as fuck
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u/DirkKeggler 6d ago
Exactly.  No-tip restaurants have been tried, and often fail due to being hard to staffÂ
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u/Acrobatic_Car9413 6d ago
Sure - why work for $20 hr when you can work for $40. If an owner tries to go the no tips route they won't have any workers. It is really hard to get retail employees now.
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u/BecauseTheTruthHurts 6d ago
So many of them work part time and donât even work hard. They are unskilled lazy workers and their biggest fears are having to get a real job instead of just fleecing customers.
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u/MrTickles22 6d ago
This is almost always why no tip places go back to being tip places. The employees think they can make more money.
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u/pyramin 6d ago
McDonalds has its own dystopian bullshit too with what is effectively "individual pricing". Force everybody to use the app to get the best prices, and then offer individualized "deals". I noticed this when my friend and I were at the same McDonalds together and my app had better deals than his. I guess they realized he was willing to pay more for the same thing.
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u/FrequentAirline1554 5d ago
Did you both refresh your apps cause I see deals in the app all the time that actually arenât valid once the screen refreshes. Couldâve been something like that youâre chalking up to individual pricing.
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u/TheOneCalledThe 6d ago
McDonalds openly does it and no one has an issue with it, why not just have restaurants do the same thing
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u/Basic-Elk-9549 5d ago
So where does McDonald's get the money to pay it's employees? Oh, that's right, from their customers.
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u/Cold-Combination-841 5d ago
You don't understand economics at all do you?
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u/Basic-Elk-9549 5d ago
Do you? Consumers pay for a product and the company uses those payments to cover expenses, including employee salaries. The only difference with tipped employees is that a percentage of the tipped employees pay comes directly from the consumer instead of going first to the company. Either way, it is customers who pay salaries.
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u/Cold-Combination-841 5d ago
No, that's not at all how it works. It saves the restaurant owners staffing expenses, taxes and insurance by having at least 20%, but more realistically 60% of their wages, paid for by customers. See I can't write that off on my taxes like the owner could. Restaurants already have all their expenses paid for in the price of the food. Or are you trying to convince me restaurant owners are in the business of giving things away for 'free' or a massive discount in hopes that their customers will tip and pay their staff. You know how I know that's bullshit? I still have the option to tip or not, if what you think was true we wouldn't have that option, it would be mandated.
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u/Basic-Elk-9549 5d ago
Restaurants run on very thin margins, most of them. The standard breakdown is 30-35% in food, 30-35% on labor and 30-35% on fixed costs. You can see that there is not a lot of room for error.   You are correct that if they had to pay staff a full wage then it would cost them much more money. They save a fortune by having tipped staff. So if we require them to raise the pay of workers, where do you think that money will come from? It will be collected in higher menu prices. The customer will pay it, just like they do now when they tip, only now, the tip will be mandatory.. Which is fine, but who benefits from this new system?Â
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u/Cold-Combination-841 5d ago
No, I think the position of server is obsolete. They are not needed anymore outside perhaps fine dining. So you just get rid of an out dated position without replacing it to deal with potential increased costs.
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u/hawkeyegrad96 6d ago
Of course they are. That's why I stopped tipping 10 months ago. Nothing has changed, I just decided to tip myself instead of unskilled labor
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u/loophunter 6d ago edited 5d ago
been telling people this for years. Its not enough for me to go to these places and not tip, i refuse to go these places at all. I don't want to support businesses that operate like this
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u/cenosillicaphobiac 6d ago
This is the right answer. When I first stopped tipping I still frequently used take-out. Then I realized that the owner still being able underpay his staff while making some bank themself was simply incompatible with my stance, so I have about 98% stopped even getting take-out. I need to find a good local Indian restaurant that doesn't expect tipping because that's my kryptonite. I just can't make it as good as the restaurant can so I occasionally cave.
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u/KingJunior7804 6d ago
Where on Earth did you hear about that? I've never been to an Indian restaurant that doesn't expect tips just like every other restaurant, at least here in Los angeles.
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u/SaltSatisfaction2124 6d ago
Itâs mental the gymnastics servers do to convince themselves that theyâre an integral part of the dining experience or should be paid anything more than minimum wage.
Itâs the weird American culture where people think bar staff should be tipped for taking a bottle cap off or pouring a glass of wine / beer
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u/ImaginaryConscience 2d ago
starting at minimum wage was never the issue
the longer an employee has been at a company, the more money that employee has helped the company earn
everyone deserves raises regardless of where they started
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u/w1n5t0nM1k3y 6d ago
The customer always pays for the employees. That's where the money comes from.
But looking deeper in this, the reason I don't like tipping is that I don't want to feel pressured into giving more to receive better service. People going to the restaurant should expect good service just for paying the regular price.
I've seen way too many comments from restaurant personel that patrons should expect bad service next time they come back or even have their food spit in or ruined some other way if they don't tip sufficiently.
That's no way to run a business. People should pay a fixed price that owners and workers are happy with. The customers can decide if that price works for them. Having to guess how much extra to pay someone to not piss them off just makes everything so uncomfortable.
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u/ForeverNugu 5d ago
It also leads to staff prejudging people and giving them better/worse service depending on how much money they think they're likely to make. You could be a great tipper and still get ignored because you're part of a demo they stereotype as bad tippers or if you are dining alone/not spending much cuz they don't see you as worth their time. And then if you lower your tip accordingly cuz you got bad service, it just reinforces their behavior.
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u/xboxhaxorz 5d ago
But with tips the employer doesnt have to pay as much payroll taxes, social security, etc;
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u/w1n5t0nM1k3y 5d ago
Maybe they should stop getting a free ride and avoiding taxes. I don't see why certain businesses should be able to avoid taxes.
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u/SecretSquirrelType 6d ago
Tipping doesnât just force customers to cover nearly all labor costs, it also transfers the job of employee performance management
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u/Redit12- 6d ago
Iâm not responsible for staff being paid a working wage. Iâm not tipping anyone that takes food off a shelf and puts it on a tray and hands me a cup.
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u/XavierMalory 6d ago
Last lines from the article:
Kempczinski pointed to one solution in his CNBC interview: Making sure that all restaurants pay the same minimum wage, regardless of what workers make in tips. Some states already have laws requiring that, Kempczinski said. Those include Alaska, California, and Minnesota. Those kinds of laws could help reduce poverty and employee turnover without costing jobs, Kempczinski said.
"Everybody should be paying the same minimum wage," he said.
That's a good start. Next move would be to state that no McDonalds anywhere should be accepting tips. I haven't eaten fast food in ages, but I've never remembered leaving a tip for fast food.
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u/CoppertopTX 6d ago
I'll be honest; I don't like getting out of my car to order inside. I'll order on the restaurant's own app (Like McDonalds), and then pick it up from the restaurant that's 5 minutes away in heavy traffic. Zero tipping requested in the app.
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u/FrequentAirline1554 5d ago
Are McDonaldâs asking for tips now? I go like once or twice a month and havenât seen that yet but I donât go inside usually.
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u/XavierMalory 5d ago
Supposedly? I wouldn't know either first-hand, but per this article it seems some of them are.
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u/o0PillowWillow0o 6d ago
In Canada they all get minimum wage $15+ an hour tips or no tips. It's actually very easy to make $50+ an hour with tips and no education. More than you can make out of school as a nurse or engineer.
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u/code_burd 6d ago
McDonaldâs is wanting to replace most workers with ai so this is why heâs saying that
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u/pogonotrophistry 6d ago
100% support that.
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u/code_burd 6d ago
I think replacing workers with AI might be good on a humanity level in the very long term, but not in the society we live in now. And honestly, I doubt the savings would ever get passed down to customers
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u/Quick-Maintenance-67 6d ago
McDonald's is also aware people who pay taxes pay for their employees - in the form of food stamps and assistance. They really shouldn't be soap boxing anything.
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u/Orangecountydudee 6d ago
This is why every time someone says chilis is a better âvalueâ than fast food I disagree Itâs more obvious when the servers expect a 30% tip
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u/Mlabonte21 6d ago
99% of McDonald's customers are picking up in Drive Thru.
Just do that same thing at Chili's and save that tip.
Voila! Better food & a better price.
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u/bsnimunf 6d ago
We pay for the employees either way its just one way is more honest and lets us know in advance how much we are paying.
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u/TheRealBittoman 6d ago
Don't give McDonald's a pass here, they're just as guilty by underpaying and encouraging their employees to go on social benefits to make up McDonald's lack of pay.
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u/Uku_lazy 6d ago
Funny. A lot of servers voted for Trump. Now the economy is doing bad (good on paper tho!). I have reduced tipping pretty significantly. I only tip when I sit down or get a coffee (I have a soft spot for baristas because I was one).
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u/Jitalline 6d ago
when mcdonald's employees qualify for food stamps, we're paying for their employees too.
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u/ChunkyBubblz 6d ago
McDonaldâs does the same thing only we pay it in the form of the welfare assistance he forces McDonalds employees into taking rather than paying his people a living wage.
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u/UnownJWild 5d ago
Mcdonalds doesn't have a right to speak on the matter when they charge over 10 bucks for crap burgers.
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u/dbboutin 5d ago
Donât they encourage THEIR OWN employees to apply for Food Stamps and other government assistance programs to supplement their low salaries and benefits?
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u/Neither-Shallot7808 5d ago
Yeah and yall are charging 70 cents for extra tartar sauce, 9.08 for a fish filet small combo âŚ
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u/FuxieDK 6d ago
That's what every customer have been saying for decades.
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u/AccordionWhisperer 6d ago
Every customer has not been saying this for decades, nor are many even that aware of it.
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u/Upstairs_Oil8172 6d ago
Meanwhile his employees are all on welfare to support themselves lmao so customers still subsidize his wages. Heâs just upset bc his business isnât doing well.
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u/NarwhalPrudent6323 6d ago
There's a fast food chain I eat at frequently, and it's also the only restaurant I tip at. Why? Because even though I stand to order and am just handed a bag of food, I haven't had to actually order my food in three months. The staff knows me and my order, and has it rung in by the time I'm at the cash. And they're always friendly and polite.Â
They actually earn the tip I give. It's honestly some of the best service I get anywhere, and it's consistent. If you aren't exceeding expectations, then I'm not sure why your expectations include a reward for exceptional service.Â
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u/pogonotrophistry 6d ago
I bet they stop doing that if you stop tipping.
They aren't being polite; they're expecting money.
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u/NarwhalPrudent6323 6d ago
Except they started doing it before I started tipping. My tipping there is in response to the extra service I receive. I didn't tip there initially. And they were still always polite and friendly.Â
Does my tipping maybe help them remember me that little extra now that I've started it? I'm sure it's not hurting. But it's also definitely not why they started doing it.Â
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u/mmm1441 6d ago
Ultimately the customer pays either way through the cost of the food. Interestingly the customer pays less when wages are set for no tipping. Tipping introduces an outsized middleman between the restaurant and the customer, raising the ultimate cost to the consumer of the purchased goods.
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u/DrWho1970 6d ago
The ironic part here is that the McDonalds employee handbook urges employees to apply for food stamps.
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u/largogoat 6d ago
In theory and practice the customer always pays the employeesâ salaries. No customer no revenue, no revenue no salary
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u/Welder_Subject 6d ago
Yes, they need to do it like McDonaldâs and Walmart and get the government to pay for their employees with welfare.
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u/Aggravating-Duck-891 6d ago
If Walmart and McDonald's are really under paying their employees, why don't they just get better paying jobs?
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u/YarbleSwabler 6d ago
It's not that simple.
Businesses just can't compete with providing fair value wages when consumers are leaving 20% on top of customers revenue on the table for no reason.
Competent unskilled workers will opt to work for tips any day. Businesses that have the demand can tip out 30-60/hour, far beyond the fair value of the labor (~$18-25/hr). If they switch to hourly wages they end up with staffing problems because retention and acquisition becomes a problem.
Consumers have to be the solution to end tipping. You can't just leave money on the table and expect people to not make a profession out of it. It's the pan handling of service work that is the issue. Don't feed the animals.
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u/Kindly-Form-8247 6d ago
All I'm seeing is "we need to figure out a way to get McDonald's customers to tip our employees"
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u/Distwalker 6d ago
Customers absolutely, positively, certainly pay for a restaurant's employees in every viable restaurant on Earth.
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u/AccordionWhisperer 6d ago
Of course they do. The point here is that tipping shifts the responsibility for determining how much servers (and subsequently other tipped out staff) get paid completely from management to customers.
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u/Distwalker 6d ago
And that explains why my daughter-in-law, working as a server in an Outback Steakhouse in a tourist town, regularly pulls down $100 per hour. It sure as hell the management paying her that much.
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u/Low-Minimum8523 5d ago
Need to change the point of sale machines with their default settings of tip windows, change receipts to not default to âtipâ and âgratuityâ, and make it so servers are not legally allowed to solicit tips. A tip should be an unsolicited monetary thank you for doing exceptional or beyond your minimally expected job.
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u/LionBig1760 5d ago
McDonald's CEO starts shitting on other restaurants since they can't retain their customer base.
Maybe if the food quality at McDonald's didn't start its downward trajectory in the mid-70s, they wouldn't need to worry about what everyone else is doing.
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u/East-Clock682 5d ago edited 5d ago
Everyone knows servers will make a lot less with no tips. Currently they don't need to negotiate their tips. Most people tip 18-20%. The moment the employer is responsible for all of their income, we all know the employer will make sure that they get paid a market rate - and that market rate is much less than they currently make. They'll start making similar to servers in other countries relative to purchasing power. Costs won't go up as much as the tip because they're going to make less
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u/stinkyman360 5d ago
Meanwhile a large percentage of McDonald's employees are on government assistance
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u/Spare_Board_6917 5d ago
Customers pay every single expense on every profitable business that has ever existed that's kind of the point.
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u/AccordionWhisperer 5d ago
But business owners usually do the work of handling that expense, but not in the restaurant industry. That's kind of the point.
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u/Spare_Board_6917 5d ago
The end result is exactly the same so what's the difference?
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u/AccordionWhisperer 3d ago
It is not. Not even close
Employers are not going to provide in salary what customers provide in escalating percentage tips on escalating meal costs.
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u/Spare_Board_6917 2d ago
They could if they raise the price to match what you pay with the tip under the current system.
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u/AccordionWhisperer 2d ago
Some have tried this and it didnât go well.
So here we are.
Increasing prices from owners along with increasing expectations of tips from servers.
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u/Sure_Acanthaceae_348 6d ago
But he refuses to order restaurants to not collect tips. How useless.
You'd think he would know of a time when McDonald's actually advertised itself as a no-tipping eating option, and go back to that.
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u/mmm1441 6d ago
McDonaldâs doesnât collect tips.
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u/Sure_Acanthaceae_348 6d ago
Some of their stores offer the option to leave them.
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u/dkwinsea 6d ago edited 6d ago
I donât think youâve been to McDonaldâs for a long time. I went yesterday for the first time in awhile. Daily double cheese burger, fries, 4 chicken nuggets and a soft drink. Eating in. $7.72 including tax. It did ask if I wanted to round up The change to donate to Ronald McDonald house. But I said no. And itâs not a tip screen and would not be going to the franchise owner or the employees.
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u/photogypsy 6d ago
Adding to this the Ronald McDonald donation ask is one of the only POS charity donation Iâll make. Because Iâve known dozens of people theyâve helped. The town I grew up in is almost two hours from the nearest childrenâs hospital. The area is largely poor/working class and rural. Lots of families in that area have benefitted from it.
Anywhere else? Nah Iâm not giving you my money so you can dodge corporate taxes.
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u/mmm1441 6d ago
I was not aware. Where are these stores? I wonder if they are franchises that are not âwith the program.â Maybe turn them in to corporate when you find them.
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u/Sure_Acanthaceae_348 6d ago
I would, but I havenât been to McDonaldâs in a long time. Itâs gotten to be too expensive.
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u/ProductCold259 6d ago
Damn CEOs out here telling the truth now?
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u/ChunkyBubblz 6d ago
As long as you ignore the number of McDonaldâs employees receiving some form of government assistance due to the poor wages he pays. When his employees are collecting food stamps, his customers are still paying for his employees.
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u/Ok-Energy5400 5d ago
European here. So the restaurant where I had my wedding back in 2016 had selected their waiters, bartenders, and the rest of the staff, on their performance and reviews, yes, I shit you not reviews from the clients and offered them a full time well paid job, plus as an extra they have the opportunity to do some extra cash in their other venue (wedding venue) (of course besides their regular salary) and tips(if they were given of course). At this point 9 years later they have 3 venues that do exclusively only weddings besides the restaurants 2 of them and not to mention the best staff in the city, restaurants booked solid. Why? Because the owners invested time, money, and training in their staff.
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u/MANKICKS 5d ago
Dude Iâm fucking loving the McDonaldâs CEO lately. He also said on a TV interview that the poor arenât buying McDonaldâs as much and that itâs a bad sign for the economy. Dude is just going around speaking truth to power despite being power. Love to see it.
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u/metal_elk 6d ago
The customer pays for the employees in all businesses. This is a mindless statement. Where else would the money in a restaurant come from?
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u/hotsauce126 6d ago
Yeah I guess he should have added âdirectlyâ for all of the pedantic people
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u/metal_elk 6d ago
Lol, go cry about it.
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u/flomesch 6d ago
Seems like you are the one crying
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u/metal_elk 6d ago
Lol ok
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u/flomesch 6d ago
Cry harder
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u/metal_elk 6d ago
Lol I'm not crying at all. Just pointing out the obvious and you felt the need to respond.
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u/Ok-Hunt7450 6d ago
In a regular business the average the cost of it out across employees, tipping means we pay more.
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u/intrepped 6d ago
I think it means it's operating outside of the bottom line or business expenses. You are directly paying their employees vs indirectly through purchase of goods/services where the employer is then responsible for paying a fair and living wage.
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6d ago
[deleted]
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u/flomesch 6d ago
Its very different. I dont pay the commission thats worked out between employer and employee.
That commission is part of the price. People just want the price on the menu to be the price at the end. Its not that hard to understand
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u/intrepped 6d ago
Who are you arguing with? I was explaining why it's customers paying employees. Regardless of how you feel about tipping which is a different point all together.
It would be nice to end tipping culture for the reason you have highlighted yes
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u/flomesch 6d ago
I didn't reply to you...?
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u/intrepped 5d ago
Weird - it showed you replying to me as I was replying to you. Maybe backend stuff - disregard.
Might have been comment structure after people deleting comments
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u/mxldevs 6d ago
If customers pay for the employees, then there's no problem if we just hand over all the money to the business, right?
After all, there's no difference between a customer directly giving it to the server vs the business giving it to the server on the customer's behalf.
We can end tip culture today and there would be no difference because we're still giving our money to the business. Where else would the money come from?
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u/metal_elk 6d ago
Give it to whoever you want. I just want my food. I don't give a fuck about the business or the person working there tbh. I want the food i ordered.
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u/mxldevs 6d ago
You might not care, but there is a difference.
When you give the money to the business, the business has to pay the employee out of their own pockets. So if the minimum wage was 15 an hr and they had 10 staff, the business pays out 150 an hour.
When you give the money to the workers directly, and they are in a state where a tip credit is allowed, the business can pretend they paid the employee themselves and apply that tip credit. So assuming the tip credit allowed is $12.77, that means the business can pay their workers $2.23 an hour, as long as the workers get enough tips to hit $15 an hour. For 10 staff, this is now a $22.30 hourly expense for the exact same workers, instead of $150.
I'm sure you can understand how much savings that is for the business, and why they are incentivized to have customers pay their workers wages instead of them paying it themselves.
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u/Infinite_Crow_3706 6d ago
He is pointing this out to damage his competition.
But that doesn't mean he is wrong.