Not sure how much to leave your server, particularly in light of the impacts of COVID-19 on the restaurant industry? Keep these guidelines in mind.

By Mia Taylor
April 26, 2021
Credit: Getty Images

As restaurants across the United States gradually reopen or return to full service, there's been a great deal of discussion about tipping etiquette moving forward, particularly considering the challenging economic realities in the industry brought about by the COVID-19 pandemic.

While it's always best to use common sense when tipping, there are some important guidelines and etiquette to keep in mind, as well as new realities to consider as you decide just how much to leave a restaurant server.

For instance, the National Restaurant Association estimates that the industry lost $240 billion in sales in 2020. In addition, a One Fair Wage report published in November revealed that 83 percent of restaurant workers surveyed said their tips have declined since the pandemic began. While none of us are going to single-handedly make up for that shortfall with a particularly generous tip, now is hardly the time to make tipping missteps. Here's some guidance to bear in mind.

Your Tip Is a Big Part of a Server's Income

Unlike many other countries, in the United States, restaurants pay employees just a minimal salary. The federal minimum wage for tipped employees as of January 1 is a mere $2.13 per hour. However, states are legally allowed have their own guidelines with regard to minimum wage for service providers—and many do. 

In some states, servers are paid an hourly wage of somewhere between $2 to $3 per hour, while in others, like California, the hourly pay can be as high as $14 per hour. But California, along with Oregon and Washington, represent a rare exception. In the vast majority of the nation, tips continue to make up a large portion of the server's salary—43 states continue to allow tipped workers to be paid a subminimum wage.

"Tips can constitute over 60 percent of a server’s total earning," according to TableAgent.

General Etiquette and Guidelines for Tipping

In most cases, the standard rule of thumb or etiquette for tipping is to leave 15 percent for service you consider to be "average," according to TableAgent, and 20 percent if the service you received was above average. If you feel the service was outstanding, feel free to leave even more.

"Servers are paid based on a reward system: the person receiving the service can pay the server according to the quality of their performance. The better service the server provides, the more they are tipped," advises TableAgent.

If, on the other hand, the service you experienced was sub-par, you may want to speak with someone of authority at the restaurant, rather then simply decreasing the tip you leave in order to send a message. As TableAgent notes, this approach will not fix the problem.

Tipping in the Era of COVID-19

As the country begins to recover from the COVID-19 pandemic, we're not leaving behind the outdoor style of dining that has become prevalent in many cities and states. And often, this style of dining entails less service.

Still, you may want to continue to be generous when tipping, given the overall tip decrease restaurant workers have experienced this year.

Yet another factor to consider amid the pandemic is that many diners are now opting to order takeout from formerly dine-in-only restaurants. And takeout, as a general rule, does not require tipping. However, here too you may want to consider erring on the side of generosity in order to show your support for the workers fulfilling your meal order under challenging conditions. It's not uncommon at this point to provide a 15 to 20 percent tip, even on take-out, according to the Huffington Post.

Who Benefits From the Tip?

It's also important to remember that in many restaurants, it's not just the server who pockets your tip. It is common practice in many places for the server to share that tip with support staff, including kitchen staff, bartenders, dishwashers, and bussers. More than 14 percent of restaurants that provide full service participate in this practice, which is known as a tipping pool, says TableAgent.

Group Tipping Standards

Though dining out in big groups is less frequent amid the social distancing norms of the pandemic, it's still a good idea to be familiar with group tipping standards that may be implemented by restaurants.

It's not unusual for restaurants, when serving a large group, to add an automatic gratuity. Often this applies to parties of six or more, says TableAgent. In such cases, the gratuity applied by the restaurant may be about 18 percent.

If you are dining with a large party, it's a good idea to ask the restaurant in advance what its policy is.

Calculating Tips Before or After Tax

The general standard is to calculate how much of a tip you'll leave a server based on the cost of the meal, excluding tax. For instance, if the meal itself cost $20 and the tax was $2, you would leave a tip based just on the $20.

However, if you want to be particularly generous, you can use the cost of the total bill, inclusive of tax, to calculate the tip, says TableAgent.

"Servers have to pay tax on their tip as well as share the tip with other support staff members. Many people feel that giving tip after the tax amount is fair, ensuring that their server receives a larger amount," the website explains.

Bottom Line: Tipping Is Not Optional

If there's one point to remember, tipping is part of the overall cost of eating out. It should not be considered optional, unless you've been told in advance by the restaurant that the tip is included.

Workers in the service industry rely on tips to make a living and the best practice is this: If you plan on eating out, also plan on tipping. Period.