Alex N. Press writes about her own experiences as a waitress to illustrate pernicious effect that tipping has in the sub-minimum wage businesses such as restaurants

Overall, 71 percent of women restaurant workers report being sexually harassed at some point during their time working in restaurants, the highest rate of any industry. While much of this harassment comes from customers, 44 percent of respondents say they have been harassed by a supervisor, management, or restaurant owner.
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But the report, coauthored by Catherine MacKinnon and Louise Fitzgerald, shows that it isn’t simply restaurant work in itself that creates the conditions for harassment; reliance on tips compounds the problem. Relying on tips is already a problem for any worker who hopes for even a modicum of predictability in their income, and in matters of harassment, it aggravates the issue.

“Tipped workers were significantly more likely to have been sexually harassed than their non-tipped counterparts,” write the authors, with 76 percent of tipped workers experiencing harassment, compared to 52 percent of non-tipped workers. Further, tipped workers were sexually harassed more frequently in every way measured in the survey — likeliness of being treated in sexist ways; likeliness of being targeted with sexually aggressive and degrading behavior; and likeliness of being coerced or threatened into sexual activity they did not want — than non-tipped workers.

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The way this process plays out is clear. Workers exempted from traditional minimum wage laws depend on tips to survive. This means being dependent on pleasing customers. What follows is as predictable as it is dangerous. Pleasing customers can mean laughing when they make advances on you while you’re in the hallway by the bathroom trying to get a moment of privacy. It can mean your manager telling you to show more cleavage. And it can mean saying nothing when someone harasses or even assaults you.
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As Saru Jayaraman, president of One Fair Wage, said on a press call held on Equal Pay Day to discuss the new report and the Raise the Wage Act, the subminimum wage’s roots go back to the 1850s, to a strike by servers. Restaurant owners responded to the organizing by beginning to replace the male servers with women, whom they paid lower wages, and moving to a more tip-reliant model. Today, some two-thirds of the roughly five million tipped workers in the United States are women, making the subminimum wage “legalized gender inequity in wages,” according to Jayaraman.

Tommy Carden writes there are other categories of people such as the disabled who get paid the subminimum wage who do not get tips.

As of October 2020, the Department of Labor (DOL) reported that over 1,200 employers nationwide take advantage of the 14(c) Subminimum Wage Certificate Program, which allows them to pay disabled employees a wage below the current $7.25 per hour federal minimum. Workers are paid on account of how “productive” they are, oftentimes per piece produced, as Bob Peterson explained. Employment settings that exist due to this program are called “sheltered workshops.” These workshops claim to offer essential jobs and skills training that ostensibly prepare their workers for future “outside” employment in the community at jobs that pay at least the prevailing minimum wage. A recent estimate found that over 100,000 workers across the country work for businesses that can legally pay them subminimum wages under 14(c). 

Under the law, there is no wage floor in sheltered workshops—no dollar or cent amount is too little. So workers can, and often do, earn under $1 a day. Bob Peterson says, “Sometimes it’s pennies, sometimes it’s more. If I was really lucky, it was $24. Most of the time, not even up to a dollar. I could be working my butt off and not even get a dollar.” The conditions in these workshops have led some to ask, “Does the ADA [Americans with Disabilities Act] work?”

I have long argued that tipping is a pernicious practice that we would do well to get rid of and the way to start is by mandating a federal minimum wage that automatically rises with inflation so that we do not have these interminable debates over raising it. I recently learned about a booklet titled The Itching Palm: A Study of the Habit of Tipping in America published in 1916 by William R. Scott that exhaustively examines the practice as it applies in various professions and makes a strong case against tipping.

The object of such an organization should not be to wage war on persons, but on a custom. There is no need for hostility against waiters, barbers, porters and the like as a class. Many of these heartily oppose the custom and will join in a movement to eradicate it. Hence, the campaign should be to readjust the basis of compensation of those who serve the public so that self-respect may be preserved all around. Nothing less than a fair wage as a substitute for the present tipping system of compensation would be considered.

Having made the foregoing point clear at the outset, much resentment among servitors would be eliminated. No one has a desire to deprive a waiter of an adequate compensation, but no one has a desire to give him an excessive compensation through gratuities, or a compensation which depresses his self-respect in the manner of receiving and humiliates the patron in the manner of giving.

Employers would need to be informed, too, that the campaign against tipping is not to throw an unjust burden of operating expense upon them. It will indeed deprive them of any revenues which they should not, economically or ethically, receive from the public through gratuities to employees. The substitution of a wage scale will be attended by economic changes which at first may cause some unsettled conditions, but this is inevitable when an unsound practice has been allowed to grow unrestrained in the business world.

He summarizes the main arguments against the practice.

Summarizing the case against tipping, the following facts stand out prominently:

1. Flunkyism is rampant in the American democracy and this aristocratic influence is undermining republican ideals and institutions.
2. Flunkyism, in the form of tipping, is kept alive by the courts on the plea of “personal liberty.”
3. Tipping nowadays is of precisely the same morality as paying tribute to the Barbary Pirates was in Jefferson’s day, which the American conscience finally abolished.
4. On the economic side, tipping is wrong because it is payment for no service, or double payment for one service; thereby causing the exchange of wealth without a mutual gain.
5. Tipping is ethically wrong because one person accepts payment for a service not rendered, or for a service which the employer already has paid to have performed. And because gratuities destroy self-respect.
6. The hold which tipping has upon the public is due to unscrupulous appeals to generosity, pride and fear of violating conventional social usage.
7. The public is exploited deliberately through books on social propriety which emphasize the custom, or which advise conformity thereto for the sake of peace and comfort.
8. The exploitation of the public is aided by the visualization of the custom in moving pictures and on the stage where it is treated humorously.
9. Employees defend tipping upon the ground that it compensates them for extra services not covered in their wages. An examination of individual instances shows this contention to be false in a vast majority of the number examined.
10. Employers defend the custom on the ground that the public insists upon giving gratuities and they must face competition based upon that condition. But it is shown that employers openly profit by the custom and secretly encourage it.
11. One metropolitan hotel has blazed the way to reform by guaranteeing that its guests will not be annoyed or neglected if tips are not given. This partial step toward the abolition of the custom is possible everywhere if employers are sincere in their profession of antipathy for the custom.
12. Our democratic government permits its officers and employees to accept gratuities, thereby stultifying the spirit of the Declaration of Independence and the Constitution.
13. The conscience of the people as reflected in the laws adopted or offered against tipping is sound and needs only to be led to an adequate expression. There are abundant indications of a widespread distaste for the custom but the sentiment is unorganized and inarticulate.
14. The head of the labor movement in America declares that tipping is undesirable as a system of compensation for employees and destroys the self-respect of those who give or receive the gratuities.
15. A national organization of those interested in this reform should be brought into being with effective state auxiliaries.

Unfortunately, Scott’s booklet seemed to have had no impact.