The Jordan Harbinger Show - 668: Tipping | Skeptical Sunday

Episode Date: May 15, 2022

Tipping isn't a city in China. But it is a shameful institution that encourages racism, sexism, harassment, and exploitation of low-income workers while placing the burden of compensation on customers instead of business owners. If most restaurants and service-based industries in the world can exist without relying on tipping, why does the custom persist in the United States, and what would be a fairer, more sustainable alternative? Welcome to Skeptical Sunday, a special edition of The Jordan Harbinger Show where Jordan and fact-checker, comedian, and podcast host David C. Smalley break down a topic that you may have never thought about, open things up, and debunk common misconceptions. Full show notes and resources can be found here: jordanharbinger.com/668 On This Week's Skeptical Sunday, We Discuss: The federal minimum wage for tipped workers is $2.13 per hour -- the same as it was 31 years ago (though it can be even less in some states under certain circumstances). Why is it the customer’s responsibility to pay these workers a fair wage? Why, contrary to the protests of whoever happens to be holding the purse strings, raising the minimum wage for the person serving you will not make your burger cost $25. How tipped workers are still expected to fulfill untipped tasks during their "down" time, but without a raise in compensation to make up for it. Why the institution of tipping encourages racism, sexism, harassment, and exploitation of low-income workers. How the custom of tipping came about, why it persists in places like the United States, and what we should be doing to replace it with something that would better serve the server and served, alike. Connect with Jordan on Twitter, on Instagram, and on YouTube. If you have something you'd like us to tackle here on Skeptical Sunday, drop Jordan a line at [e-mail] and let him know! Connect with David at his website, on Twitter, on Instagram, on TikTok, and on YouTube, and make sure to check out The David C. Smalley Podcast here or wherever you enjoy listening to fine podcasts! If you like to get out of your house and catch live comedy, keep an eye on David's tour dates here and text David directly at [phone] for tickets when he comes to your town! Sign up for See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

This episode is sponsored in part by Conspiruality Podcast. You know how I'm always talking about critical thinking and spotting manipulation? Well, there's a podcast that's all about dismantling new age cults, wellness grifters, and conspiracy mad yogis, basically the wild overlap of spirituality and misinformation. It's called the Conspiruality Podcast. The hosts, a journalist, cult researcher, and a philosophical skeptic, dive deep into how this stuff spreads, from Project 2025 and the Heritage Foundation's dystopian vision of the future to how former leftists get pulled into far-right conspiracies.

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Find Conspirality on Apple Podcasts, Spotify, and wherever you do. get your podcasts. Welcome to the show. I'm Jordan Harbinger, and this is Skeptical Sunday, a special edition of the Jordan Harbinger show where fact checker and comedian David C. Smalley and I break down a topic that you may have never thought about, open things up, and debunk common misconceptions. Topics such as why the Olympics are kind of a sham, chemtrails, why toothpaste might actually be really bad for you, and lots more. Normally on the Jordan Harbinger show, we decode the stories, secrets and skills are the world's most fascinating people and turn their wisdom into practical advice that you can use to impact your own life and those around you.

We have long-form interviews and conversations with a variety of incredible people, from spies to CEOs, athletes to authors, thinkers, and performers. And if you are new to the show or you want to tell your friends about it, I always recommend our episode starter packs. These are collections of our favorite episodes organized by topic. It'll help new listeners get a taste of everything that we do here on the show. Topics like disinformation and cyber warfare, China and North Korea. technology and futurism, scams and conspiracy debunks just like this one, investing in financial

crimes, and more. Just visit jordanharbinger.com slash start or take a look in your Spotify app to get started. Today on this edition of Skeptical Sunday, tipping. Tipping is one of the worst things to happen to the American economy, and it may sound shocking, but statistics show that tipping actually encourages racism, sexism, harassment, and exploitation of low-income workers, and it's the perfect crime because it pits worker versus worker. It relies on empathy and our freaking good moods, which some of us, you know, those are few and far between, and removes the burden from corporations

to pay something even remotely close to resembling a fair wage. Now, I'm not advocating not to tip. I just think we need to discuss what's really going on and how we've all been duped into participating in this nonsense. During the pandemic, one of the things I saw on Reddit that drove me crazy was people mistreating like these hourly workers and servers and you just see some of your favorite restaurants going out of business. So I decided to be, hopefully what a lot of people did is made the same choice,

but decided to be like not a dick about everything and also to up my tipping game big time. So instead of choosing the lowest tip in an app, I might choose that but then give cash additionally when the person comes by or just choose the highest one and not worry about it. As long as I know the app isn't like stealing the tips. Remember that whole debacle? Oh yeah. I tried that as well. I think a lot of people did and I really think the tipped workers appreciated.

it for the most part. I hope so. It was hard. We all had to stick together during that time, you know. That's what I'm saying. And so I started to see just how grateful some folks were when I started to tip a lot more, like, not just 15% or not like bumping it to 20, but being like, you know what, here's like a solid amount of money that you can actually do something with. And a lot of people were really so appreciative that I was kind of like, holy crap. It's almost making me feel bad that I tipped low before, or normal, I should say, before. because if you're this happy about, let's say, 20 bucks on a $50 meal, you needed it. You need it more than I thought you did.

And so I started thinking more and more about tipping, and I just started to realize how kind of unfair the whole system of tipping really is and how, frankly, confusing it is when I try to explain it to people from other countries. They're just like, wait, nothing of what you've told me makes any sense. Start from the beginning. And I can't make it make sense, David. You can't make it make sense. There are people who live this who are a tipped worker in Minnesota. They can't make it make sense to a tipped worker in California or in Texas. The laws are so incredibly spread out. I have some information on that for you that we can get into in a moment, but it's confusing across the board because there are very few federal minimum requirements on tipping and minimum wages, and the rest are all up to the states. You may live in a place and then move down the street and your zip code may have different laws because of city ordinances.

So it's kind of all over the place. But how did we even get there? Because when I go to other countries, nobody, if you tip, it's like 50 cents because you're rounding up on a dollar. Or it's one of those like Middle Eastern economies where everything is kind of a tip and like to even get something where you would never tip. You got to bribe somebody. I mean, tip somebody and like slash bribe somebody. So how did the United States end up with this weird tipping culture that just doesn't seem to be anywhere else? Yeah.

So tipping at one time was considered like a bribe. of rich people to like skip the line or get better treatment than the poor people around them. So it was kind of frowned upon for most of, most of our history. But then in America, tipping a recently freed slave right after the Civil War allowed bars and restaurants to employ former slaves without actually having to pay them because the people could pay them. And so they had money. Technically, they were getting paid.

And there was no federal law on it. So that's where it kind of started. And that's why in a weird way, and this sounds like. a false flag or like a the sky is falling type situation. But stick with me for this. Yeah. Tipping actually encourages like racism and sexism, sexual harassment, exploitation of low income workers, and it's the perfect crime.

It sounds like they decided, hey, we can also still have slavery. We just have to call it tipping. And it's like, well, wait a minute. There's a lot of people who work for tips. And if this is built on, well, we don't really want to pay these people. We can just let other people pay these people, but only if they want to. it's like, well, that's, we're not too far from the original intent of what this was designed for. You're exactly right. There's no, there's no curiosity as to why it started right after slavery

ended, which is the same thing for the high incarceration rates of the African American community. It's the same issue. These things spiked right after the Civil War because they were trying to grab on to what little bits they had left of keeping certain people in certain classes. And the reason it started to spread out to more people is during prohibition. When prohibition hit, then they were like, hey, this has been working for all the former slaves. Why don't we do this with everybody who works here? Because we can't sell this and we can't sell that, so I can't pay as much. But hey, look, if you're willing to work for tips, I don't have to fire you.

That's kind of where all of this started. It's so insidious, right? Because it pits workers against each other and you read stories about that in the news. And it also relies on empathy. And like I said, my empathy spiked a bunch. because I saw people just being so horribly mistreated in videos on the internet, and you'd hear stories from friends of yours that work in the service industry, and they're like, oh, I had the worst customer. And it's not just like, he was rude. It's like, they threw something at me or, like,

grabbed my butt on the way back from the table, and I have to be nice of them because of tips. And I'm like, this is just, it's so messed up. And not to mention, it removes the burden from a business to actually just pay for the workers. Right. Which you can't get it. with anywhere else. It's literally illegal in every other instance to do that. Look, tipping is literally one of the worst things to happen to the American economy, period. Yeah, I could see that. I'm going to be very clear. I'm not advocating for people not to tip. We're in a situation right now in this country where people need it. They literally need those tips to live, but we do need to discuss what's really going on with the tips and how we've all been duped into participating into this madness.

And you're exactly right. When you say it tips employee versus employee and it also relies on that empathy. So even though it's not the right thing to do in the broad spectrum, when you are at your table and your server is there, you feel that need to tip. And these corporations really thrive on that. So this change needs to happen at a higher level. There's an episode, I don't know if you remember that Adam ruins everything. Yeah, I know Adam. Yeah, it's funny. I was just talking with him and I told him, I'm going to shamelessly bite some of your show and do Jordan ruins everything, except I'm going to find a different name for it. And he's like, go for it. So we have the blessing here.

Awesome. Yeah. So that's cool that you know him. He actually did an episode. It's a very short episode, just a couple of minutes long on YouTube, on Adam Ruins tipping. He says in that episode, I have a quote here from me, says, why don't restaurants just pay a fair wage and charge more for the food? That's what other businesses do. When you buy a pair of jeans, it's just $50. It's not $40 and you decide if the stock boy eats tonight. That's the mind-blowing piece of this, is this is the only sort of area where the employer, gets to have that employee do what they want, but it's up to the customer to pay that employee a fair wage.

Right. It's incredible. I don't get paid less when I release a stinker of a show. And that happens even with this glorious team that I have, some things slip through the cracks, right? And it's always my fault, and I'll take the hit on that one.

But I don't get less money for that. Right. Right. And if the CEO of any company has a bad performance day, their pay isn't cut, of course, you know, they're paid annually based on performance of the company, et cetera. So maybe that's not a great example.

But managers, for example, are rarely paid at least daily, weekly, monthly on performance. You know, they can lose their job. Sure, we're at a free market here. But it's less fluid than, well, not that many people came in. And the ones that did were cheap bastards who didn't want a tip. So you don't get to pay your rent. Yep. Yeah.

You have a bad day or you're sad or you make mistakes. I'm the same way. I put out a bad show, a bad episode of my podcaster. I go on stage, you know, Dave Chappelle has a great line in one of his stand-up shows where he talks about getting booed after, you know, at a theater. He's got like 6,000 people that are booing him because he went on stage incredibly high. And he's like, I'm like evil-conneval. I get paid for the attempt, you know.

And that's a good thing because, you know, crowds are different. And sometimes you have an off-night. You know, I'm a traveling touring comedian. Sometimes I just have an off-night and I don't do very well. And it's a good thing they don't say, we're cutting your pay in half because you weren't as funny as you were last time you were here. You know, but these tip workers, you know, if they have a bad day or they're having a bad moment or sometimes they get a phone call or a text message that's upsetting, their boyfriend is

leaving them or their child is in the hospital or whatever, they get distracted with real life. And now they get an instant pay cut because that person at the table is going, you didn't bring my water fast enough. My chips were not, you know, hot. It's such a demeaning thing to people that are working very hard. And it goes beyond that. We're talking, 1938 was the first federal minimum.

minimum wage, and even in the first federal minimum wage, tipped workers were paid less. In 1991, they raised that to $2.13 an hour, and here we are 31 years later, and it's still exactly the same. That's the federal minimum wage for tipped workers. $2.13 an hour. How incredibly insane is that? That doesn't, I mean, at that point, just don't give me anything, because who cares? So if I'm a server at a restaurant and it's empty because, there's construction and people can't get to our location easily. I'm making $2.13 an hour before tax. You are. Now, there's some interesting pieces to this because the federal minimum wage is $7.25 an hour. The tipped worker makes $2.13 an hour, but as I said in the beginning, it's very confusing.

And there are people that are listening to this who are tipped workers going, that's not true. And they start spouting off their own state laws or their own regional laws. And they're probably right. It's so all over the place that it's hard to keep up with. Federal minimum is 213, but there's a thing called a tip credit that's allowed in most states that basically allows the 213 to be the minimum as long as your tips equal a minimum of the remainder, which would be 512 an hour, to meet the 725 an hour minimum. So basically they're saying they only have to pay the 213 as long as the tips equal the minimum 725.

I see. And if your 213 plus your tips don't equal 725 an hour, the employer is required on the federal level to make up that difference. The problem is, do you live in one of the regions of New York that have a higher minimum wage or a lower minimum wage, or there's a provision in Oklahoma that says you can pay $2 an hour, and yes, the federal minimum does allow for exceptions to the rule, you can pay $2 an hour if you have less than 10 full-time employees and full-time being a minimum of 30 hours a week? you're talking about a company who could have nine employees, pay them all $2 an hour, and if those employees are under 20 years old and have worked for you for less than 90 days,

you can go even below the federal minimums. So it's just, again, it's all over the place. And you're talking about, in New York, it could change by zip code, it could change by region. Some states, if you have under 10 or 20 employees, it can be different. Some states have $10 an hour minimum, and tipped workers are part of that. California is one of the best. states to be a server because you're going to get the state minimum wage, which is $15 an hour right now, plus your tips, and there is no tip credit allowed. There's also no tip pooling allowed, which is another piece of this. But yeah, you could be at work making that amount, and if you get to the point where you finally hit minimum wage that week with your tips and the $2.13 an hour,

you think, all right, now I'm going to start raking in actual money on top of my minimum wage. your employer can go, you need to go roll the silverware. You need to go take out trash. You need to mop. You need to clean the bathrooms, things that you're not going to make tips in. And so it's a way for the employer to sort of control the whole influx outflux of money. And it's shockingly exploitative. The exploitation is shocking. The non-tip duties sound almost like a punishment, right? Rolling silverware, taking out the trash, mopping, cleaning the bathroom. I get that those things have to be done. but if you are not making any money doing it or they're almost saying,

well, hey, I want to give the table to this person, you don't get it. I mean, it just seems like there's such a easy way to make your job miserable and unfair and not pay you anything and essentially force you to have to leave. So they only have to pay more if you make less tips, right?

Fine, but then you're just getting a minimum wage job, but maybe you signed up because you were going to totally make $25 an hour in tips at this place because everyone else does and they're like, nah, you're going to mop, in clean bathrooms and you're going to make 725. And you don't have any choice.

It becomes strategy for the general manager or for that shift leader, right? So if you only have to pay more when that person makes less tips, as soon as someone makes their minimum in tips, you can pull them off the floor and make them do other stuff and put the person who hasn't met their minimums yet on the big table so that they get tips enough to cover that minimum wage to keep your labor hours low. Do you see what I'm saying? Yeah.

Instead of taking the person who's not really a great server, who probably should be doing the trash and the, in the restrooms so that you provide a better service and that person makes more money. You go, well, you've hit your minimum so we're going to move you to this area. I had this happen to me and I wasn't even a tipped worker. I had minimum wage plus commissions in a sales job one time and I did this huge deal. I mean, I was like 21 or 22 years old and this huge deal came out to like $4,800 in commission for me. Well, at the time, that was like a month and a half worth of my wages. And so I was like, my mind was blown. I was like, oh man, I'm

finally going to get caught up on all the things I'm behind on, my employer handed me my check and laid me off for six weeks. Oh my gosh. Yeah, it wasn't really enough time to have to go. They literally gave me my end date and my new start date and said, if you find another job, good luck, but we don't need you back until this date. So that money ended up being just like I was getting paid for six weeks. Right. So you got a paid vacation that you didn't want. Exactly. Yeah, exactly. I didn't get to catch up on all the stuff I was behind on. So in this way, especially with the server For example, it sounds like you can actually, tipping can actually make service worse because it causes the business theoretically to make the worst lowest-tipped servers do the most tables so that the

business doesn't have to pay so that they can make up for the tips and the best servers end up doing something else that doesn't end up getting them tipped. And of course, then they hopefully quit. But as we know, the sort of myth of being able to switch and go to a different job on a moment's notice has been largely a myth. Right now, it's a really good time to switch job. but for most people during most of the years that we've been a, I don't know, a country, it's really been harder to do that. You just hit the nail on the head, Jordan. That's exactly it.

And service suffers as a result. Good workers suffer as a result. Workers who aren't as good end up getting paid and get tips they probably shouldn't have gotten. And then you end up in situations where you have to do tip pooling. Right. I was going to say, don't they try to solve that by just making everyone share tips, which also sucks? They tried to, for many years it was legal to just do tip-pooling, where basically everything you got tipped went to the restaurant, and the restaurant decided what was going to be distributed to the certain staff. Oh, man.

Well, typically you have back-of-house people, right, who are the kitchen staff. Those people tend to make more than the servers. They're not making $2.13 an hour because they're not considered a tipped worker. So they're coming in at $15, $17, $19 an hour in the back making the food. And then you have the servers running the food at $2.13 an hour. and those tips come in, but then everybody shares in the tips. So if you're a back-of-house worker or you're just running food as just someone doing, you know, the actual food delivery, or you're in the back doing the dishes, making $10, $12 an hour,

you're still going to get tipped out at the end of the night in a lot of places. And supervisors, managers, and owners were taking a cut of the tips. Owners that weren't even at work that day would come in at the end of the shift, take a portion of the tips, split it among everybody and leave. So they were taking a part of the tips as the owner. The Obama administration came in and said, no more. You're not going to do that. That's illegal.

You're not going to allow tip pooling. So during the Obama administration, that was illegal. The Trump administration rolled back that ban on tip pooling, but added a few provisions. So now you can redo tip pooling, but you just can't include supervisors, managers, or owners. So Trump now has allowed it for it to be tip pooled with back of house, with cooks, dishwashers, things like that. So you still end up tip pooling in some areas. As far as I know, California doesn't allow it. I think California doesn't allow the tip pooling, pays minimum wage, and is probably the best place in the world to be a server, which is why half the people you see

on television are waiting tables, because the money's not too bad out of here. Sure. You just can't afford to live anywhere in California. Exactly. You just need seven roommates. You have seven roommates. I was going to say, yeah, you have seven roommates and you're probably snuggling up in one bed. But get this, and I don't know if you noticed this during the, during our pandemic here, but some places started to add a fee to the checks. I saw that, but I thought that happened before. It was like, health care stuff. And I'm like, why am I paying benefits to your workers?

Not that, you know, I'd rather they have benefits, but I'd rather you pay for them, restaurants. It's because the tip pooling was no longer allowed. I see. So now if you add a 20% fee to the check, that's a charge for the restaurant. And then they can decide what to do with that money. So it's essentially a loophole to get around tip pooling. So now if you have to pay a 20% fee, a lot of people will see that fee and go, oh, gratuity's included, and they won't tip.

Oh, man. So now that person's not getting the check. They think the 20% fee, service fee, is actually a tip, a forced tip, so they don't tip. And then the restaurant gets that money and goes right back into the pre-Obama times of getting to do whatever the hell they want with the tips, including keeping all or a portion of it. Ah, and I've got a tip for you. How about you support one of the sponsors that makes this show possible? We'll be right back.

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And look, I understand. I'm sympathetic to this argument. If we pay everybody this crazy higher amount, a burger is going to be $25. Now, that's an exaggeration, except here in California, where it already is $25, depending on where you're eating.

Yeah, I was going to say. Won't prices also go way up? I mean, that's what a lot of folks are worried about. I won't be able to go out to be able to afford going out to eat. I don't know if you've been to the UK or anything like that, But if you go to friggin' pizza hut and you want to have a pizza with two of your buddies, it's like 60 bucks or sometimes even more. If you want to feed your family, you can pay like hundreds of dollars to go get mediocre food somewhere in London.

Yeah, well, that's probably also because of the dollar versus the pound, right? I think there's a little bit of difference. Yeah, but you know what I'm saying? Like, eating out in Europe is extremely expensive, and I think people are trying to avoid that same thing happening here in the United States. So there's a place called Dick's Drive-in in Seattle that has completely squashed that myth. They pay $19 an hour. There is no tipping, and their cheapest cheeseburgers, a $1.90. Their most expensive cheeseburgers around $5. So, no, I don't buy that. I think that, and this is a little bit

of an interesting piece, is going to sound very socialism, I think, to the listeners. That's all right. You're a communist. David's a communist. We really can't get a hold on this until we put some kind of limit on how much more a CEO can make than their lowest paid person. And I know that sounds scary to people, but when we live in a world where the CEO is making $46 million in a year and the person answering the phones is making $7.25 where the person waiting the tables is making $2.13 and is well below the poverty line, it's just out of control. So how about instead of, you know, $43 million, you make $25 million and pay everyone $15 an hour, right? So there needs to be some sort of regulation in that, in my opinion.

But I'm not really here to give all my opinions on it. I'm here to talk about the facts and why people should be skeptical of tipping. But as an example, every Starbucks has a tip jar. And when you swipe your card, you have the option to tip the bristas, right? Well, last year, Starbucks had $26.5 billion in profit. And as of January of 2022, they have finally said they're going to start paying $15,000. $15 an hour. I mean, look, I understand the minimum wage argument, and that's probably a whole different sort of show here. It really is. But it seems like the market will take care of

getting people paid more if, frankly, they're losing workers and they can't afford to bring people in unless they pay a reasonable wage. Like, that's what the market does, right? But to your point, I also have read and heard that the minimum wage hasn't kept up with things like inflation even a little bit. It's not even close. And it hasn't caught up with, let's say productivity at all from the middle of last century to now. And that's a bigger problem, right? Not like, oh, we need to pay people more for doing menial work or whatever you want to call or minimum wage hourly work. It's that the value of that minimum wage has just gone down. It hasn't just stagnated. It's gone nowhere. And it's in fact gone south in terms of what you can buy with it.

Yeah. Productivity is the key piece. So from 1938 until about 1968 or 67 or so, minimum wage was incrementally increasing based on productivity. So how much that company was producing, right? How much the country as a whole was producing so that essentially the worker was sharing in the growth of how much product was being put out. And then around 1965 to 1968, they decided to start connecting it to nothing instead of productivity. And so now you can see the wages just dropping while the profits are skyrocketing. I mean, if it were to have kept up with its productivity, right now minimum wage, federal minimum wage would be $24 an hour. But the problem is these companies have just been increasing their profit margins, like Starbucks making $26 billion in profit

for a year, and keeping the pay extremely low. And then they make everyone believe that if they paid this fair wage. They either go out of business or they have to charge ridiculous prices for everything or whatever, which scares people into voting against their own interests. I mean, I don't really need to call out individual companies, but Olive Garden is a prime example. They reported $4.3 billion in revenue in 2020. They pay their CEO $10 million per year in a salary, which works out to about $5,000 an hour, by the way, while the average worker at Olive Garden across the nation makes $9 an hour. Now, if minimum wage would be 24 an hour, if it had kept up with productivity, and it's only $9 an hour, I mean, think about the level of poverty you're creating and how the middle class is shrinking

because more and more people are working and poor, while the upper class is getting these giant $10 million salaries, and the corporations and investors are getting billions of dollars in profit. And in March of 2021, Olive Garden finally made this general announcement that they would be paying $10 dollars an hour as a minimum. Does this issue spill over into non-tipped workers as well? Because I know that it's kind of like knock-on effects in the economy. You know, that's the main argument is, oh, the prices are going to go up, et cetera. That means that most likely there's going to be knock-on effects for all workers, not just tipped workers. Right. Yeah, because it becomes a mindset that this is how much

you're worth. This is where you need to be as far as a salary goes. So even companies that don't have tipped workers sort of had this same sort of mindset. For example, Home Depot. They reported over $12 billion in profits with $195 billion in total assets, but they pay their cashiers around $9 an hour. Their sales associates make around $11.34 an hour. So tipping in restaurants is just, it's a way to offload cost on the customers, like Apple making you pay for your warranty and they call it AppleCare. Remember when you would just buy a laptop and it was covered? And if something happened in a year or two, they fixed it. or they sent you a new one, you now have to fund that.

You have to buy your own warranty or Best Buy making you pay for a Geek Squad plan or they won't help you with your Best Buy products. Companies have been doing this more and more. Restaurants are doing it more and more, and restaurants just have this easy way out with tipping because it's like we talked about, it's guilt-driven. I don't feel the need to tip the guy at Best Buy, you know, but who knows? They may start that, you know, if they feel like they can make more money at it. Sure, yeah, we're no longer paying our workers.

and if you want them to actually do anything, like help you carry that heavy as TV out to your car, you've got to pay for it. What about race coming into this? I know that there's been some studies on like Asians, for example, making far less than white or Latin or for anybody, for that matter, when it comes to tipping, which I thought was interesting.

Like, I wasn't expecting this, but I guess race plays a part in pretty much everything. So there's a study, people can look this up. It's from Eater Analysis, and it talks about the current population survey data on tipped workers. The one that they listed here is the integrated public use microdata series. And that study showed that on average, on this is a national average, white servers make $7.6 per hour just in tips.

So if you're white and you have a tipped job on average, you're going to make $7.6 an hour just in those tips. While Latin servers make $6.8 in tips, black servers make $5.57 cents in tips, and Asian servers make $4.77 in tips. And that same study notes that servers, the servers themselves, also have a bias. So I'm going to pause here and just say, this could have a lot to do with people with tribalism, right? If most people in the country, like 60-something percent of the country is white, if your server happens to be white, you feel more connected with that person subconsciously, you can identify with them more often, or you can say,

well, that reminds me of me when I was 19, and then you tend to tip more. But if someone is of a different race... But I was never a 19-year-old Asian guy, so I can't relate at all. Right. You don't consciously do that, but I think people just tend to go, well, they're not one of me, and so they don't feel compelled to give that money. But the study also showed, interestingly, that servers also have the same bias in the other direction. So they will treat people of color differently, statistically, based on the perceived tips or the lack thereof. So there's this man named Vince Dixon. He wrote an article called The Case Against Tipping in America. And a lot of what I'm about to tell you comes directly from there. So I encourage people to go look that up. The Case Against Tipping

in America by Vince Dixon. Yeah, we'll link it in the show notes. Yeah, perfect, perfect. He says in a 2012 study by Zachary Brewster, a sociology professor at Wayne State University, they found that, quote, servers may provide slower service to black diners or try to turn the table over more quickly. And in some restaurants, servers actively avoid waiting on black customers because they believe that they would lose out on tips. In some instances, restaurant staff played games in which servers tried to stick one another with black tables, or they developed code words with one another to warn each other when a black table is seated. This behavior was sometimes allowed by management. And in one 2012 study, Brewster surveyed 200 servers from a bar and grill

style restaurant, or multiple bar and grill style restaurants. And he asked the servers about their perceptions of black diners and whether they'd seen discriminatory behavior or whatever by other employees. Most respondents admitted to providing different levels of service based on a diner's race. Or they at least admitted to witnessing another server do so at least sometimes. And in similar studies published by Brewster and colleagues, the servers who admitted to profiling black customers justified their actions by claiming that black patrons demanded more service, but tipped less. And another study found other sentiments published online and message boards for waiters, including Appleby's even fired one person because they tracked down who it was at a location

in Missouri for racial profiling. Now, here's the kicker. Research does show that black diners appear to tip less than white diners by about three percentage points, but the reasons are nuanced and really unknown. So even if the difference is only three percent across the board, the perception that they're going to tip less creates this issue of them actually being treated differently. So once again, this just drives another nail in the coffin of why tipping is just terrible. It just encourages racism when if there was no tipping allowed and everyone made you know, a fair wage, we wouldn't even have this issue. There would be no reason to treat anyone differently to begin with. Unless you're actually a racist, right? This encourages like the subtle

nuanced racism that you don't think is there. But if you're actually a racist, you're still going to be a racist a-hole, regardless of whether or not you tip or not. You're still going to give crap service to somebody you don't like because of the color of the skin because you're a piece of crap, not because of the tips. Absolutely. So, so I don't know. Yeah, the problem may not be entirely solved there, but it may indeed be reduced. Sexual harassment, I know, is also a thing. I just like to hear some of the crazy stuff that happens to them. And show fans right in with crazy stuff that happens to them for Feedback Friday. And some of it is, you know, I'm working at a restaurant, my manager or a customer does XYZ.

And it's just, it's shocking. I can imagine it's more widespread than people think. Oh, yeah. I saw one thing. I wasn't able to verify this, but I want to throw this out there as an unverified piece of information. I saw a mention online that 65 to 70 percent of tipped workers are female. That sounded high to me, but it's important to know that they're definitely the majority. I don't know exactly what the number is, but they're definitely the majority.

And we already know, I mean, sexual harassment is already a huge issue in food service. And when you take that and you force workers to rely on the kindness and generosity of a patron, that's also known as how much they like you or how likable you are. Now you're talking about just piling on reasons to contribute to abuse or sexual harassment. From that same Vince Dixon article in the case against tipping, he says that the notion of this is born from data showing that women working in restaurants in states with lower minimum wages for tipped employees are twice as likely to report sexual harassment than those who work in states who have a minimum wage for all workers. So women in these states were three times more likely to report being told by management to dress sexier or to alter their appearance or whatever. Like imagine what the customers are saying to them in order to get those tips. I mean, it's just, it's bizarre.

And if a woman thinks, hey, if I have this low cut shirt and I have my boobs pushed up, I can see an increase in my tips, then they're going to go to what makes the most money sometimes. And so it just, it fosters more sexual harassment, even if we don't realize that's, that's what we're consciously doing. Yeah, I mean, I've had friends of mine sort of tongue in cheek say they'll go get maybe an augmentation, breast augmentation, and they'll say, these things are going to pay for themselves. And they're not really kidding. Yep.

You know, they're not really joking about that. Yeah. And, you know, some of my friends are a little out there, but I don't think it's that unusual. No. Right? I don't think it's, and I don't think it's a ridiculous statement either. I think it's probably quite true. Yeah, absolutely.

So how do we fix this? I mean, it looks like, it sounds like, you know, Kami Dave over here is trying to get a federal minimum wage increase. And I say that, I also say that tongue in cheek, of course. But, but what, tie it back to some sort of metric here? I think so. I think a percentage, whatever the CEO makes type situation, whatever the, we definitely need to tie it back to productivity because you can look at charts

online of when minimum wage stopped growing or when pay started dropping in comparison with productivity and corporations' profits. You'll see that we used to tie it to productivity and then we stopped. And so now that that allowed the corporations to make more money and pay much less. And here's the issue about all of this. Whatever we were talking about, a tipped worker going into work, making their two, 13 an hour, getting enough tips to equal the other 512 and hour, so now they're making 725, and then they have to go roll silverware for three hours. There are stipulations, like, well, at least 20% of your work must be tipped work in order for you to be a tipped worker. Who's managing that at the local diner in Madison, Wisconsin, down

the street from where someone grew up? If a 19 or 20-year-old had to do 30% of work that was not tipped work and they barely made minimum wage and they didn't get opportunities to who are they going to call, right? Are they going to start? Are they going to have a lawsuit? Are they going to go hire an attorney? Like how hard is it to really sue your employer? And then if you do that, you're certainly going to get, you know, blackballed. You're definitely going to get harassed at work or fired or your hours are going to get cut. The Department of Labor found that in 2016, the food service industry owed $39 million in back wages. Holy smokes. That's a lot. And was one of the largest violators of wage labor laws. And that's just the ones that were reported.

For everyone that wasn't reported, or for everyone that didn't want to start trouble or just said, screw it, I'm going to quit my job and go work for Subway, those didn't even get reported. It was so egregious that the Obama administration banned the whole tip-pulling thing back in 2011 and I already told you, you know, Trump did it again. But this compromise was agreed on by Congress. So you can't even really just blame one president or another. But honestly, I think the only real reason to, the only real way to fix this, it's the not only increase the minimum wage on a federal level, but tie it back to productivity. So their employers share in that profitable growth of a company, and then we can slowly phase out tipping, just like Europe has. And I think in order to prevent what you were talking about, where, you know, a pizza is 70 or 80 bucks, I think we could tie some sort of maximum profit to it to say, look, we want you to be profitable. We don't have a problem with you making $300 million as long as you're paying your employees a livable fair wage. I don't see what's so hard about that. I don't think you have to cap profits at all. I mean, honestly, again, it might be expensive, but those businesses survive just fine out there. That's the thing is

Europe might be slightly more expensive and people get used to paying a little bit more for things like going out to eat, but those businesses all survive. It's sort of a myth that making things slightly more expensive, if they even have to get more expensive at all in order to fund this, is going to damage that business. I'm definitely, again, I say this on every show, but I'm a free market guy. The thing is, the free market can handle this. The free market can handle this without making it just a horrible, crappy experience for workers at the same time. It can do that. Yeah, I agree. And rather than putting in those stipulations I was talking about, it might even just happen naturally. If you have to pay this minimum wage at $15 or $20 or $25 an hour and that becomes the new norm, maybe naturally your profits will just go down a little bit. Or maybe you tell the CEO, hey, instead of paying you $14 million, we're going to pay you $12.6 because we're trying to cover some hourly rate. Like, what's wrong with that? Basically, Jordan, the way it's going right now,

this is a race to the bottom. We're absolutely tanking it. So to protect the tipped workers, to protect people, I just think not only do we need to do something about this on the federal minimum wage level, we all need to be really skeptical about the whole concept of tipping in the first place. David, thank you very much.

Comey, David. Really appreciate your time and expertise. Thanks, brother. I wanted to give you a preview of one of my favorite stories from an earlier episode of the show. Megan Phelps Roper, she used to belong to one of the most hateful religious cults in America, the Westboro Baptist Church.

She was born into this church and she later escaped. To hear her tell the story firsthand, it's really incredible. I started protesting when I was five years old, but even at that first picket, there was a sign that said, gays are worthy of death. So God hates facts is what Westboro's message that we became known for. We were the good guys, and everyone outside the church was evil and going to hell, and we had the only message that would bring the world any hope. We had to go and warn people. These terrible things are happening. And if you want this pain to stop, then you have to change

because God isn't going to change. After the September 11 attacks, we had the sign that said, thank God for September 11. What were we thinking? This massive crowd comes down. We were at this corner of this intersection of these three streets. By the time they actually reached us, we're just enraged. There was no space between us and them. It got really dicey. One of my cousins gave his signs to somebody else and started standing on top of a trash can, pretending like he wasn't with us. They were, again, incredibly intense because obviously the circumstances are so sobering. It brings me incredible sadness to think about now. I can't do this forever. My family, they would refuse to have any contact with me at all once I left. Somebody that we had confided in sent a letter

to my parents and told them that we were planning to leave. And then that email came in and we left. For more with Megan, including the details of her harrowing experience and escape, check out episode 302 of the Jordan Harbinger Show. Thanks again to David C. Smalley. A link to the show notes for the episode can be found at Jordan Harbinger.com. Transcripts are always in the show notes. I'm at Jordan Harbinger on both Twitter and Instagram,

or just hit me on LinkedIn. You can find David Smalley at David C. Smalley on all social media platforms at David C.smalley.com or, better yet, on his podcast, the David C. Smalley Show, links to all that will be in the show notes as well. This show has created in association with Podcast One. My team is Jen Harbinger, Jace Sanderson, Robert Fogart, Ian Baird, Millio Campo, Josh Ballard, and Gabriel Mizrahi. Our advice and opinions, they're our own, and I'm a lawyer, but I am not your lawyer. So do your own research before implementing anything you hear on this show. Remember, we rise by lifting others. Share the show with those you love, and if you found this episode useful, please do share it with somebody else who needs to hear it. In the meantime, do your best to apply what you hear on the show so you can live what you listen, and we'll see you next time. This episode is sponsored in part by Something You Should Know podcast. Finding a new great podcast shouldn't be this hard, so let me save you some time. If you like the Jordan Harbinger show,

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