History of Tipping
How a controversial custom
became part of everyday life.
Tipping has a complicated past. Its history touches on class, racial inequality, workers’ pay, and the relationship between customers and the people who serve them. Understanding that history gives us a more
thoughtful way to approach tipping today.
1850s–1860s : A European Custom Comes to America
Wealthy Americans returning from Europe help introduce tipping to the United States. Many Americans resist the practice, viewing it as a symbol of aristocracy and class division.
[time.com], [smithsonianmag.com]
1865–1890s: Growth After the Civil War
Tipping spreads through restaurants, hotels, and railroads. Some employers use it to avoid paying adequate wages, particularly to formerly enslaved Black workers whose employment opportunities are severely limited. For many, tips become essential income rather than an extra reward.
1890s: Tipping Becomes More Established
By the 1890s, tipping is increasingly common in hotels, restaurants, barber shops, and railroad sleeping cars. Many service workers depend on gratuities to supplement low wages, even as Americans continue debating whether the practice is fair.
1904 : Americans Organize Against Tipping
The Anti-Tipping Society of America forms in Georgia. Members pledge to stop tipping, reflecting a growing movement against a practice many consider undemocratic.
1909–1915 : Six States Try to Ban Tips
Arkansas, Iowa, Mississippi, South Carolina, Tennessee, and Washington pass anti-tipping laws. Despite these efforts, the practice continues.
[mytipcalculator.net], [smithsonianmag.com]
1916 : The Itching Palm Challenges the Custom
William R. Scott publishes The Itching Palm: A Study of the Habit of Tipping in America. The book argues that tipping undermines dignity and democratic equality, capturing the intensity of the debate.
[mytipcalculator.net], [cbsnews.com]
1920s : Tipping Outlasts the Bans
By the end of the decade, those six states’ bans have been repealed or overturned. During Prohibition, lost alcohol revenue also gives hospitality businesses an incentive to embrace tipping as a way to limit wage costs.
1938 : A Federal Minimum Wage Is Established
The Fair Labor Standards Act establishes a federal minimum wage for covered workers. Its protections expand over time, with later amendments changing how tipped workers are paid.
1966 : The Federal Tip Credit Is Introduced
Congress adds a “tip credit” to federal wage law. It allows qualifying employers to count part of a worker’s tips toward their minimum-wage obligation, rather than paying the entire amount directly.
1991 & 1996 : The $2.13 Cash Wage Takes Shape
In 1991, the federal minimum cash wage for tipped workers reaches $2.13 per hour. In 1996, Congress fixes that obligation at $2.13 instead of keeping it tied to a percentage of the federal minimum wage.
[cbsnews.com], [mytipcalculator.net]
Late 20th Century : Tip Expectations Rise
A 10% restaurant tip was customary in the first half of the 1900s. By the 1980s, 15% had become the baseline, with 20% becoming increasingly common in later years.
[richmondfed.org], [smithsonianmag.com]
2020–2021 : Pandemic Generosity
Research finds that tip amounts increase in several restaurant settings during the pandemic, including quick-service and takeout businesses. Supporting service workers becomes a motivation for many customers.
2020s : Digital Prompts and Tipping Fatigue
Digital payment screens bring tip requests into more transactions. In a 2023 Pew Research Center survey, 72% of Americans say tipping is expected in more places than five years earlier.
Understanding Tipped Pay Today
The federal minimum direct cash wage remains $2.13 for qualifying tipped employees when an employer meets the tip-credit requirements. Wages and tips must reach the applicable minimum wage; employers must cover any shortfall. State and local rules may require higher pay.
A More Personal Way to Say Thank You
At Cheerful Tipper, we believe the person behind the service deserves to be remembered.
Our cards give you space to recognize your server by name, share thoughtful feedback, and record the date
and time of your visit. Pair one with your tip to make your appreciation personal.
Remember their name. Recognize their care. Spread the cheer.
