U.S Tipping Culture Is Rooted In Racism
Overview
Tipping Culture is rampant in the U.S as of 2026. It follows consumers everywhere, you’re expected to tip at every store you enter and tip every delivery person no matter the distance. It’s a common complaint that tipping culture has gone too far, but most people don’t even know where it originated.
European Tipping Origins
While the exact location and time tipping culture first emerged is oft-debated. The early documented instances of tipping was in The Middle Ages. Where wealthy landowners would occasionally give extra coins to servants and laborers for their good service.
By the Tudor era it soon became an expected practice, all guests of private households were expected to give extra sums of money “Vails” to the house servants.
This created a problem as house workers soon began doing extra aimless and arbitrary tasks in hopes of getting Vails.
The visiting masters hated this so a group of masters unanimously abolished the practice in Edinburgh Scotland 1790 and decided it would be more honorable to pay a higher wage for masters and servants.
This did not completely eradicate the practice in Europe, Many guests would just have to hope that the master of the house they were attending would veto Vails but that wasn’t always the case.
Many folks at the time blamed Americans, when foreigners visited they’d tip lots of money making the natives of the area have to increase the Vails they’d give as to not be embarrassed.
The Rise In Tipping Across The U.S
Despite the fact it was the newly rich Americans who brought the practice back from Europe, when tipping first arose in the U.S it was seen as un-American.
So how did we get from treating tipping as something antithetical to the American way to something that’s almost obligatory?
After the Civil War, Newly Emancipated Black Americans had to find jobs with little options. Employers no longer having a way to exploit their workers had to come up with something new.
Racial discrimination in all aspects of civil society was still rampant. Many restaurateurs refused to pay newly minted freedmen wages. Thus, the use of tipping to pay a worker’s base wage, instead of as a bonus on top of employer-paid wages, became an increasingly common practice for service sector employment.
Tipping was a growing custom among servants, coachmen, barbers waiters, and railroad porters. These were all job dominated primarily by black Americans.
The Pullman Palace Car Company was established by George Pullman in 1867, becoming the Pullman Company in 1900. The company was the largest employer of African Americans at the time.
In the 1860s, the company purposely hired “formerly enslaved people to achieve the high-quality customer service the Pullman cars were known for,” according to the Library of Congress. Workers shined shoes, made beds, woke up passengers and so on. They worked long hours and relied heavily on tips for pay.
In 1891, journalist Arthur Gaye wrote that a tip was bestowed upon a person “who is presumed to be inferior to the donor, not only in worldy wealth but in social position too”.
In 1900, a third of all Black workers were in domestic or personal service, including nearly half a million “servants and waiters”—the second largest category after laborers, and a much greater percentage than Black workers’ percentage of the population. As I have demonstrated, this labor stratification was a direct legacy of slavery that functioned to continue the exploitation of Black workers after Emancipation—with effects compounding into the present day.
In the early 1900s, six U.S. states—Washington, Arkansas, Iowa, South Carolina, Tennessee, and Georgia—enacted laws banning tipping.
These exact kind of employers, who shared a common goal of keeping labor costs down and preventing worker organizing, formed the National Restaurant Association (NRA) in 1919 . Over the past century, the NRA has lobbied Congress to achieve these goals, first by excluding tipped occupations from minimum wage protections entirely, and later by establishing permanent subminimum wages for tipped workers (One Fair Wage 2021).
The 1938 Fair Labor Standards Act (FLSA) and its subsequent amendments further enshrined this discriminatory treatment of tipped workers. Though the FLSA is known for having established fundamental worker protections—including the 40-hour workweek, overtime protection, and a national minimum wage—the law initially excluded protections for hotel, restaurant, and other service workers.
Proponents of the FLSA deliberately excluded industries that were the predominant employers of Black Americans as a means of securing needed support of Southern Democrats in Congress (Dixon 2021). These gaping holes in the FLSA’s protections persisted for roughly 30 years, until the mid-1960s, when the FLSA was amended to extend coverage to service sector workers.
However, while service workers in restaurants, hotels, bars, and elsewhere would now be covered under the law, the 1966 amendments to the FLSA created a “tip credit.” The tip credit allowed employers to count the tips received by their staff against 50% of the minimum wage they were required to pay—effectively establishing a separate “tipped minimum wage” set at half the regular minimum wage.
Subsequent amendments to the FLSA adjusted the level of the tipped minimum wage to varying percentages of the regular minimum wage, reaching as high as 60% in the 1980s. In 1996, the FLSA was amended again to raise the federal minimum wage from $4.25 to $5.15. However, the bipartisan deal that was struck in Congress to achieve this increase decoupled the tipped minimum wage from the regular minimum wage. The deal locked the tipped minimum wage statutorily at $2.13 per hour (50% of $4.25), the level at which it had been set in 1991 (Allegretto and Cooper 2014).
Although the legislative history is sparse, it is widely understood that these exclusions were a facially race-neutral way to deny Black workers coverage under the FLSA.
Modern Day Tipped Racial Inequalities
Today, the tipped minimum wage still rests at 2.13 per hour, which has been stuck at $2.13 since 1991, is a clear barrier to their goals.
A survey by One Fair Wage found that prior to the pandemic, Black tipped workers’ income, including tips, was already substantially lower than their white counterparts’ earnings, with 60 percent of them reporting earning less than $15 per hour, compared to 43 percent of white workers. Since the pandemic, 88 percent of Black tipped workers, compared to just 68 percent of all workers surveyed, have seen their tips plunge by half or more.
Across the U.S., poverty rates for tipped workers are 2.3 times as high as poverty rates for non-tipped workers (11.3% vs. 4.9%) (EPI analysis of Ruggles et al. 2024).
About 4,100 workers in five states and Washington, D.C., participated in the survey, which was conducted over the phone and via email from October through January. It found that while Black workers represent the majority of the tipped service industry, they are also the ones making the least, according to the report, which examined government data and its survey’s findings, among other sources.
In only seven states (Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington), employers are required to pay tipped workers the full state minimum wage as their cash wage and cannot claim any portion of tips as a credit towards their obligation to pay all workers the full minimum wage.
ConCLUSION
While tipping culture began in Europe, U.S Tipping has always been based on racial inequalities. It has always unfairly impacted Black Americans and continues to do so in 2026, and the tipped sub minimum wage needs to be increased or eradicated in all states.
References
Tipping – An American Social History of Gratuities – Bookshop
Tipping is a racist relic and a modern tool of economic oppression in the South – EPI
The Dark History Behind Tipping In Restaurants – Food Republic
Brotherhood of Sleeping Car Porters Union Formed – Library Of Congress
