Hospitality workers say tips down thanks to tap and go payments

With many venues not accepting cash or using tap-and-go, many hospitality workers are reporting a decline in customers tipping.

The Prince operations manager Jess Harker at the Prince Public Bar. Picture: Jason Edwards

As Victoria’s hospitality industry emerges from the snap lockdown its workers are contending with another issue: COVID killing cash tips.

With the rise of tap-and-go and contactless payment, the increasing use of mobile apps to order and pay for drinks and meals in venues, and with paying with cash frowned upon — and not even accepted at some venues — hospitality workers are reporting a decline in customers leaving gratuities when paying the bill.

Co-owner of a range of diverse hospitality businesses across Melbourne including Small Print Pizza in Windsor, Rusty’s Sandwich Parlour in East Brunswick and beer hall Burnley Brewing, Phil Gijsbers said the rise of tap and go meant it was “almost impossible to tip”.

“It’s a continuation of a trend towards less tipping by customers,” he said.

“Australians are moving further away from tipping, especially in the casual dining scene.”

“Over the past 10 years tipping had been going down. COVID has put the nail in the coffin.”

Prince Hotel operations manager Jess Harker agreed and said tipping across the venue, including at the restaurant and public bar, had “dropped substantially”.

COVID has accelerated a trend towards less tipping at casual venues, according to Burnley Brewing’s Phil Gijsbers (right) with brewer Michael Stanzel. Picture: Nicole Cleary

“It all went downhill once signature payments were abolished years ago. And since reopening (after lockdown) it has dropped even further due to less cash being used, smaller and more frequent PayPass transactions, and more hip pocket-conscious consumers,” she said.

“More and more businesses are also transferring to order-and-pay at the table systems,”

“These are eliminating personal service, and therefore losing tips, as they tend to charge the fees the system charges the business.”

However, Ms Parker said the generosity of diners who did tip had “increased to show industry support”.

Co-owner of South American San Telmo restaurant group Renee McConnell also reported customers at her CBD restaurants tipping more generously.

“People want to tip, if your systems let them,” she said.

Victorians are the most generous tippers in the country, according to mobile ordering app me&u founder Stevan Premutico. Picture: James Croucher

Founder of ordering and payment mobile app me&u Stevan Premutico said when tap and go was first introduced a few years ago it “sent shockwaves through the industry” and tipping “dropped through the floor”.

“It gave customers the chance not to tip,” he said.

In July last year, the platform introduced an option for diners to tip and “the take up had been huge”.

“We expect $10 million to be left in tips across Australia through me&u this year,” he said.

According to me&u data, Victorians are the best tippers in the country, leaving 11 per cent more than diners in Sydney and double the amount Queenslanders leave.

Co-owner of Hemingway Wine Bar in East Melbourne Glen Bagnara said his customers were so happy to be dining out again post Melbourne’s long lockdown that tipping had been more prevalent.

Customers at Hemingway’s Wine Room are tipping more to support hospitality workers, according to owner Glen Bagnara

“They have become more appreciative of being out and about and understand the hospitality industry has been hit hard with both owners and staff feeling the full effects of COVID. They are more appreciative of good service and are happy to reward those who offer it,” he said.

“People have been much more forward about asking where or how they can leave or give a tip. With tap and go payments, we give our customers the option to tip on the system. Many also pay on cards but give cash tips.”