From European aristocracy to modern service economy: Understanding how tipping became a cornerstone of American culture
The practice of tipping has surprising historical roots. The concept can be traced back to ancient Rome and the Middle Ages, where wealthy patrons would provide small financial rewards to lower-class workers as tokens of appreciation. However, tipping as we know it today really took shape in Tudor England, where it became more formalized as a practice rooted in rigid class structures.
In medieval times, tipping was fundamentally a master-serf custom where servants would receive extra money for performing their duties exceptionally well. By the 17th century, it became expected that overnight guests to private homes would provide sums of money—known as "vails"—to the host's servants. These early tips often far exceeded regular wages, making them a coveted source of income for servants in well-to-do households. This practice soon spread to commercial establishments, including London coffeehouses and taverns.
The term "tip" itself has an interesting origin story. According to the Oxford English Dictionary, the word "tip" originated as slang, and while its etymology is unclear, the meaning "to give a gratuity" dates back to the early 1700s. One popular theory, though unconfirmed, suggests that "tip" comes from the acronym "To Insure Promptness," which allegedly appeared on bowls in 17th-century English coffeehouses where patrons would deposit coins to ensure quick service.
The term "gratuity," a synonym for tip, derives from the French "gratuite" and Medieval Latin "gratuitas," meaning "free gift." Interestingly, in many languages, the equivalent term translates to "drink money" or similar—such as "pourboire" in French, "Trinkgeld" in German, and "napiwek" in Polish. This reflects a historical custom of inviting servants to drink in honor of the guest and paying for it as a gesture of generosity.
Tipping arrived in the United States in the 1850s and 1860s when American travelers returning from Europe brought the practice home, wanting to appear aristocratic. However, early Americans viewed tipping with significant skepticism and even hostility. Many saw it as fundamentally incompatible with American values of democracy and equality.
Americans considered tipping undemocratic because it reinforced class hierarchies. As one 1916 anti-tipping activist, William Scott, famously declared: "In the American democracy to be servile is incompatible with citizenship. Every tip given in the United States is a blow at our experiment in democracy. The relation of a man giving a tip and a man accepting it is as undemocratic as the relation of master and slave."
This anti-tipping sentiment was so strong that six U.S. states passed laws explicitly banning the practice in the early 1900s: Washington (1909), Arkansas, Iowa, South Carolina, Tennessee, and Georgia. While enforcement proved problematic and all these laws were repealed by the mid-1920s, they demonstrate the level of resistance Americans initially had to importing European tipping culture.
The key to understanding how tipping became entrenched in American hospitality lies in the shift from the "American Plan" to the "European Plan" in hotels. Under the American Plan, room prices included meals, and hotel managers actively discouraged tipping, viewing it with suspicion as potential bribery. However, as the hospitality industry expanded in the late 19th and early 20th centuries, the European Plan gradually became the norm—rooms were sold separately from meals and services.
This transition created an economic problem: how should service workers be paid? The answer, over time and against significant social resistance, was through tips. Hotels and restaurants discovered that allowing customers to supplement wages through gratuities could reduce their payroll costs significantly.
The final blow to anti-tipping resistance came with Prohibition in 1919. Hotels and restaurants suddenly lost the substantial revenue from alcohol sales, creating financial pressure that pushed even reluctant establishments toward embracing tips. By the early 1920s, despite lingering social awkwardness, tipping had become firmly established in American hospitality culture.
While the mechanics of how tipping became popular are complex, the social context reveals a deeply troubling history. After the Civil War, tipping proliferated in the United States precisely when the restaurant and hospitality industries began hiring newly emancipated Black women and men—but offered them no wages at all. Instead, workers were expected to rely entirely on customers' gratuities for their income.
This wasn't coincidental. Tipping was essentially introduced as a mechanism to exploit the labor of formerly enslaved people. Employers could avoid paying wages altogether by shifting the financial burden to customers. As Saru Jayaraman, co-founder of Restaurant Opportunities Centers United, explains: "It's the legacy of slavery that turned the tip in the United States from a bonus or extra on top of a wage, to a wage itself."
The Pullman Company provides a stark illustration of this exploitation. Pullman, known for its luxury railroad cars, employed the largest Black workforce of any private company in late 19th and early 20th century America—nearly 12,000 Black men by 1930, almost all as porters. The company explicitly paid these workers minimal wages while encouraging reliance on tips. The porters themselves recognized this injustice. When the Brotherhood of Sleeping Car Porters unionized in 1925, their demands included a wage increase from $67.50 to $155 per week and the elimination of tipping entirely, under the slogan "Not servitude, but service." Despite their efforts and threatened strikes, these demands went unmet, and tipping remained entrenched in the industry.
Today, the legacy of this history remains embedded in American labor law. Federal law allows employers to pay tipped employees a subminimum wage—currently $2.13 per hour since 1991—with the assumption that tips will make up the difference. This remains one of the lowest wage protections in the developed world and continues to disproportionately affect workers of color.
According to recent data, over 27% of Black restaurant workers live in poverty, and about 37% of tipped workers are mothers. For a single mother earning tipped minimum wage, this often means going without breaks, insurance, adequate nutrition, and basic financial security. Tipped workers of color are also offered "living wage opportunities" far less frequently than their white counterparts.
Interestingly, the rest of the developed world moved in a different direction. Many European countries include service charges in bills or pay service workers substantially higher base wages, eliminating the need for tipping culture. Countries like Japan and South Korea view tipping as unnecessary or even rude, with excellent service considered part of the job rather than something deserving special compensation.
The United States remains unique—and increasingly isolated—in its reliance on tipping as the primary income source for service workers. This system creates ongoing debates about fairness, equity, and worker exploitation.
Understanding the history of tipping in America reveals that this seemingly simple custom is actually entangled with issues of class, race, democracy, and labor exploitation. What began as an attempt to appear aristocratic in 1850s America evolved into a system that shifted the financial burden of compensation from employers to customers—and disproportionately impacted formerly enslaved people and their descendants.
Today, as tipping culture expands to more industries and higher percentages (often called "tipflation"), many are questioning whether this system truly serves anyone well except employers seeking to minimize payroll costs. The historical context reminds us that tipping's current form isn't inevitable—it's the result of specific economic decisions and social hierarchies that, while deeply ingrained, can still be challenged and changed.