Raise the wages of service staff or implement a tipping culture?

10 September, 2019
By Dharshini

Raise The Wages Of Service Staff Or Implement A Tipping Culture?

The wages for service staff has been a longstanding debate. These particular group of employees are subjected to long working hours, even longer overtime hours and nasty remarks from customers - all for a meagre hourly rate figure.

In countries like United States, service crew can rely on tips to boost their daily or monthly earnings. According to the United States Department of Labor, the minimum hourly rate that a tipped restaurant service crew in United States earn is USD2.13 (SGD2.85) per hour. In general, the tipping rate in United States ranges between 15% to 20% of the total bill, depending on the quality of service. Most of the time, these tips are for the service crew themselves to keep.

In Singapore, there is no minimum wage law implemented. However, service crew in Singapore can expected to earn only about SGD6 to SGD10 per hour. Moreover, tipping is not customary in Singapore - even in restaurants. In some places, such as airport, airport staff are forbidden from accepting tips.

With this single-figure hourly rate, coupled with the 10 hours and 6 days work week that service crew are expected to work, this brings their monthly salaries to around SGD1,000 to SGD1,500 at best. Is this amount sufficient for service crew to get by? Certainly not.

The solution? Raise the hourly wages for service crew or implement a tipping culture in Singapore.

Raising the hourly wage for service crew can help employees to cope with the increasing cost of living in Singapore. Moreover, having a wage structure with annual increments helps to ensure a sustainable wage amount for employees. However, implementation of a fixed pay structure can also mean higher labour costs for the business. Likewise, meal prices might hike up in order to compensate for the increase in labour costs.

On the other hand, suppose Singapore introduces a tipping culture within the service industry, this could significantly reduce labour costs for businesses. The additional “monies” provided to service crew depends solely on the quality of service and attitude of the employee. Yet one main concern is the attitude of Singaporean themselves. While Singapore has been ranked as the 28th most generous country in the world (according to the World Giving Index), the generosity is dependent on whether it will make a significant contribution to society or not.

Incorporating a tipping culture in Singapore is certainly not out of the question. While it might deviate from the societal norm of Asian countries, a significant amount of effort and time is require to ingrain this tipping culture in Singapore.

Posted in Human Resource