Tipping Leads to Racial Pay Disparities?
A few years back, I got interested in taxicab tipping – and what influences how much people tip. So together with Fred Vars and Nasser Zakariya, I collected data on more than 1,000 cab rides in New Haven, C.T. and crunched the numbers. The study (published in The Yale Law Journal) found — after controlling for a host of other variables — two independent racial effects:
1. African-American cab drivers, on average, were tipped approximately one-third less than white cab drivers.
2. African-American and Hispanic passengers tipped approximately one-half the amount white passengers tipped.
African-American passengers also seemed to participate in the racial discrimination against African-American drivers. While African-American passengers generally tipped less, on average they also tipped black drivers approximately one-third less than they tipped white drivers . . . .
However, a new study co-authored by the world’s leading number cruncher on tipping, Michael Lynn, has found a similar effect in a Southern restaurant. His article, “Consumer Racial Discrimination in Tipping: A Replication and Extension” is based on 140 surveys that he and his co-authors:
collected during three lunch shifts (11:00 a.m. to 4:00 p.m.) at a [large national chain] restaurant located in the southern United States.
Focusing on just blacks and whites, the study once again found that:
Consumers of both races discriminated against black service providers by tipping them less than white service providers.
Ayres then gives us the employment discrimination law angle: “But as a law professor what is most interesting about Lynn’s article is his suggestion that an employer might be held liable under Title VII of the Civil Rights Act for establishing a tipping policy that has a disparate impact against African-American employees . . . But the harder question is whether the racial disparate impact of tipping is legally justified by the legitimate interest of businesses to enhance customer service.”
Very thought-provoking article, with some interesting tidbits about the history of tipping practices in this country. Should tipping be curtailed to prevent discriminatory impacts in pay practices?