Ethiopian Business Review

Living by the Tip: The Evolving Culture of Tipping in Ethiopia

In one of the recent hits of Woody Allen’s thrilling movies ‘Blue Jasmine’, (winner of this year’s Academy Awards for best actress and nominated for best picture and best screen play); there is a scene where the leading character, a sophisticated but broken woman is baby sitting her nephews. She takes them out to a restaurant and tells them to be generous when they are rich and advises them particularly to be kind to waiters, saying: “Tip big boys; tip big, because you got good service and they [waiters] count on tips”.

With the staggering economic performance in the past few years, nearly four out of five college students in the United States work part-time jobs while pursuing their education. A substantial number of them work in cafes and restaurants as waiters and their incomes depend more on the tips than their formal salary. Considering the substantial amount of tips, (the standard is 15Pct of the bill), they are even excluded from minimum wage laws.

It is not only in the United States and other advanced countries that the role of tips are playing a vital role in supporting those without a good educational background or people making their way through college. Emebet Teklu, 31, a waitress in Adea Hotel on the Debre Zeit Road around Beklo-Bet in Addis Ababa is an example of how indispensable tips are to people rendering services in hotels, cafes and restaurants. After finishing high school, Emebet didn’t go to college even though her high school leaving examination results were well above the average score. She couldn’t get a job and stayed at her parents’ home for a while. Two years ago however; she was hired as a waitress in a hotel and realized her dream of joining college. “I earn up to 1,700 Birr a month and I am now studying Marketing Management at one of the private colleges,” Emebet told EBR. Though her monthly salary is only 250 Birr she gets an average of 50 Birr per day in the form of tips.

Another young man who bettered himself through tipping is Daniel Haile. He was a 7th grade teenager when he started working as a waiter in early 2007. He then moved from place to place and worked for meagre pay that ranged from 80 to 200 Birr a month. But with the income he received from tips, he helped himself and was able to study pastry making, paying a total sum of 4,500 Birr and now has become a professional. He is currently working at a pastry shop, earning 1,500 Birr in monthly salary. “The income I get in tips has helped me not only to survive but also to upgrade myself and have another job with a sustainable income,” he said. 

Despite the fact that there isn’t precise information on when the formal way of tipping became part of the culture in Ethiopia, it has been part of historical tradition to give something additional as ‘gursha’ or ‘daregot’ to someone who has done a good job. Currently tipping is common in hotels, restaurants and bars. It also extends to parking services, barbershops and beauty salons. People are becoming more used to tipping especially in cafes and restaurants, although the amount varies.

Though the culture of tipping has become quite common in urban Ethiopia, it has evolved without any guidelines as to how much to tip. In countries like the United States tipping is expected, since service personnel depend on it and unofficial standards and customs call for tips to be 15-18Pct of the total bill.

Nevertheless, many associate tips with the quality of service rendered to them. Others, however, are forced by social psychology and peer pressure to do so. Some people also refuse to tip when the services given to them are unsatisfactory or a service charge is added to bills. Kirubel Ayele, 32, a banker by profession, who usually visits restaurants near his home around Gotera interchange on Debrezeit Road and workplace, considers the quality of service when giving tips. If he is not satisfied with the service he doesn’t want to tip and if a service charge is added to the bill he doesn’t consider tipping even if he gets great service. For Kirubel, who earns ETB9,000 a month and pays ETB3,100 for a one bedroom condominium house, tips should be treated as a return for the service rendered. “A tip is not something that has to be paid in spite of the service quality,” he told EBR.

Contrary to the views of Kirubel, Buzayehu Frew, 31, an economist by training, is not in favour of giving tips at all. His reason comes from his understanding that he is not the one who pays the salary of service personals. This is the responsibility of the restaurants and bar owners, he argues.

Some people forget to add an extra amount for the tip or they believe someone else is going to take care of it. When this happens it can turn into a really bad day for the waiter. Last month there were headlines in international main stream media including the Guardian when a server posted a bill on Reddinte to make a point: “tips are not optional. They are how waiters get paid in America.” In response to disappointment in a woman who left no tip along with a note that said “I give God 10Pct. Why do you get 18?”

Nany Assefa, 29, who earns ETB3,000 a month, on the other hand, prefers to tip most of the time. “Yes I often tip, because they expect me to do so,” Nany told EBR.

In some circumstances failing to give an adequate tip when one is expected to is a serious faux pas, and may be considered very miserly, a violation of etiquette, or unethical. In many countries, the rationale behind tips lies on the fact that those job categories are usually excluded from the general minimum wage standard and categorized as tipped jobs. In the United States the legal minimum wage is USD7.25 per hour. But for an employee in a tipped job category the minimum wage standard is USD2.13 per hour. The reason behind this is that the tips they receive from their customers together with their fixed salary will be equal or above the general minimum wage. Employers are obliged by the federal law that if money from tips does not equate the general minimum wage standard, they must make up the difference.

Tips are uncertain in Ethiopia. Service personnel may or may not get them. Unlike the United States of America employers are not under any kind of obligation to make any kind of subsidy. Service personnel are supposed to work 8 hours a day and seven days a week, with no Sundays or holidays off but are not entitled to more than 500 birr per month. This seems too small to survive with the current high cost of life in Addis Ababa. Perhaps, it is time to install a minimum wage scale in the country. Many waiters are either from poor families who have dependents they support or are young girls and boys who try to make changes in their lives by working in the daytime and studying at night or through other extension programs. Their livelihood is entirely dependent on the tips they expect from customers more than the salary they earn from their employers.

If some one’s livelihood depends on others, it seems that the later has a moral obligation to be responsible for it. Or those who receive service should be at least grateful for the services and smiles bestowed and respond to them by tipping. And the suggestion “tip big, because you got good service and they count on it,” seems universally appealing.

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