Downturn means decisions in holiday tipping

updated 7:15 p.m. ET Dec. 16, 2008

NEW YORK - In private, workers who depend on holiday tips might be willing to say they're getting hurt by the economic downturn. But fear that exposing that hard truth will lead to an even bigger falloff in their tips leaves most unwilling to discuss the situation publicly.

Service providers from hair stylists to baby sitters, from dog walkers to housekeepers, are quietly going about their business this season and trying to be thankful for whatever extra cash they're handed.

From an etiquette standpoint, that is what they're supposed to do anyway, of course.

"Holiday tips are really a way that we've always chosen to say 'thank you' for a year of good service," said Lizzie Post, an author and etiquette expert at The Emily Post Institute in Burlington, Vt.

In that sense, Post said service providers shouldn't expect tips. "Their salary or what they charge for their service, that should be what they're expecting," she said. "Anything more than that, you should expect to waiver greatly, especially in difficult times."

But everyone knows there's more to the social dynamic of tipping than a simple "thank you" for service, and that people who work in service fields often count on receiving a little extra.

Mike Lynn, a professor of consumer behavior and marketing at Cornell University, has surveyed consumers about why they tip and found that while rewarding good service was a primary motivation, other key factors included helping the service provider, and ensuring quality service in the future.

Yet the reality is that some people fear cutting a tip might generate resentment, especially for people like building superintendents and parking garage staff who are relied on frequently.

Tipping tips Some considerations to keep in mind when you're deciding whom to tip and how much: Budget: You shouldn't feel obligated to spend beyond your means. Non-cash gifts: If you need to cut back consider homemade gifts as an expression of thanks. Note: Any gift or tip should be accompanied by a short handwritten note of appreciation. Frequency: If you already tip for service throughout the year, you may forego an end of year tip, or offer a more modest holiday thank you. Service: Consider the quality and frequency of the service you receive. Relationship: Consider your relationship and how long you've been using the service. Source: The Emily Post Institute

Social pressures and the reality of a tight budget can leave people with little guidance on who to tip and how much. Those who are confused about what to do this year should remember that cash is never a mandatory gift, said Post, and the size of a tip should always be based on your personal budget.

As for who should receive what portion of your scarce dollars? "Think about the services you really couldn't have done without this year," she suggested. "I would think about making sure that was where my budget went to."

Among the people the Emily Post Institute recommends tipping are:

• An au pair or live-in nanny, for whom the suggested amount is one week's pay, plus a small gift from your child or children.
• The regular baby sitter, who should be given one evening's pay, plus a gift from the child or children.
• Day care providers, where smaller cash gifts should be spread out to each staff member who works with your child, plus a small gift.
• The Institute recommends checking with home health care agencies and nursing homes about their policies before offering a tip, but does not recommend a specific amount if there is no prohibition.
• It's also worth noting that mail carriers cannot accept cash or gift cards, according to U.S. Postal Service regulations, but can take gifts of small value.

As for service providers like hair stylists, personal trainers, pet groomers, landscapers and others, the general advice is to offer up to the cost of one session as a tip, or a small gift.

A gift might be something as simple as some homemade cookies with a note that expresses appreciation for the service they provide, Post said. "Remember that you should always be thanking these people with your words."

"Gifts like that are really a great way to go," she said. "They can be shared, they're not hard on your wallet, but they'll be appreciated."

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