Cashless Payment Outage Leaves Square-Shaped Hole in Many Wallets

calendar iconSep 24, 2021

A malfunction in cashless payment provider Square’s system over the weekend cost workers across America several hours' worth of tips on the busiest day of the week, leaving customers red-faced and businesses missing sales.

No technical details for the outage have been provided, with The Register reporting Square’s status page only noted ‘multiple service issues’ on Saturday. These issues, however, caused chaos in affected businesses, with service-oriented venues hardest hit, given tips amount to more than half of the earnings of wait staff and bartenders, according to the National Employment Law Project.

Business owners have been left with a difficult decision over whether to reimburse their workers out of their own pockets. Andrew Sinclair, owner of Mad Lab Coffee in Hollywood, said he estimated one staff member had lost out on between $150 and $250, and intended to pay this, but was hoping that Square would reimburse him the money. Many have echoed this sentiment, calling on Square to at the very least refund their processing fees.

Square, one of the busiest days we ever had and tips weren’t working!? In this economy?? I’m kindly requesting you refund the processing fees so I can pay my employees what they missed out on today. This isn’t okay.”
"Erica Escalante, Owner of Café ReinaPortland, Oregon

The incident once again highlights the benefits of cash tipping. Even when cashless services are functioning correctly, there are downsides for workers, such as businesses that opt to deduct transaction fees levied by card companies from tips received by their staff. Cash tips are not at the mercy of service outages, and ensure the full amount goes directly to the server who earned it.

Last Updated: Sep 24, 2021