There are cases where the employer is obligated to make up the difference if the minimum wage isn't reached by tipping. In that case, the alternative to you tip

There are cases where the employer is obligated to make up the difference if the minimum wage isn't reached by tipping. In that case, the alternative to you tipping the waiter $5 is that the restaurant charges you $5 more for your meal and passes that on to the waiter to meet the minimum wage requirement. If the restaurant eats the loss and doesn't raise prices, then you would be right, but restaurants already have thin margins and high competition so they would have to raise prices to raise wages and stay competitive. If tipping went away, menu prices would go up. However tipping is a form of price discrimination and an incentive for good service, which are both arguably good things. Obviously the much more common case is where the tip would not be replaced by the employer. So in that case if you don't tip the $5, the waiter is just $5 poorer. The restaurant's profit isn't affected one cent.