We played at a spring time flea market with just a tip jar and someone put a gold ring in it. We let the guitar player have it. He sold it and made a few bucks.
If you are playing a "paid gig"...
the tip jar might be a little tacky.
If someone hands you $5.00 to play a certain song, that's different. Take it.

I thought the going rate around here for "Mustang Sally" requests was minimum $100.00.
I like the concept of the 'situational' tip jar. But that doesn't speak to the OP's issue, which I think was communication with his bandmates.
GTR: "Hey guys, I'd like to play HOSTS party as a favor to them."
BAND: "You know we need $____ per person, especially to cover gas, gear wear and tear and so forth."
GTR: "I said we'd do it for $300.00."
BAND: "Maybe you will do it for that, but we won't. Here are the options you have:
Contact the HOSTS and explain that the fee you negotiated was not agreed to or sufficient for the other band members since you was never authorized to commit to that fee on our behalf to begin with without our consent.
HOSTS will have to either:
(a) Pay more for this with or without a tip jar;
(b) Find another band that will play for that pay scale. "
So the tip jar is pretty far back in the options that way.
An alternative scenario for this 6 piece band would for the GTR to say to the HOSTS right up front, "The band usaully gets (let's say 1200) for a gig like this, but I will be happy to discount my portion (200) as a
professional courtesy".
So he can donate his service to his friends, the HOSTS if he likes, but you are certainly not obligated to do so.
With that understanding for doing gigs for friends as a policy, the tip jar issue becomes kind of moot. Or you could just ask. In this situation I would not have put one out though, if the agreement was made in advance to the pay. It seems that the tip jar was only an issue as the gig was underpaid.
It also sets a precedent for when the drummer's sister, or horn players cousin wants a party. Then the drummer says "We did HOSTS party for $300.00 and this is my sister, she's family!" Then you're screwed.
So from now on, agree everyone gets paid except for the individual(s) that choose to donate or discount their own service.
The last party I was at that had private bands, 2 of them, the sound guy alone made 4 times that.
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Re the post about the guy who was going to put out the tip jar to recoup the band pay, I find that pretty disgusting. If you want a party with a band, expect to pay for the service. If not, don't buy what you can't afford.
Also, an unwanted tip story ... One time I was in Boston for a trade convention. Usually I take a guitar so I can play when I get bored or jonesed out.
Anyway, I am at the Parker House (rather snooty

) and I went down to the lobby to play there so as not to disturb people on my floor. 10PM on a Saturday night. Date night. Security throws me out of there in about 30 seconds. "You can't play that here!" Ok. (One of the better places I have been thrown out of, don't even ASK about the Renaissance.)
So, I hoof it next door and there is a ministry in a store front and the entrance is trapezoidal, just like a stage, kind of a horn shape. Perfect. I whip out the 12 string and start my workout.
A guy comes by with a pretty girl on his arm, and he tries to give me 5 bucks. My case is not open and I refuse. I realized I am now making him look bad in front of this hot date he is trying to impress, so I tell him, "ok, but I'm gonna give it to the food bank". Help a bro out to hook up, you know. So I open the case, and people randomly walk by and throw money in.
At the end of an hour or two I had 50 bucks or so, and I gave it all to the RI Food Bank (Feeding America).
Now I have made it a habit than rather to refuse donations, I try to be gracious about it and give any of them to the Food Bank. That assuages any minor guilt I might have about taking anyones cash as I just put it toward a good cause.
Mustang Sally is still 100 bucks though. You can feed a lot of people with that.