Cedarhurst-
I didn’t say that I personally withhold part or all of a tip based on poor service – I said that doing so is legitimate.
“WolfishMusings” did a pretty good job of explaining my thinking – a full tip is compensation for a job fully and properly done. An incomplete job (poor or rude service) gets an incomplete tip. This is the way tipping works in society – the tip is the customer’s leverage to get good service. I’m not sure if this is a precise analogy, but we learn in Nezikin that we follow the minhag of where you are when it comes to what type of payment is expected and to what that payment entitles the payer.
Your question is more suited to a “tipping mandatory” policy, which many restaurants institute for parties over a certain size. In that case I would agree with your point, that withholding a tip based on poor service isn’t an option. I would complain to the manager or owner to see if they would waive the tip or offer some other form of compensation.