High End Restaurants are Adding a Service Charge Beyond the Gratuity

I've never understood the huge tips one is supposed to give in the US, but that's the culture, so fine. In the UK (and over here) I leave 10%, if the service is good, although if everyone is doing their job properly, it's sometimes difficult to establish what's "good" and what's "outstanding".If it's not good, the waiters/waitresses get to know about it. One gastro-pub we went to last year took 10 minutes to bring us the menus; 4 of the 6 "specials" were not available, and then we waited 50 minutes to get served Fish & Chips. Every 5 minutes or so, a bloke in a chef's jacket would sneak out of the kitchen, down a glass of white wine, then sneak back in again.
No tip - and we told them exactly why.
I'd probably find it a bit confusing if I paid, say $100 for a meal, then had to pay 15% obligatory tips, then a 20% service charge. That means paying 35% more for the meal!
 
blades said:
As a merchant who accepts credit cards I can tell you that charging extra for a credit card transaction is a breech (not breche) of the contract. Also, most companies pay 2% or less for accepting a credit card transaction so 4% is skimming the public. I'm not aware of any company that pays 4% per transaction. Be straight with your customers. It is a better approach.
Click to expand...
That's what I always thought as well so I looked it up the first time it happened. Apparently a surcharge is no longer a breech in most places due to a class action lawsuit in Federal Court that ruled it was okay. Also, if it is called a "convenience fee," it's apparently okay to do.

I thought the 4% was a bit much as well, besides the fact that you have to tell them to take it off if you are paying cash. Agree that I'd rather pay a few cents more per food item and be done with it.
 
karadekoolaid said:
, say $100 for a meal, then had to pay 15% obligatory tips, then a 20% service charge. That means paying 35% more for the meal!
Click to expand...
In most restaurants that you'd be charged $100 for food for 2 people, you'd be expected to tip 20%, so you'd be shelling out $140 for the meal.

If we went to 1 of the nicer places we go to and were confronted with a 20% plus service fee just for the privilege of eating there, it would be the last time that restaurant would have the privilege of our business.

And also to clarify about tipping when you are with a larger party, in most restaurants in the US, parties of 6 or more have a 15% to 20% gratuity automatically added to their check, and it is noted on the menu, albeit usually in small print. You can, of course, add to that for exceptional service. You also can dispute that with management if you feel the service was substandard.
 
medtran49 said:
That's what I always thought as well so I looked it up the first time it happened. Apparently a surcharge is no longer a breech in most places due to a class action lawsuit in Federal Court that ruled it was okay. Also, if it is called a "convenience fee," it's apparently okay to do.

I thought the 4% was a bit much as well, besides the fact that you have to tell them to take it off if you are paying cash. Agree that I'd rather pay a few cents more per food item and be done with it.
Click to expand...
I know I can't do it. Perhaps I am not in one of those places. I wasn't aware of the lawsuit but I think it was properly decided. Companies like mine that operate on thin margins consider credit card fees when pricing products.
 
karadekoolaid said:
I've never understood the huge tips one is supposed to give in the US, but that's the culture, so fine.
Click to expand...

In Texas, the minimum wage an employer must pay a tipped worker is $2.13 per hour, as long as their tips bring the worker's total to $7.25 per hour. :eek: It is kinda' complicated, but the bottom line is that the combined total of $2.13 per hour and tips must equal the Federal minimum wage of a meager $7.25 per hour -- not enough to live on.

So, servers in restaurants here literally depend on generous tips to pay the rent, keep the lights on and buy food.

One political party is vehemently opposed to raising the minimum wage in the US above $7.25 per hour. I'll let you guess which one. :rolleyes:

I am a 20-percent tipper, unless the server does a bad job. I never punish the server for bad food. They didn't cook it. If I get bad food, but good service, I pay a 20-percent tip.

CD
 
Last edited:
PabloLerntKochen said:
I did read a few years ago, that some politicians tried to tax the tipmoney
Click to expand...
They do that in the US. Servers are taxed 8% of their sales in expectation they are making that much in tips on each bill. If the tip is on a credit card and they get a higher tip, they get taxed on the full amount of the tip. If someone stiffs them, however, they still get taxed the 8% on the bill amount.
 
PabloLerntKochen said:
That makes it even harder for quit quitters. No wonder they all come to Germany :D
Click to expand...

Yes PLK, tips are considered income. The average waiter pays more in Federal Income Taxes than Donald Trump does (that's not a joke).

CD
 
We booked a table at Red Lantern (Luke Nguyen) a few years ago for a group of friends who are all paying individually in cash at the end of the night into the middle of the table once the cheque has been divided by the 8 of us.

The menu was $80.00 a head. We all had a couple of drinks. We paid $125 each.

I’m pretty good at math so I was mildly confused.
What I found was they added 10% for groups of 8 or more. Basically another person could have eaten the deg for that surcharge.

I don’t get it? This was a Wednesday night. They weren’t busy. They basically punished us for daring to patronize their establishment.

I won’t go back.
 
Cash v card.

A lot of small businesses and a lot of the general public here are starting to get dirty on the cash thing. There were signs all over the hippy village of Kuranda in far north QLD saying “we accept cash”. “Keep cash alive”.

Last night I paid for a masala chai with cash and had a funny exchange with the proprietor about “dirty dirty cash”.

My favourite gelato place doesn’t take cash anymore. Card or pay via their app.

Pisses me off.
 
Breach, not breech.

Anyway... we don't do credit card fees or hide price hikes under undisclosed "service fees." The latter strikes me as terribly dishonest, and because we don't do that, there's a lot of grumbling about our high prices. We're fortunately in a near-monopoly situation, but if we were in a city and everyone around us was hiking their prices 20% but not showing that on the menu, I might have to reconsider my moral objections.
 
Frizz1974 said:
We booked a table at Red Lantern (Luke Nguyen) a few years ago for a group of friends who are all paying individually in cash at the end of the night into the middle of the table once the cheque has been divided by the 8 of us.

The menu was $80.00 a head. We all had a couple of drinks. We paid $125 each.

I’m pretty good at math so I was mildly confused.
What I found was they added 10% for groups of 8 or more. Basically another person could have eaten the deg for that surcharge.

I don’t get it? This was a Wednesday night. They weren’t busy. They basically punished us for daring to patronize their establishment.

I won’t go back.
Click to expand...

It's common practice in the States to charge an automatic gratuity for groups of 8 or more (some places do this for 6 or more). The idea there is that the restaurant doesn't want to put a lot of effort into the food service, only to have the large group leave without giving the server a tip.

I just heard about this recently, too: restaurants requiring an automatic tip for groups of teenagers without parents/guardians:

Restaurant adds automatic gratuity to bills of kids, teens
 
You must log in or register to reply here.
Back
Top Bottom