Food Service Charges

[TeeDee]

Just a quick Forum census of thoughts/feelings - what are peoples thoughts regarding Service Charges placed on Meals by establishments?

That is , these are not Tips offered by the discretion of the Customer for ( subjective ) " Good Service " - But mandatory charges preinstalled by the eating establishment.

" Service charge is a charge levied by the restaurant for the service provided to customers. It’s like compulsory tips. It’s commonly charged at 5%-20% of the bill and the restaurant owner is free to charge whatever amount they want. "


Who pays happily and Who quibbles ??

 

[Van-Wild]

I pay a tip in cash, to the server if I feel they have done something that is not required of them in their job description. For example, being nice to the customer is expected, I don't tip for that, nor do I tip for wiping the table down or offering more drinks..... thats all part of the job isnt it? So I don't tip for that.

I do appreciate it when the server treats my children like customers and engages with them. Thats nice. It gives my kids a good experience doesnt it and they don't have to do that. I do tip for that.

But I always tip in cash to the server. They earned it. A service charge is a rip off, an Americanism that compensates for poor pay of the restaurant staff, if it even goes to them.......

Sent from my SM-G970F using Tapatalk

 

[bigbear]

Yup, its totally wrong if serving staff need tips to make their pay worthwhile. They should get a living wage, and we should be happy to pay prices which support that.
A tip is to reward someone who has tried that bit harder, and I tip often, but have no qualms about not doing so if service is poor. I deplore the US system of a tip being expected. Pay your staff properly, be upfront about that and encourage tipping as a Thank you.

 

[Fadcode]

its basically like supporting slavery, the staff will never reach the point where they receive a good wage, if you go into ASDA, Tesco, on a train or bus etc, and receive good service you are not expected to give the people a tip,
It's worse in the USA than jere where a lot of low paid workers actually rely on their tips to a greater extent than here.
The service charge is a big con, and very rarely goes to the staff who serve you.

 

[TeeDee]

its basically like supporting slavery, the staff will never reach the point where they receive a good wage, if you go into ASDA, Tesco, on a train or bus etc, and receive good service you are not expected to give the people a tip,
It's worse in the USA than jere where a lot of low paid workers actually rely on their tips to a greater extent than here.
The service charge is a big con, and very rarely goes to the staff who serve you.

.

Dunno if I can agree with is bit , " its basically like supporting slavery, "

I'm just not much of a fan. Especially when its not clear that its not sufficiently advertised BEFORE you sit down for the meal.

 

[TeeDee]

Just had a recent exchange of opinion and point of commercial debate reference this - I find it quite underhanded to include it into a bill as standard.

 

[plastic-ninja]

In the UK at least, the addition of a service charge must be on the menu, so if you really object to paying it you are perfectly entitled to change your mind and leave. You are also legally entitled to refuse to pay the service charge. I have refused several times in expensive restaurants where I have received poor service or food. It generally doesn't go down too well but you are entitled to do it entirely at your own discretion with no explanation to the restaurant.
It is not true, in the UK at least, that service charges do not go to the staff. Service charges, and tips too, are usually pooled amongst all the staff EXCEPT Owners/Directors, and shared out in agreed proportions related usually to shifts/hours worked. Tips are outside the PAYE arrangements too, as long as the division of them amongst the staff is not done by Management or included in their pay packet.
I have a cocktail bar where we do not add a service charge, just having a jar on the counter for gratuities from customers. The front of house staff sort out tips once a month according to hours worked.
I'm not a massive fan of the service charge system, however I can see that our almost cashless society often doesn't give tips unless they are included when they pay by card. My staff lose out because of this. They give great service way beyond their job description requirements and they do deserve the extra that I can't afford to pay them.
I can also see the sense in the service charge over tipping any individual waiter in cash. If you tip in cash and the server just pockets it, you are not recognising the contribution of the other staff who made your evening exceptional. The barman who prepared your Martinis, the chef who prepared your food, the reception staff who greeted you by name and remembered the names of your kids from last time, etc, etc. All the staff worked as a team to make your evening special but only one of them is being recognised for it. Hopefully the waiter will share the tips with the rest of the staff, but there is pressure on them to keep it for themselves which causes tension and resentment especially in the kitchen.
All I'm saying is it's not just greedy bosses pocketing an extra (typically in the UK) 12.5%. If you don't feel you've had good value at the total they ask you to pay just deduct the service charge. Tips cause lots of problems when they are paid to individuals. Service charges are generally fairer to the staff and much easier to oversee with regard to the current legislation. It's not as simple as it looks at first glance.

 

[TeeDee]

In the UK at least, the addition of a service charge must be on the menu, so if you really object to paying it you are perfectly entitled to change your mind and leave. You are also legally entitled to refuse to pay the service charge. I have refused several times in expensive restaurants where I have received poor service or food. It generally doesn't go down too well but you are entitled to do it entirely at your own discretion with no explanation to the restaurant.
It is not true, in the UK at least, that service charges do not go to the staff. Service charges, and tips too, are usually pooled amongst all the staff EXCEPT Owners/Directors, and shared out in agreed proportions related usually to shifts/hours worked. Tips are outside the PAYE arrangements too, as long as the division of them amongst the staff is not done by Management or included in their pay packet.
I have a cocktail bar where we do not add a service charge, just having a jar on the counter for gratuities from customers. The front of house staff sort out tips once a month according to hours worked.
I'm not a massive fan of the service charge system, however I can see that our almost cashless society often doesn't give tips unless they are included when they pay by card. My staff lose out because of this. They give great service way beyond their job description requirements and they do deserve the extra that I can't afford to pay them.
I can also see the sense in the service charge over tipping any individual waiter in cash. If you tip in cash and the server just pockets it, you are not recognising the contribution of the other staff who made your evening exceptional. The barman who prepared your Martinis, the chef who prepared your food, the reception staff who greeted you by name and remembered the names of your kids from last time, etc, etc. All the staff worked as a team to make your evening special but only one of them is being recognised for it. Hopefully the waiter will share the tips with the rest of the staff, but there is pressure on them to keep it for themselves which causes tension and resentment especially in the kitchen.
All I'm saying is it's not just greedy bosses pocketing an extra (typically in the UK) 12.5%. If you don't feel you've had good value at the total they ask you to pay just deduct the service charge. Tips cause lots of problems when they are paid to individuals. Service charges are generally fairer to the staff and much easier to oversee with regard to the current legislation. It's not as simple as it looks at first glance.

Thank You.

Just with regards t this bit :-

" My staff lose out because of this. They give great service way beyond their job description requirements and they do deserve the extra that I can't afford to pay them. "

So what is they wage you pay your staff then? I'm just trying to wrap my head around why this sector should be any different to any other sector? IE Free Market Economy making it competitive and Paying a Fair/True wage?

Why does this industry need a 'top up' from customers rather than just have it included within the price of drinks and meals?

I'm sure umbrage would be felt if there was a service charge included in other normal low paying sectors and industries?

Thank you for taking the time to reply.

 

[Ed the Ted]

Nowhere where I live has this, we are old school. However when I am away in Croatia where my partner is from I firmly believe in generous tipping, in cash, to the waiter/waitress themselves. Their pay is pitiful and this kind of work is only viable for most in the tourist season... with youth unemployment and more worryingly a considerable exodus of young people for work, and my privilege to be born in an economically and politically stable country, it is altogether backwards to be happy to pay hundreds to an airline, but refuse to give an extra fiver to the seasonal worker who might have no other income. However, I don't trust most service sector bosses (sorry) to not pocket a formal service charge (or even a cash tip). In the UK because prices are higher, I generally don't tip because I can't afford it. My income is minimum wage, not even living wage, so i don't have the spare cash to tip, but at least I know that minimum wage here is a little better than elsewhere where the economic situation is a little more strained.

 

[plastic-ninja]

Thank You.

Just with regards t this bit :-

" My staff lose out because of this. They give great service way beyond their job description requirements and they do deserve the extra that I can't afford to pay them. "

So what is they wage you pay your staff then? I'm just trying to wrap my head around why this sector should be any different to any other sector? IE Free Market Economy making it competitive and Paying a Fair/True wage?

Why does this industry need a 'top up' from customers rather than just have it included within the price of drinks and meals?

I'm sure umbrage would be felt if there was a service charge included in other normal low paying sectors and industries?

Thank you for taking the time to reply.

My staff get 10:50 an hour. However they aren't working full time for me as we are only open at weekends so they all work elsewhere too.
The service charge or the tip in cash is an accepted way to recognise the staff for going the extra mile to make your experience memorable and making you feel really special. Most people will tip a taxi driver just for conveying them from A to B without a second thought, in fact they expect it with the exception of Uber drivers. Most workers do their job within the job description to the best of their ability. Technically my staff's job is to greet you, take you to a table, furnish you with a menu, water and snacks, take your order and deliver your drinks. If that was all they did I don't think we'd be very busy and few would return for a second time. They don't get paid for having the conversation with you about your day, your mood, your holidays, your kids, etc or for making recommendations on where to eat after your drinks, making reservations for you, calling taxis, finding out about your drinking style and recommending drinks you'll like when there is nothing you fancy on the menu.
Service staff are a special case. When they go above and beyond the call of duty they are not just doing their job : they are making you feel special and making your evening better in a huge way.
All sorts of workers get "tips". My mum used to tip the bin men at Christmas! Many get a Christmas bonus from their employer which is payable because he has charged you, the customer, a little more than he absolutely needed to to make a profit. Kids give teachers presents at Christmas and when they leave school, or when the teacher retires. Anyone in a sales job is well-used to target-related bonuses for extra effort. Many executives get "perks" like cars, phones, foreign holidays. Politicians get loads of extras above and beyond their generous salaries.
My staff earn every penny of their tips, unlike many workers who just expect bonuses to be paid every year regardless of their personal input.
My point is that you are paying service charges all the time, but in some cases the employees will only get a small percentage of it, upper management will take a share too and you will never know if your great online review was recognised for that employee or not. The service charge system is open and closely regulated to keep it in the hands of the workers themselves, as are tips when properly organised.
I can't speak for the USA but their service charges seem to be around 20% in my industry. You do generally get AMAZING service in the US though.
Simon

 

[plastic-ninja]

Nowhere where I live has this, we are old school. However when I am away in Croatia where my partner is from I firmly believe in generous tipping, in cash, to the waiter/waitress themselves. Their pay is pitiful and this kind of work is only viable for most in the tourist season... with youth unemployment and more worryingly a considerable exodus of young people for work, and my privilege to be born in an economically and politically stable country, it is altogether backwards to be happy to pay hundreds to an airline, but refuse to give an extra fiver to the seasonal worker who might have no other income. However, I don't trust most service sector bosses (sorry) to not pocket a formal service charge (or even a cash tip). In the UK because prices are higher, I generally don't tip because I can't afford it. My income is minimum wage, not even living wage, so i don't have the spare cash to tip, but at least I know that minimum wage here is a little better than elsewhere where the economic situation is a little more strained.

I totally understand your point of view but you are wrong not to trust service sector bosses to pass the money on to the workforce. I can tell you from personal experience that the legislation surrounding service charges and gratuities is complex and transparent. The employees appoint one of their own to administer the scheme without any input from me. I don't get any tips even though I work every shift as a bartender, so any gratuities aimed at me are put in the jar for the staff. Before you say that I'm enjoying the profits/salary of management please note that I don't get any money until everyone else has had theirs and I have yet to earn enough to pay income tax for the last two years.

 

[TeeDee]

My staff get 10:50 an hour. However they aren't working full time for me as we are only open at weekends so they all work elsewhere too.
The service charge or the tip in cash is an accepted way to recognise the staff for going the extra mile to make your experience memorable and making you feel really special. Most people will tip a taxi driver just for conveying them from A to B without a second thought, in fact they expect it with the exception of Uber drivers. Most workers do their job within the job description to the best of their ability. Technically my staff's job is to greet you, take you to a table, furnish you with a menu, water and snacks, take your order and deliver your drinks. If that was all they did I don't think we'd be very busy and few would return for a second time. They don't get paid for having the conversation with you about your day, your mood, your holidays, your kids, etc or for making recommendations on where to eat after your drinks, making reservations for you, calling taxis, finding out about your drinking style and recommending drinks you'll like when there is nothing you fancy on the menu.
Service staff are a special case. When they go above and beyond the call of duty they are not just doing their job : they are making you feel special and making your evening better in a huge way.
All sorts of workers get "tips". My mum used to tip the bin men at Christmas! Many get a Christmas bonus from their employer which is payable because he has charged you, the customer, a little more than he absolutely needed to to make a profit. Kids give teachers presents at Christmas and when they leave school, or when the teacher retires. Anyone in a sales job is well-used to target-related bonuses for extra effort. Many executives get "perks" like cars, phones, foreign holidays. Politicians get loads of extras above and beyond their generous salaries.
My staff earn every penny of their tips, unlike many workers who just expect bonuses to be paid every year regardless of their personal input.
My point is that you are paying service charges all the time, but in some cases the employees will only get a small percentage of it, upper management will take a share too and you will never know if your great online review was recognised for that employee or not. The service charge system is open and closely regulated to keep it in the hands of the workers themselves, as are tips when properly organised.
I can't speak for the USA but their service charges seem to be around 20% in my industry. You do generally get AMAZING service in the US though.
Simon

Thank you again for a detailed reply. I should make it clear I have NO issue with Tipping in general. What I have an issue with is Mandatory Service Charges being fixed to the bill.

If you feel I maybe arguing semantics , I would respectfully disagree - I started the thread regarding Service Charges , but its thread drifted to Tipping in general. To clarify the question I raised was regarding the automatic addition of Service Charges to bills. It simply doesn't take into account for the customer if YOU ( as the customer ) received good and attentive service.

I appreciate what you say regarding your staff working hard and delivering over and beyond and I have no doubt if I was served by them I would feel thus inclined to Tip. That would be my decision at the Time. If you feel they all and every time deserve their additional payment then I would suggest respectfully thats a different issue.

The downside I see of the automatic Service Charge ( if it gains traction ) is that staff could see no reason for being hospitable and welcoming. I've also experienced that type of service before from serving staff and obviously then they DON'T get a tip.

Hope that clarifies it. I'm PRO Tipping ( where justified ) , I'm CON automatic additional Toll for choosing to give my custom to an establishment.

I guess its a bit like Pavlov's dog and associating positive experience and performance with Positive Rewards - With fixed Service charges I don't see how people create their own motivation.

 

[Ed the Ted]

I totally understand your point of view but you are wrong not to trust service sector bosses to pass the money on to the workforce. I can tell you from personal experience that the legislation surrounding service charges and gratuities is complex and transparent. The employees appoint one of their own to administer the scheme without any input from me. I don't get any tips even though I work every shift as a bartender, so any gratuities aimed at me are put in the jar for the staff. Before you say that I'm enjoying the profits/salary of management please note that I don't get any money until everyone else has had theirs and I have yet to earn enough to pay income tax for the last two years.

I don't doubt it, I meant in the tourism industry in less-regulated economies, where it is common for bosses ( to exploit the lack of regulation) to shaft staff. My partner managed the trip advisor number 1 wine bar in dubrovnik for 2 years, as you can imagine this was a very successful place with a big turnover for a tiny bar in an alleyway. The way the tills and purses are managed there is quite different to the UK i believe (each worker has a sort of mini till on their belt), and the workers are basically living on the tips, that is their primary source of income. So if it starts going through the till in card payments, or into another workers purse or the managers purse, it is very likely they will never see the tips. The mindset is the classical capitalism-fetishism, the belief that any regulation will cripple the industry and everyone will lose out, but in reality it creates an atmosphere where the economically strong dominate and exploit the economically weak, regardless of how many millions of tourists come by each year.

Oh and the purse system means that any discrepancies (ie. human error mistakes) between purses and bills can be blamed on the workers and so the management isn't liable for any fines for not declaring trade, because it can be made to look like the servers were not declaring such and such in order to pocket the cash.

So when I see my bill I give at least 10%, in cash, directly into the hand of the waiter/waitress, and I thank them for their time, and silently I thank the gods that I don't have to live quite such a precarious life.

ps it is very reassuring to hear from you that service charges are operated independently of management and are not just a sneaky scheme, so thanks for that information!

 

[Ed the Ted]

The downside I see of the automatic Service Charge ( if it gains traction ) is that staff could see no reason for being hospitable and welcoming. I've also experienced that type of service before from serving staff and obviously then they DON'T get a tip.

People who work in service are entitled to have a bad day. I work alone, and when i'm feeling miserable I don't have to put on a fake smile for anyone. Maybe it is more humane to think 'something must have ruined this persons day, I hope it improves', or 'maybe something awful just happened in this persons life, but they don't have the option to not come to this shitty minimum wage job because they are on a 0 hour contract and have no job security'. Or something like that.

 

[TeeDee]

All sorts of workers get "tips". My mum used to tip the bin men at Christmas! Many get a Christmas bonus from their employer which is payable because he has charged you, the customer, a little more than he absolutely needed to to make a profit. Kids give teachers presents at Christmas and when they leave school, or when the teacher retires. Anyone in a sales job is well-used to target-related bonuses for extra effort. Many executives get "perks" like cars, phones, foreign holidays. Politicians get loads of extras above and beyond their generous salaries.

Binmen don't get a Tip each time they collect the bins however do they? Or maybe others do tip them and I'm a miser.

Sales jobs - They are explained at the start that its performance related pay ( emphasis on the performance ) that contribute to their pay structure .

 

[TeeDee]

People who work in service are entitled to have a bad day. I work alone, and when i'm feeling miserable I don't have to put on a fake smile for anyone. Maybe it is more humane to think 'something must have ruined this persons day, I hope it improves', or 'maybe something awful just happened in this persons life, but they don't have the option to not come to this shitty minimum wage job because they are on a 0 hour contract and have no job security'. Or something like that.

Everyone is entitled to a bad day - don't think thats up for a dispute.

 

[Mesquite]

ps it is very reassuring to hear from you that service charges are operated independently of management and are not just a sneaky scheme, so thanks for that information!

Some service charges are operated independently of management but not all.

There's been a number of examples where the management have taken a significant 'admin fee' for processing electronic gratuities before passing the remainder on their staff.

The places I frequent usually levy a service charge for large parties over a certain amount, usually 6 or 8 people and that's clearly indicated on the menu. I've no qualms with that but I'd certainly argue the payment of it were I to get poor service and they didn't do anything to sort it out after being told.

 

[TeeDee]

The places I frequent usually levy a service charge for large parties over a certain amount, usually 6 or 8 people and that's clearly indicated on the menu. I've no qualms with that but I'd certainly argue the payment of it were I to get poor service and they didn't do anything to sort it out after being told.

I maybe wrong - but I thought the price ratio for food production for a restaurant or similar establishment was 1/3 Actual Produce Costs , 1/3 Premise Costs and Rates & Labour , 1/3 Profit Margin.

If there has already been a proportion set aside for Labour then that needs to increase if its already factored in yet doesn't cover the over labour costs.

Again - I See tipping as an over and beyond gratuity for excellence in hospitality.

 

[Wayne]

I’m not a fan of service charges. I think the price quoted on the menu should be the price paid by the consumer.
wages should be cover by the manage of the business not an additional levy

 

[plastic-ninja]

Binmen don't get a Tip each time they collect the bins however do they? Or maybe others do tip them and I'm a miser.

Sales jobs - They are explained at the start that its performance related pay ( emphasis on the performance ) that contribute to their pay structure .

Can't believe you don't tip the binmen! Tightwad!