3% surcharge in restaurant, but "keep tipping as usual"
May 14, 2019, 7:39 am
#16
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Join Date: Mar 2019
Posts: 18,036
Now if anyone can tell me that the text directly above is not meaningless nonsense then I would love to hear that argument.
https://www.karlstrauss.com/surcharge/
May 14, 2019, 7:40 am
#17
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Join Date: Mar 2019
Posts: 18,036
In what seems to be a trend, the restaurant had a 3% surcharge. I've seen it before, and this restaurant specifically said it was for helping with the increase in wage (new state minimum wage laws). But after it it noted that this is not a gratuity and should not affect the amount you tip.
Really?
Why not?
People no longer tip just because of good service. If you meant for "great service" or "going above and beyond", which I presume what is the original intent of tipping, yes, that should not change. But nobody tips for that reason anymore. People tip (I mean in the US) because there is an expectation, because waiters hound you for it (sometimes chasing you out the door), and (for many) because you feel they don't make enough to get by.
But if their wage increases, why shouldn't the tip decrease?
Is it only people with lots of disposable income that should eat in restaurants? Who shouldn't mind paying an extra 3 or 5% of their bill because of these nonsensical costs, and still should "tip generously" because ... Since when is tipping considered a charitable donation?
Really?
Why not?
People no longer tip just because of good service. If you meant for "great service" or "going above and beyond", which I presume what is the original intent of tipping, yes, that should not change. But nobody tips for that reason anymore. People tip (I mean in the US) because there is an expectation, because waiters hound you for it (sometimes chasing you out the door), and (for many) because you feel they don't make enough to get by.
But if their wage increases, why shouldn't the tip decrease?
Is it only people with lots of disposable income that should eat in restaurants? Who shouldn't mind paying an extra 3 or 5% of their bill because of these nonsensical costs, and still should "tip generously" because ... Since when is tipping considered a charitable donation?
May 14, 2019, 7:41 am
#18
Join Date: Oct 2011
Location: Everywhere and Nowhere
Programs: Global Mercenary
Posts: 193
May 14, 2019, 7:59 am
#21
Original Poster
Join Date: Sep 2008
Posts: 7,875
Servers these days are typically tipping out anywhere from 8-12% of their SALES to the house regardless if they actually got tipped or not sometimes meaning if they don’t get tipped on a large bill they are essentially paying to be at work.
Employers then use the house tip to pay managers, porters/bussers, kitchen staff etc. Servers either pool the leftover few percent and split evenly amongst themselves or keep for themselves. Any additional tip over a mandatory service charge /auto-gratuity displayed on the bill is a true tip of which 100% would go to the server.
Here’s an example:
Food and drink = $300
18 per cent service charge = $45.00
5 per cent tax = $17.25
Total $362.25
Restaurant
House Tipout of 8% of net sales including tax
Porter Tipout 3% of net sales including tax
11% of ($300+$17.25) = $34.90
Server tips out $34.90 to house/porter regardless of whether or not she got tipped on top of the bill. From the $45.00 total “service charge” added to your bill your server will receive $10.10
$10.10 of a $300 bill is 3 percent. So essentially your server makes 3% on her net sales.
I always tip 15 or 20% on top of the final bill which leaves the server personally with the tip plus she gets the 3% from service charge.
Basically restaurant food costs and expenses have increased greatly over the past few years and prices have not really been inflated appropriately to adjust for this. If a restaurant needs to charge $20 a meal to breakeven or be profitable, instead of just charging $20 for that dish as would be the proper thing to do, they instead write a menu price of $15 add the tax and the service charge which goes back to them and that $20 lunch doesn’t seem so bad on a menu at $15. This is their theory.
Meanwhile servers are the ones who have to take the fault for making you feel like you should tip on top of a service/auto-gratuity. It is because autograt/service charge on a bill isn’t a real tip, it’s money collected by the restaurant itself disguised as such.
Employers then use the house tip to pay managers, porters/bussers, kitchen staff etc. Servers either pool the leftover few percent and split evenly amongst themselves or keep for themselves. Any additional tip over a mandatory service charge /auto-gratuity displayed on the bill is a true tip of which 100% would go to the server.
Here’s an example:
Food and drink = $300
18 per cent service charge = $45.00
5 per cent tax = $17.25
Total $362.25
Restaurant
House Tipout of 8% of net sales including tax
Porter Tipout 3% of net sales including tax
11% of ($300+$17.25) = $34.90
Server tips out $34.90 to house/porter regardless of whether or not she got tipped on top of the bill. From the $45.00 total “service charge” added to your bill your server will receive $10.10
$10.10 of a $300 bill is 3 percent. So essentially your server makes 3% on her net sales.
I always tip 15 or 20% on top of the final bill which leaves the server personally with the tip plus she gets the 3% from service charge.
Basically restaurant food costs and expenses have increased greatly over the past few years and prices have not really been inflated appropriately to adjust for this. If a restaurant needs to charge $20 a meal to breakeven or be profitable, instead of just charging $20 for that dish as would be the proper thing to do, they instead write a menu price of $15 add the tax and the service charge which goes back to them and that $20 lunch doesn’t seem so bad on a menu at $15. This is their theory.
Meanwhile servers are the ones who have to take the fault for making you feel like you should tip on top of a service/auto-gratuity. It is because autograt/service charge on a bill isn’t a real tip, it’s money collected by the restaurant itself disguised as such.
Is it your opinion waiters should earn 6 figures annually?
May 14, 2019, 8:12 am
#22
Join Date: May 2009
Location: South Park, CO
Programs: Tegridy Elite
Posts: 5,678
The restaurant business clearly has a lot to learn from the airline business.
Unbundled dining concept: the price of the dishes only covers the dishes themselves, the service charge is the YQ.
Basic dining? No problem, but expect a table by the door or the toilet. Better table? Just select your table for 20, 40, or 100$.
Did you bring a jacket? Sorry, it can't hang from the chair, but the coat check is free with the Dining+ package (which also includes breadsticks) or with the restaurant branded credit card (use of the credit card to pay the bill incurs in surcharges).
Obviously cancellation of your reservation is not possible (surely you understand), but you can purchase our insurance which will refund 10% of the mandatory charge in case of death of the main diner only.
Thank you for choosing to dine with us!
Unbundled dining concept: the price of the dishes only covers the dishes themselves, the service charge is the YQ.
Basic dining? No problem, but expect a table by the door or the toilet. Better table? Just select your table for 20, 40, or 100$.
Did you bring a jacket? Sorry, it can't hang from the chair, but the coat check is free with the Dining+ package (which also includes breadsticks) or with the restaurant branded credit card (use of the credit card to pay the bill incurs in surcharges).
Obviously cancellation of your reservation is not possible (surely you understand), but you can purchase our insurance which will refund 10% of the mandatory charge in case of death of the main diner only.
Thank you for choosing to dine with us!
I would go a step further with the Basic Dining only guranteeing you a seat - which may be randomly assigned to an empty chair at another party's table...and no guarantee your party of 4 will be seated together!Friends of mine recently made their first ever visit to the US. Despite me warning and advising them, they were shocked when exposed to the 'tipping and prices excluding tax' culture of dining in the US. It became exceedingly frustrating for them, to the point they decided to live off junkfood for the few days they had in Miami after a caribbean cruise.
Having visited numerous times I've grown used to it, but never understood why it's necessary to have such a convoluted process of paying restaurant staff. FFS, give them a living wage and dispense with the idiotic "mandatory" tipping.
Having visited numerous times I've grown used to it, but never understood why it's necessary to have such a convoluted process of paying restaurant staff. FFS, give them a living wage and dispense with the idiotic "mandatory" tipping.
It would be slightly more convenient to see tax-inclusive prices on store shelves. But it's not hard to approximate the final in your head especially once you know the rate in a given location where you're staying. And even easier to figure it out on your phone calculator if the exact amount matters before purchasing.
None of the above should ruin anyone's vacation for heaven's sake! Other than restaurants and some hotel staff, there aren't really any other tipping situations the average tourist would encounter. It's funny how people are quick to advise tourists to be open and adapt to local culture and customs (which is good advice), except when visiting the US where it's OK to whine and complain that everything is wrong.
It is sour grapes - and as obnoxious as the "facility surcharge" that some non-resort hotels are starting to add on (not that "resort fees" are any less ridiculous).
May 14, 2019, 8:15 am
#23
Join Date: Sep 2014
Location: TPA/DFW/K15
Programs: AA EXP, Mar AMB, HH LT DIA
Posts: 1,653
Servers these days are typically tipping out anywhere from 8-12% of their SALES to the house regardless if they actually got tipped or not sometimes meaning if they don’t get tipped on a large bill they are essentially paying to be at work.
Employers then use the house tip to pay managers, porters/bussers, kitchen staff etc. Servers either pool the leftover few percent and split evenly amongst themselves or keep for themselves. Any additional tip over a mandatory service charge /auto-gratuity displayed on the bill is a true tip of which 100% would go to the server.
Here’s an example:
Food and drink = $300
18 per cent service charge = $54.00
5 per cent tax = $17.25Total $362.25
Restaurant
House Tipout of 8% of net sales including tax
Porter Tipout 3% of net sales including tax
11% of ($300+$17.25) = $34.90
Server tips out $34.90 to house/porter regardless of whether or not she got tipped on top of the bill. From the $54.00 total “service charge” added to your bill your server will receive $19.10
$19.10 of a $300 bill is 6 percent. So essentially your server makes 6% on her net sales.
I always tip 15 or 20% on top of the final bill which leaves the server personally with the tip plus she gets the 3% from service charge.
Basically restaurant food costs and expenses have increased greatly over the past few years and prices have not really been inflated appropriately to adjust for this. If a restaurant needs to charge $20 a meal to breakeven or be profitable, instead of just charging $20 for that dish as would be the proper thing to do, they instead write a menu price of $15 add the tax and the service charge which goes back to them and that $20 lunch doesn’t seem so bad on a menu at $15. This is their theory.
Meanwhile servers are the ones who have to take the fault for making you feel like you should tip on top of a service/auto-gratuity. It is because autograt/service charge on a bill isn’t a real tip, it’s money collected by the restaurant itself disguised as such.
Employers then use the house tip to pay managers, porters/bussers, kitchen staff etc. Servers either pool the leftover few percent and split evenly amongst themselves or keep for themselves. Any additional tip over a mandatory service charge /auto-gratuity displayed on the bill is a true tip of which 100% would go to the server.
Here’s an example:
Food and drink = $300
18 per cent service charge = $54.00
5 per cent tax = $17.25Total $362.25
Restaurant
House Tipout of 8% of net sales including tax
Porter Tipout 3% of net sales including tax
11% of ($300+$17.25) = $34.90
Server tips out $34.90 to house/porter regardless of whether or not she got tipped on top of the bill. From the $54.00 total “service charge” added to your bill your server will receive $19.10
$19.10 of a $300 bill is 6 percent. So essentially your server makes 6% on her net sales.
I always tip 15 or 20% on top of the final bill which leaves the server personally with the tip plus she gets the 3% from service charge.
Basically restaurant food costs and expenses have increased greatly over the past few years and prices have not really been inflated appropriately to adjust for this. If a restaurant needs to charge $20 a meal to breakeven or be profitable, instead of just charging $20 for that dish as would be the proper thing to do, they instead write a menu price of $15 add the tax and the service charge which goes back to them and that $20 lunch doesn’t seem so bad on a menu at $15. This is their theory.
Meanwhile servers are the ones who have to take the fault for making you feel like you should tip on top of a service/auto-gratuity. It is because autograt/service charge on a bill isn’t a real tip, it’s money collected by the restaurant itself disguised as such.
May 14, 2019, 8:18 am
#24
Join Date: Apr 2016
Posts: 129
We have to save the fund the farmers who are ruining the atmosphere by taxing the food we eat, but only at restaurants. Huh? It is optional if you are able to catch it on your bill then wait around to remove it. What nonsense! NOPE, California is just plain nuts and I am living here, we are taxed and given fees to offset some made up political issue. No wonder retiree's are taking the pension and moving out of state.
California restaurants can now add a 1% surcharge to help fight climate change. (CNN) People eating out at California restaurants may start to see an optional 1%surcharge added to their bill. The money will go to a public fund that helps farmers who use practices that reduce carbon in the atmosphere.Apr 26, 2019
California restaurants can now add a 1% surcharge to help fight climate change. (CNN) People eating out at California restaurants may start to see an optional 1%surcharge added to their bill. The money will go to a public fund that helps farmers who use practices that reduce carbon in the atmosphere.Apr 26, 2019
May 14, 2019, 8:18 am
#25
Join Date: Jun 2015
Location: DTW
Programs: Alaska, Delta, Southwest
Posts: 1,663
Karl Strauss brewery in LA does this to cover staff costs and on their website they justify it is as follows:
and then further down in a Q and A:
Now if anyone can tell me that the text directly above is not meaningless nonsense then I would love to hear that argument.
https://www.karlstrauss.com/surcharge/
and then further down in a Q and A:
Now if anyone can tell me that the text directly above is not meaningless nonsense then I would love to hear that argument.
https://www.karlstrauss.com/surcharge/
They’re double dipping here by adding a service charge and still expecting tips. We all collectively need to vote with our wallets and put a stop to this before it becomes widespread, like hotel resort fees or airline fuel surcharges - seriously, what other industry could get away with such shenanigans as your airline ticket not including the fuel necessary to transport you, or the hotel automatically charging you for optional services whether you use them or not?
Ugh, now I’m riled up, sorry, but I love traveling and dining out, and I hate seeing it ruined by these shenanigans.
May 14, 2019, 8:55 am
#26
FlyerTalk Evangelist
Join Date: Jan 2009
Location: London & Sonoma CA
Programs: UA 1K, MM *G for life, BAEC Gold
Posts: 10,227
I think it’s worse than that - much like hotel resort fees, he’s advertising an artificially lower price than he’s actually charging, and explaining that it’s because of new laws and taxes is a thinly veiled attempt to push his political views on his customers. (He might be right, but I would still find that offputting as a customer.)
May 14, 2019, 9:27 am
#27
Join Date: Oct 2013
Location: ORD
Programs: UA Silver, Marriott Platinum/LT Platinum, Hilton Gold
Posts: 5,594
If restaurant owners want to make a political statement, they can do so without adding this obnxious service charge. Simply raise the menu prices and state at the bottom of the menu that they've raised the prices due to x, y, and/or z. Then customers can decide if they want to dine there or not, and they'll know the price (plus estimated tip) of a meal before they sit down. I'm sure servers would like that too.
The service charge is just a way to fool customers into paying more than they expected, because we're not used to seeing it in US restaurants.
Frankly, there's some good in the ticketing system many of the high end restaurants are moving toward. You buy your ticket in advance for a set menu, it already includes tax and tip, and you can make an informed decision about whether you want to pay that price to dine. No surprises.
The service charge is just a way to fool customers into paying more than they expected, because we're not used to seeing it in US restaurants.
Frankly, there's some good in the ticketing system many of the high end restaurants are moving toward. You buy your ticket in advance for a set menu, it already includes tax and tip, and you can make an informed decision about whether you want to pay that price to dine. No surprises.
May 14, 2019, 9:41 am
#28
Original Poster
Join Date: Sep 2008
Posts: 7,875
The US is far from the only country around the world with expectations of gratuities, and in fact the practice was imported from Europe in the mid 19th century. Would it be better to have a different arrangement? Maybe. Some servers who make excellent tips prefer it. Many others disagree. It won't change overnight, if at all.
None of the above should ruin anyone's vacation for heaven's sake! Other than restaurants and some hotel staff, there aren't really any other tipping situations the average tourist would encounter. It's funny how people are quick to advise tourists to be open and adapt to local culture and customs (which is good advice), except when visiting the US where it's OK to whine and complain that everything is wrong.
None of the above should ruin anyone's vacation for heaven's sake! Other than restaurants and some hotel staff, there aren't really any other tipping situations the average tourist would encounter. It's funny how people are quick to advise tourists to be open and adapt to local culture and customs (which is good advice), except when visiting the US where it's OK to whine and complain that everything is wrong.
May 14, 2019, 9:49 am
#29
Suspended
Join Date: Aug 2010
Location: DCA
Programs: UA US CO AA DL FL
Posts: 50,262
Restaurants adding surcharges are doing so to generate pressure on local officials not to raise the compensation of tipped staff. It is done this way as a means of showing local customers why their tab is increasing. Just as easy to increase menu prices as happens when other expenses such as good and rent increase.
But, don't mix & match your distaste for tipping with whether you tip in the US. If it is a better deal to eat dinner in Tokyo than New York, go to Tokyo.
But, don't mix & match your distaste for tipping with whether you tip in the US. If it is a better deal to eat dinner in Tokyo than New York, go to Tokyo.
May 14, 2019, 9:52 am
#30
FlyerTalk Evangelist
Join Date: Mar 2019
Posts: 18,036