Forum Topic

Discrecretionary service charge ?

More and more restaurants are charging 12.5% extra on bills, I presume to cover "service" charges.  What "services" are they talking about?  Is this extra charge in order I wonder? I mean, when I go to a large shop to buy say a suit, I don't pay for extras like heating and lighting and air con and for the assistant to measure me. I pay the marked price for the suit only.Are we customers being cheated?

Gerry Tan ● 4958d53 Comments

Quite often it's those who wait upon us who are being cheated,low pay and poor conditions imo.

Keith Iddon ● 4958d

I suppose it helps people who have trouble working out a tip, or focuses the minds of those who tip stingily. In theory, it gives the waiter no incentive to make sure you are happy but in practice I find that places that charge it, such as Charlotte's, have excellent service anyway.You can ask for it to be removed but I would do that only if the service had been awful.

Susan Kelly ● 4958d

Just seen Keith's post. The best thing for waiters who are poorly paid and badly treated is to be tipped in cash. The restaurant has no legal obligation to pass service charges on to them!

Susan Kelly ● 4958d

That's what I quite often do  Susan.I always ask them if they get the service charge passed on to them.

Keith Iddon ● 4958d

I'm no lawyer but I think the situation is this. If the service charge is presented on the menu then it's an irritating add-on to the bill - like cover charges used to be. Point is, it isn't discretionary. Nor, as a previous poster has already said, is the restaurant required to pass it on to the staff.  However all that may be, if the service was awful it's definitely worth a go not paying it.I wouldn't go so far as to say cheated, but it's disingenuous of them not to display the whole price - like airline add-ons.  Having said that, I would be interested to hear from any restaurant owners as to how they see it.

David Bourne ● 4958d

I can just about put up with service charges in restaurants but what I really object to are pubs that serve food insisting on delivering drinks to the table rather than serving you at the bar, just so they can add service charges on your drinks as well as food.  Lets face it that's what pubs are there for to sell drinks and I don't think most people would expect additional service charges to be added to the cost of their pints or whatever.  Usually the largest part of your bill would be for wine/beer etc., and service charges on this really pee me off.

Bernadette Paul ● 4958d

Re: Point is, it isn't discretionary.Actually, it is.  You would be perfectly within your rights to deduct that amount from your bill.  I usually pay the cost of the meal by credit card and add my own discretionary tip separately as cash - which may or may not be 12.5%.  Some places are now adding 20% to the bill which is completely over the top.  But legally you are under no obligation to pay it should you choose not to.

Gail Clark ● 4958d

I have refused to pay it on a couple of occassions so I don't know where you get the idea that it is not discretionary.

Keith Iddon ● 4958d

Some restaurants write a smallprint notice, usually at the bottom of their menu that says:  "A dicretionary service charge of XX% will be added to your bill".Some restaurants don't seem to declare this extra charge any where.Some few restaurants pass this on to staff, both waiting staff and kitchen workers.I don't like the practise - I prefer to see exactly what an item or service charge is gonna be asked for delcared up-front, shown clearly and with no discretion about it. Then everyone knows where they stand and what is expected. No vagueness or deception or malintentent. Life should be simple. Or am I expecting too much of systems and people?

Gerry Tan ● 4958d

Swings and roundabouts, I reckon. If the service charge didn't exist, irrespective of whether it's optional or passed on to staff, prices would simply go up to make up the shortfall.

Alex Weel ● 4958d

I feel I ought to be able to tell by their demeanour if the waiters are unhappy because the bosses are greedy or just plain nasty. In which case, I'd probably stop going to the restaurant altogether. Of course, if they're all 'resting' actors ...

Susan Kelly ● 4958d

As I said, I'm not a lawyer but when the menu says "a blah% service charge will be added to the bill", the "will" looks decisive. Obviously if it says it's discretionary, that's different.

David Bourne ● 4957d

The tips are generally split among all staff to include the washer upper.  That's how they make their living. You can refuse but best not to go back. Heavens knows what may be in the sauce.

Charles Campbell ● 4957d

Yes and no...  Also - I think that there are inferences to be drawn from the fact that most people would tip at a rate of 10% but most services charges start at 12.5%.I have seen 15% but never as high as the 20% quoted elsewhere in the thread.Like Gerry, I don't like them - preferring instead to tip as I wish.What I do find more understandable / acceptable is the "a service charge of 12.5% will be added for parties of 6 or more" type of announcements on the menu.(Although now I come to analyse why I feel like this I cannot quite understand why I find it more readily acceptable...)

Tony Colliver ● 4957d

The law was changed a few years ago making it illegal for restaurants to use a service charge to subsidise staff wages. Up until then things were much worse, and it was common practice for establishments to effectively be paying BELOW minimum wage, and using service charges to bring their staff's income up to minimum wage.But it's still not guaranteed that service charges are actually paid to waiting/kitchen staff, and companies are not legally obliged to distribute all of it to them. So yes, the best thing is either to ASK the staff if the service charge goes to them, and if they are unable or unwilling to divulge, simply ask for the service charge to be removed from the bill, and leave a cash tip (if you are so inclined).

M Duley ● 4957d

Your close.  Tipping was not allowed to top up wages to the minimum wage level, but can still be used to increase their income after the minimum wage.  This is how I undestand it from a report from 2010.

Charles Campbell ● 4957d

Well done Gerry.Nice Topic and I feel drawn to make Comment. The Service Charge if not Illegal should be made so.The Menu price is the only Charge that should be payable. Tipping the Waiter is a matter one chooses to do.I have visited Australia several Times over the Years and I am glad to tell you that Tipping the waiter is frowned upon even by the Waiters.I thought it was a common practice and I left a Tip for the excellent service i received at a Hotel in Freemantle Perth,  and I was politely told it was not a practice in Australia, but should i desire to contribute towards a local charity I could drop the Tip into the collection box at the Exit.I was pleased and impressed and wondered if it was generally followed.I found it is so after to several other visits to Cafes in the town

Os A Whittle ● 4957d

Yes. I didn't suggest anything different, I don't think.

M Duley ● 4957d

Nice one about Australia Os.  The same in Singapore where one doesn't need to tip - there is aready a combined Government service tax and Vat equivalent and tip included in all the printed menus and receipts plus a general retail tax, all clearly declared.  Tipping is only done for exceptional service and personality of service provider. This applies to ALL services in Singapore, taxis, bellhops,  garages, restaurants/cafes, museums etc. Tipping is a personal reward for exceptional and beyond duty services in Singapore - NOT like it is in the USA!

Gerry Tan ● 4957d

"Tipping is a personal reward for exceptional and beyond duty services in Singapore - NOT like it is in the USA!  "I recall atrip to New York back in the late 90's.I only had a large over the shoulder bag so didn't need anyone to carry to my room in the rather plush hotel that had been booked for me overlooking Central Park.Obviously believing that I was incapable of operating a key card a 'flunkie' preceeded me and opened the door, I tipped him a modest amount as ws the 'norm'. Five minutes later a new 'flunkie' arrived and when admitted 9I just wanted a shower) asked me if everything was OK with my room.Having answered he stood there with his hand out (doubtless expecting a tip for this simple question). I told him that I didn't think that it was likely to rain in my room and to put his hand away, goodbye!

Nigel Brooks ● 4957d

Nice one Nigel - you should have threatened to spit in the outstretched expecting palm!

Gerry Tan ● 4957d

I was more worried about what else was spat in during my two day stay there. Luckilly it was a massive breakfast buffet and we ate out for all other meals :-)

Nigel Brooks ● 4957d

They put service charges for large parties because otherwise people don't tip properly. A party of six can easily run up a bill of £300, then leave a tenner by way of tip and think that's adequate.

Susan Kelly ● 4956d

Why tip at all if you have just put £300 in their coffers?Given the significant margins on most restaurant food (and especially wines) the service charges are simply profiteering.I will reward good service if I get good service, simply imposing a service charge does not guarantee this, quite the opposite in fact.

Nigel Brooks ● 4956d

Well said Nigel - just me feelings.And I have noticed some restaurants overcharge for wines imo.

Gerry Tan ● 4956d

I have a friend who is a wine supplier and the 'typical' mark up from wholesale to 'menu' prices is 3-400%!!!Think on that when you order your next bottle.

Nigel Brooks ● 4956d

Mark up of 400%?  EXTORTIONATE! Daylight robbery!

Gerry Tan ● 4956d

Tap water is still free -

Charles Campbell ● 4956d

Lots of products have that kind of margin (and more) added onto them before sale to the end consumer.It beholds one to understand the economics of the business (levels of overheads etc.) before becoming too outraged.Even then, the price that is charged is only charged because the customer is willing to pay it.  No paying customers = no sales = no business at all rather quickly.People only get upset about wine because it is one of the rare products where they think they know what the retail price should be because they can compare the prices directly in the supermarket.I would say that most wine is sold at more like 300% rather than 400% - i.e. paying £15 gets you a £5 bottle of wine at supermarket prices.

Tony Colliver ● 4956d

Yes, but rarely served with good grace when requested.

Tony Colliver ● 4956d

Not everywhere!The 300% mark-up is common and best evidenced by a Sancerre that wholesales for £60 per half-case (6) and which routinely sells for £40-45 PER BOTTLE.Add 12.5% service to that and a £10 bottle of wine will cost you close to £50!!

Nigel Brooks ● 4956d

Evidently, no one on here tips here anyway so the waiter probably could care less what the customer thinks :)  Speaking of mark-ups of 100s of %, you should have a go with my roofer.:)

Charles Campbell ● 4956d

TonyFew businesses operate at 75%GM (marking-up by 300%). The jewellery business is an exception but they don't add 'discretionary' service charges simply to serve you.Build this 'pure pofit' into the headline prices and let the customer decide. BTW £15 for a £5 bottle is 'only' a 200% mark-up. Few restaurants will sell the same wineas that one can but at a local supermarket but it is easy to check the wines at local restaurants by Googling the wholesalers. A local, and by some well-regarded, restaurant publishes an extensive wine list and I have yet to find a single wine at more than one third (only a 200% mark-up admittedly) of the prices they charge. This said, they don't sell cheap wine and I only have access to the 'public' wholesale prices; there are deep discounts for volume.

Nigel Brooks ● 4956d

Yes, too many Ealing restaurants charge extortionately high mark-ups for their plonk. There are a few however, where one can still get reasobable value for restaurant wine. I'll name them all local:-La Siesta in Bond St W5 - very good Spanish house plonk at about £12 Ealing Mangal(opp Daniels W Ealing)- limited selection but great value Chankya and Deluca winesOsteria del Portico, Ealing Green W5, very reasonable house Montepulciano d'Abruzzo, at about £13 a botWilliam's Fish Grill, Bond St W5 - good plonk for good price.Grove Cafe, The Grove W5 - excellent and v cheap Chablis at about £13 per go.There are a few more but I've forgotten their exact charges.

Gerry Tan ● 4956d

And that's the point Gerry. You equally remember the good deals as much as you recall being ripped-off.Most Indian and Chinese restaurants add a fixed low mark-up to wines. They are happy and their customers are happy.

Nigel Brooks ● 4956d

Maybe so Nigel, its my experience that our local Indian and Chinese restaurants choose some decidedly dodgy wines and charge extortionate prices for them. The ones I named(and remember) are sensible with their choices and prices.  There are a few others but I haven't been to them recently and I've fprgotten what they charge. Other restaurants are unreasonable imo.

Gerry Tan ● 4956d

Which reminds me of a number of happy times spent in 'Bunnies Tandoori' as was in Hanwell (we used to live in the flat over the restaurant back in '84 / '85).The proprieter quite clearly didn't have a clue about wine so in a rare period of serendipity we enjoyed some truly superb red wines which were quite clearly seriously under-priced indeed.Unfortunately, shortly thereafter the wine became undrinkable for the exact same reasons as the good stuff was served in the first place - he didn't have a clue!Never mind - it was fun whilst it lasted.  :-)

Tony Colliver ● 4956d

Many happy times in Bunnies but the best Indian takeaway I have ever used was also in Hanwell.The Curry Garden (now part of Keith's Sales and Service's premises) was a fantastic Indian takeaway by the side of Hanwell bus garage. As the late, lamented Michael Winner would say "historic". I don't know what they did to their Shashlick and Mutton Madras but the finished results almost have me weeping at the mere memory of how good they were.

Nigel Brooks ● 4956d

Nigel, don't weep with nostalgia for the Mutton Madras from Bunnies - or as Michael Winner might have said...calm down dear its only a memory!What's the best Indian take-away in Ealing?

Gerry Tan ● 4955d

Oh Gerry, GerryThe Mutton Madras was from The, late lamented, Curry Garden, not Bunnies.As to takeaways I really like that from Monty's in South Ealing, every bit as good as eating in the restaurant.The worst? Spicy Avenue opposite the Drayton Court Hotel. Once really good but a change of ownership/chef has resulted in small portions, thin or 'gloopy' (whichever is wrong) sauces for the dishes and with a lingering unpleasant taste. Apart from that (and the 1 star rating for hygeine) it's great :-)

Nigel Brooks ● 4955d

I hate it when we walk into a restaurant and ask if they have a table for two and they say, 'Have you booked?' If we'd booked, then we would say so, obvi, and we wouldn't need to ask if they had a table for us, WOULD WE!!!... I feel better now.

Susan Kelly ● 4955d

Young waiters who address my husband and me as 'You guys'.I'm on a roll now.

Susan Kelly ● 4954d

Waiting staff who deliver coffee cups to your table having spilt coffee in the saucer.I have other gripes about restaurants.

Gerry Tan ● 4954d

Waiters who bring the coffee with pudding rather than after.

Susan Kelly ● 4954d

Restaurants incapable of timing meals to arrive together.I resolutely refuse to start dining until everyone has their food.An awful 'American' idiosyncrasy that seems to be creeping in to the UK.

Nigel Brooks ● 4954d

Having to ask several times for l'addition.

Gerry Tan ● 4954d

But you keep doing that in Chinese restaurants Gerry :-)

Nigel Brooks ● 4954d

The waiter calling my wife and I "guys", clapping his hands in enthusiasm, in response to an ordered glass of wine saying "you wanna go large with that, yeah? (clap!) ......

David Bourne ● 4953d

Where was that so we can all avoid it like the plague?

Susan Kelly ● 4953d

1. Waiters who start to clear up your table when not everyone at the table has finished their course.2. Waiters who constantly re-fill your wine glass. P*** off - I can do it myself.3. Overcharging. Very common in Chinese restaurants, in my experience. This is almost a given at Maxim on Northfield Avenue4. A propos of Maxim; deranged restaurant managers who sing Happy Birthday to you at the top of their voice.

Alex Weel ● 4953d

2. Couldn't agree more. Just a way of getting you to drink more and order another bottle.4. Was it actually your birthday?

Susan Kelly ● 4953d

Susan, a place called The Living Room, off Regent Street. Haven't been back!

David Bourne ● 4953d

Had a deranged maitre d' at a Chinese restaurant in Soho who asked with a smile if everything was OK. Having just had a very chewy squid dish, I smiled back and said:- "The squid was very rubbery".  The deranged waiter smiled even more, bowed and said:- "Good, you come back soon please."

Gerry Tan ● 4953d