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"Service Charge" Added Onto Bill, What Gives? [moved from LA]

Hello,
This past weekend my friend and I dined at The Standard and a few restaurants also on Sunset Blvd. We noticed that those three places--only one of them a hotel--charged a 'service fee'. The Standard also charged a gratuity, supposedly because "European tourists rarely tip" (as explained by a manager there).

I have yet, thank goodness, to see this happen at restaurants in SD.

Too hungover and anxious to head home, we failed to ask personnel at the restaurants why the service charge was added.

So now am just curious if any LA Chowers can provide insight.

Cheers.

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  1. I'm not saying that charging everyone is a solution to the problem, but I will give the example of my fiancee, who works in a hotel as a server here in LA: She has received a zero tip on bills over $500 three times in the last week from foreign tourists, and come home with less than $30 after serving over $1200 worth of food on more than one night. I'm not saying that everyone should be entitled to charge everyone a gratuity, but I also don't think it's fair that a professional server should go to work and bust their ass for nine hours for what ends up being less than $4 an hour after taxes. I understand that it's irritating to be charged for a tip, but if you were serving a room full of people knowing they are going to stiff you when they leave, it's not a very good feeling either. I don't know what a good solution is.

    6 Replies
    1. re: la2tokyo

      That is the deal my friend, if you do not like it change jobs, it comes with the turf. By the way, that place that added the gratuity to foreign guest checks could be in a lot of trouble, that is illegal! Oh wait, we better add a tip to the bill because someone is asian, african american or armenian.

      1. re: Burger Boy

        If it is printed on the menu that the gratuity is included then it is not illegal as far as I know.

      2. re: la2tokyo

        Your fiance should keep detailed records of her tips/income. If she's not making at least full minimum wage after tips, her employer is required to make up the difference.

        http://www.dol.gov/whd/minwage/q-a.htm

        "An employer may pay a tipped employee not less than $2.13 an hour in direct wages if that amount plus the tips received equal at least the federal minimum wage, the employee retains all tips and the employee customarily and regularly receives more than $30 a month in tips. If an employee's tips combined with the employer's direct wages of at least $2.13 an hour do not equal the federal minimum hourly wage, the employer must make up the difference."

        1. re: Jen76

          In CA servers receive the full minimum wage of $8.00 per hour, time and one-half over 8 hours, plus tips.

          1. re: BN1

            The reality is that it is not worth the trouble to get a few dollars back. On good days she does well. But it is a fact that in many restaurants if you sell a large amount of food, you will be taxed for the tip regardless of whether you receive one or not. This means that it actually costs you money out of your pocket to serve a customer that leaves nothing. I'm sure that if you kept detailed records, you could tell managers, they could contact corporate accounting etc. etc., but not many people are willing to do that to get their $5 back from the IRS.

            1. re: la2tokyo

              That's correct in that the tipped employee is supposed to keep accurate records for both income and monthly payroll tax purposes.

      3. It's not a problem if this is disclosed ahead of time. Yes it's a practice in heavily tourist area restaurants where foreign tourists are not used to tipping practices here.

        10 Replies
        1. re: PeterL

          it is also common practice in LA to automatically add a service fee for parties of 6 or more.

          fwiw, when a restaurant does this, it actually saves me money because they normally add 18%, whereas my "normal' tip for great service is over 20% of the tax-included bill.
          for great mom-n-pop places with relatively low prices, i'll normally exceed the 20%.

          1. re: westsidegal

            They need to have that policy listed or posted somewhere.

            1. re: Burger Boy

              Assuming that this is where the OP visited, the menu does have this policy printed at the bottom:

              http://www.standardhotels.com/upload/...

              1. re: bulavinaka

                The part that I'm not fully clear on is this:

                "charged a 'service fee'."

                "The Standard also charged a gratuity, supposedly because "European tourists rarely tip" (as explained by a manager there)."

                globocity- Are you saying the Standard included both a Service Fee and a Gratuity?

                1. re: LATrapp

                  Sugarfish adds a 16% gratuity. I like it.

                  1. re: LATrapp

                    With all the "ands" between the subsets, I'm guessing the place either uses its discretion loosely, or they just ends up putting the charge on every tab. As westsidegal and maudies5 point out, this might be a benefit to in the end to many. I'm usually in the same boat.

                    1. re: bulavinaka

                      The discretionary method seems like a good way to get sued or to build a reputation for racism, sexism, or any other ism's that exist.

                      When I was a server we HAD to add the auto-grat for parties of 6 or more. Sometimes it really sucked because you knew you had a great rapport with a table, you doted on them, and they seemed like the type that would reward you with more than the 18% automatically added.

                      But, not putting it on there could get you fired. We couldn't pick and choose who got it and who didn't. So, when people say they tip less because of it, it drives me nuts. Don't be insulted that a server may just be following policy to keep their job.

                      1. re: Azizeh

                        >>The discretionary method seems like a good way to get sued or to build a reputation for racism, sexism, or any other ism's that exist.<<

                        It's just conjecture on my part - the wording leads me to think that discretion might be used. And I think it might be hard for a someone to claim an -ism as each tab seems exclusive of each other. I know it can happen - two friends talking about each of their experiences at a given eatery - one reveals they were charged x-% service charge or gratuity on their tab, while the other swears no such charge was added and their experiences were otherwise similar.

                        >>But, not putting it on there could get you fired. We couldn't pick and choose who got it and who didn't. So, when people say they tip less because of it, it drives me nuts. Don't be insulted that a server may just be following policy to keep their job.<<

                        Unfortunately, it's not for me to know policy and procedure between a restaurant's employer and employee. My end of the deal as a respectful and responsible diner is to make sure the server is tipped accordingly. If the eatery takes this out of my hands and slaps on a gratuity/service charge themselves, well that's a done deal for me, unless the service was extraordinary - I will slip extra samolians to the server in a discreet shake of the hand, hoping that the server knows that they deserved more than the house feels.

                    2. re: LATrapp

                      Yes, they charged us a service fee and 18% gratuity. The bakery in West Hollywood (again, forgot the name) charged service fee only.

                    3. re: bulavinaka

                      A lot of places in Florida do this on a discretionary basis. If I were a tourist, I might be surprised, but it's right there on the menu or on a sign at the door. If I were a server like la2tokyo's friend, I'd be pissed and looking for another job. If you can't afford to tip, you probably should stay home and tourists need to learn that, too. It comes with the, uh, turf.

              2. Good to see more American restaurants adopting British "service charge" practices in place of old fashioned tipping. IMO, it can only lead to improved standards of service. Perhaps disappointing that,as they are changing, they are not going the whole hog by adopting the French practice that service is inherently included in the menu meal price and nothing further is required from the diner. Even better.

                2 Replies
                1. re: Harters

                  Great, servers that know they are going to make 15%-18% no matter what kind of service they give, please. I want someone to serve me who is motivated to give me great service and they shall be rewarded.

                  1. re: Burger Boy

                    In Europe, the motivation to do a good job as a restaurant employee is the same as the motivation for an employee in any other industry. Don't and you get fired.

                    In my experience, the service charge route generally provides an overall better level of service than old-fashioned tipping - not least because it encourages a team approach to the service. I entirely agree that good service is dependent on well trained, well motivated professional staff. I also agree that there is often a difference, between Europe and America, about what constitutes "great service" and how it is carried out.

                    As I said, my preference is always for the French system where there is neither tipping nor service charge and staff are simply paid a wage, often supplemented by an annual or monthly bonus, as a share of the restaurant's profits

                2. Am I missing something here? Notification of a 15% gratuity is commonly practiced in the USA.

                  A service charge is something else entirely. A slap to the back of the head because the diner(s) didn't realize that their Teppanyaki Chef, or their belly dancer or those strolling minstrels who stopped by your table, are being paid for their services--not by the resto, but by you.

                  Deceitful on every count!

                  2 Replies
                  1. re: RedTop

                    Wait, how is that deceitful? I've never seen a service charge that was separate from the gratuity, but I've seen the gratuity added to the bill lots of times, mostly for large parties. I have never felt that I am limited to the amount that is added to the bill, and ofter tip higher than the mandatory gratuity if I receive excellent service. It never occurred to me to limit my tip because there is a set gratuity.

                    My husband is a musician and often plays at a local restaurants. We have never heard of a resataurant charging any fee on the bill that goes to the musician(s). Do people really not know that the musician is paid by tips, and not by the restaurant? Even if they don't, how is it deceitful? The only person who is potentially hurt by that policy is the musician. It is quite clear that patrons do not feel obligated to tip the musician, and a musician in that position is very grateful to those who do tip. I have always assumed that the same is true for dancers, magicians, etc., unless there is a separate cover charge for entertainment, in which case the cover is clearly for the entertainment, rather than food or drink.

                    Can you give an example of how this practice is deceitful?

                    1. re: Kathleen M

                      >>Wait, how is that deceitful? I've never seen a service charge that was separate from the gratuity, but I've seen the gratuity added to the bill lots of times, mostly for large parties.<<

                      A gratuity of 15 or 18% for a party of six or more is almost always mentioned somewhere on the menu. It's so common that most diners in the US understand that this is expected.

                      I view an unstated Service Charge--that is seperate from the expected gratuity, as a deceitful practice. And yes, I've been burned at a local Japanese Steakhouse by this charge for the service of a Teppanyaki Chef; and in FLA for "entertainment" provided by strolling musicians at a Mexican restaurant.

                  2. I'm sorry, but as a customer, a former restaurant worker, and a future restaurant owner, this is all a bunch of BS. As has been pointed out on numerous other threads about tipping, a gratuity is OPTIONAL! This is nothing but a cheap @$$ owner strongarming his patrons into paying his employees extra wages so he makes a bigger profit!

                    1. I understand adding gratuity to large parties but it was just the two of us. It was my fault for not reading the bottom line on the receipt indicating that there was an added service charge. What I did not see was the added gratuity. Unfortunately for me (but fortunately for the servers) I had left cash tip so they ended up getting a 38% tip!

                      Again, I would like to know what the "service charge" assuming that is different from gratuity.