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Old 2nd January 2011, 12:05   #16
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Default Re: Can a customer be charged for Service ???

^^ Agreed service charges would be un-necessary if people were honest about tipping properly. What really happens is that some places have exceptional service, however the kind of people that frequent that place are lousy tippers. As a result the waiters go up against management to raise their pay - now management can't just raise the rates of food items so they put it in as service charge. If i tip 10% under perfect circumstances, and the service charge is already 5%, i will leave an additional 5% tip if happy, else worse case if i was treated pathetic in that place, i'd leave 0%. However most people just leave 0-1% tip irrespective of service and in such cases service charge takes care of the waiter's pay!

So I agree here that service charges should not be there, infact I am against them! But then we need to do our bit and tip when deserved (some of us may but in general the masses don't!)

Last edited by jassi : 2nd January 2011 at 12:07.
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Old 2nd January 2011, 12:30   #17
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Default Re: Can a customer be charged for Service ???

Am very worried by most of posts here.

In a typical "dosa kind of restaurant" here in KL, a waiter is paid between 250 to 350 INR a day (daily wage basis). Or Upwards of 8K per month (when paid on monthly salary basis).

Are people here saying that at places where beverages / products which otherwise cost less than 100 INR (I am very bad at costs of any kind of spirits except Motor Spirits) are sold at between 3X -r 4X prices, we need to pay further premium?

Not that it is a bad idea, but we can / should carry that further. Think of a bill like this:-

Quote:
1. Masala Dosa 10 Nos - Rs. 50/-
2. Chutney 10 Nos Rs. 150/-
3. Sambar 10 Nos Rs. 150/-
5. Plate cleaning 10 Nos 150/-
6. Service Charges Rs. 50/-
Total Rs. 550/-
And

Quote:
1. Masala Dosa 10 Nos @ 55 each Rs. 550/-
Total Rs. 550/-
I will prefer the latter bill, and will be still happy to pay a 20 Rs. tip over and above that.

I would never enter the first restaurant.

Labour laws in India require payment of minimum wages, and do not permit "tips" as part of wages.

And there is no assurance that the "service charge" is reaching the hands of the waiter. When i pay a 10 rs. tip, I am at least assured that it is reaching his pocket.

Edit:- Municipal laws (laws which govern health / running of restaurants), which are issued by the local body (Bangalore Corporation, in this case) require that price of food items should be prominently displayed on a board, OR the menu card. Since the service charge, which is compulsory is not displayed, the management is breaking the law.

Last edited by BaCkSeAtDrIVeR : 2nd January 2011 at 12:34.
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Old 2nd January 2011, 12:36   #18
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Default Re: Can a customer be charged for Service ???

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Originally Posted by jassi View Post
^^ Agreed service charges would be un-necessary if people were honest about tipping properly.
When you enter a restaurant is there any agreement mentioned anywhere that x% has to be given as tips.

So how can not tipping be called dishonest.
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Old 2nd January 2011, 12:53   #19
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Default Re: Can a customer be charged for Service ???

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Originally Posted by jassi View Post
because the way the hospitality industry works is different from all these examples. i don't know if this is true for India, but globally waiters are normally paid 'minimum wage' and they are expected to delight customers and make their income using TIPS.
I would think that any person who is paid for a job is expected to delight customers.
May be the hospitality industry should change the way it works, instead of us being expected to change for them.

Quote:
Originally Posted by jassi View Post
^^ Agreed service charges would be un-necessary if people were honest about tipping properly.
Or if the employers were honest about paying waiters properly.
Quote:
Originally Posted by jassi View Post
What really happens is that some places have exceptional service, however the kind of people that frequent that place are lousy tippers. As a result the waiters go up against management to raise their pay - now management can't just raise the rates of food items so they put it in as service charge.
How is putting it in service charges different from raising the rates of food items other than the fact that it's a sneaky way of doing the same?


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Originally Posted by bblost View Post
When you enter a restaurant is there any agreement mentioned anywhere that x% has to be given as tips.

So how can not tipping be called dishonest.
Exactly.
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Old 2nd January 2011, 13:31   #20
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Default Re: Can a customer be charged for Service (at a restaurant)?

The wrong thing about putting service charge in the bill is that if i feel the service at the place does not deserve a 10% tip, there is nothing that i can do about it. I will have to shell out 10% even for pathetic service.
That's my choice being taken away from me and i do not like that one bit.
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Old 2nd January 2011, 13:43   #21
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Default Re: Can a customer be charged for Service (at a restaurant)?

Quote:
Originally Posted by shankar.balan View Post
By and large we Indians are seriously El Cheapos when it comes to leaving tips for service. Generosity is very low on the list of "things to do and live by".
I disagree. At least in Goa most waiters have experienced the Indian Tourists tipping much more than the foreigners.

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Originally Posted by carboy View Post
Ask him why instead, he doesn't increase the rates on the menu by 5%, pay the waiters extra using that & not have any separate charge.

It's a scam to raise prices without raising prices.


Why should I tip 10%? I don't get tipped 10% at work.
Do you tip the guy who delivers the milk everyday 10%.
Do you tip the guy who delivers newspaper everyday 10%.
Do you tip the guy who washes your car 10%.
When you do a remodeling of your house costing 5,00,000, do you tip 10% on top of it?
When you bought your car, did you tip 10%?
You have a valid point here.
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Old 2nd January 2011, 13:51   #22
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Default Re: Can a customer be charged for Service ???

Few points:

Service Tax is different from Service Charge

Service Tax goes to the govt, There is some ambiguity/controversy in the application of Service Tax in restaurants, but for the purposes of this discussion lets stick to Service Charge.

Service Charge (goes/is supposed to go) to the waiters. The charges are the same as tips and are usually pooled and distributed amongst the staff. Restaurants tend to shift to a standard model of % is to ensure equal distribution among staff.

In a majority of cases, the restaurant writes on the menu "we levy an additional service charge of 10/15%". If they dont, have it written then you have every right not to pay.

If it is written then you know what you are getting into right up front. It is your call if you want to eat there or not (for reasons of affordability/principles whatever rocks your boat).

It is a reasonable expectation that you would pay unless they very badly screw up and service is abysmal and you want to argue.

If there is a super star waiter, customers who are extremely happy usually tip more for individual brilliance.

Quote:
Originally Posted by carboy View Post

>>Why should I tip 10%? I don't get tipped 10% at work.


In many industries (e.g. software), people usually get an incentive component and there is an 'expectation' that it will be in the mid range unless one is an extremely poor performer or superstar performer. The 'expectation' is not written anywhere but it is an expectation just as it is in the hotel industry


>>Do you tip the guy who delivers the milk everyday 10%.

The relationship is different. It is a longer term one

In most parts of India one usually ends up giving a 'Diwali' bakshish once a year, love it or hate it.


>>Do you tip the guy who delivers newspaper everyday 10%.

Same as above.



>> Do you tip the guy who washes your car 10%.

In many parts of India one usually ends up giving a 'Diwali' 'bonus' once a year.


>>When you do a remodeling of your house costing 5,00,000, do you tip 10% on top of it?

It is not an 'expectation'


>>When you bought your car, did you tip 10%?


It is not an 'expectation'

The cultures for tips vary from country to country and in some countries over the years it becomes an 'expectation'. Some choose to make the 'expectation' explicit, some do not.
How you handle unwritten 'expectation' is a person's personal prerogative. As to how these 'expectations' come into being, it probably left to sociologists and ethnographers

Last edited by genesis : 2nd January 2011 at 13:53.
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Old 2nd January 2011, 13:58   #23
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Default Re: Can a customer be charged for Service ???

Quote:
Originally Posted by genesis View Post
>>Why should I tip 10%? I don't get tipped 10% at work.

In many industries (e.g. software), people usually get an incentive component and there is an 'expectation' that it will be in the mid range unless one is an extremely poor performer or superstar performer. The 'expectation' is not written anywhere but it is an expectation just as it is in the hotel industry
But the customer isn't directly charged for this.
The employer pays the employee this. Let restaurants also do the same. i.e. let them raise the rates of items on the menu, assuming the average incentive they would need to pay their waiters. Don't pretend to have a lower price on the menu & expect the customer to directly pay the waiters their incentive.

Quote:
Originally Posted by genesis View Post
>>Do you tip the guy who delivers the milk everyday 10%.

The relationship is different.

In most parts of India one usually ends up giving a 'Diwali' bakshish once a year, love it or hate it.


>>Do you tip the guy who delivers newspaper everyday 10%.

Same as above.
My postman, telephone guy etc have come asking for bakshish, but I don't remember my milk guy or newspaper guy asking for Diwali Bakshish from me.


Quote:
Originally Posted by genesis View Post
>>When you do a remodeling of your house costing 5,00,000, do you tip 10% on top of it?

It is not an 'expectation'


>>When you bought your car, did you tip 10%?


It is not an 'expectation'
So may be we need to change the expectation of people working in the service industry.
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Old 2nd January 2011, 14:20   #24
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Default Re: Can a customer be charged for Service (at a restaurant)?

I DISAGREE with someone here who says Indians are Cheapos. For some dining out may be a monthly affair, bot for me it is quite often, at times even 3-4 times a week, with a bill running anywhere from 700 - 3000 on average.

So, I cannot tip every time I go, That does not make me a cheapo. Right??

When it comes to tipping, yes I am generous and even tip over and above the service charge (Basically a forced tip)

I completely agree with what someone like Phamilyman has written. How often have u seen beggars faking that they are on a crutch and then once u drove by, u see them walking in the rear view mirror. I have. So be my guest and go ahead and give them. But dont label we Indians as Cheapos.

Unlike aborad, we face numerous circumstances where we are in these situations. Also, aborad, tips are mostly left only at fine dining restaurants and not the billion fast food outlets that are prevalent.

As far as the legality of service charge is concerned, I am not sure. But ,most places have this charge these days, from Dominoes, PHut, almsot all restaurant at places like UB City, including Shiro, Tangles etc
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Old 2nd January 2011, 14:40   #25
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Default Re: Can a customer be charged for Service (at a restaurant)?

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Originally Posted by thedreamcatcher View Post
I DISAGREE with someone here who says Indians are Cheapos. For some dining out may be a monthly affair, bot for me it is quite often, at times even 3-4 times a week, with a bill running anywhere from 700 - 3000 on average.

So, I cannot tip every time I go, That does not make me a cheapo. Right??
No. You are providing employment for the waiters by eating out frequently. They should be thankful to you irrespective of how you tip.
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Old 2nd January 2011, 14:51   #26
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Default Re: Can a customer be charged for Service (at a restaurant)?

The wages of restaurant waiters are fixed at a basic level, and he is expected to make the balance from tips. This is shifting part of the wages to the customer, thus fattening the pockets of the owner.

A tip is something I pay if I feel like it, it is not obligatory. But hardly anybody leaves without tipping, generally. AFAIK the service charge is shared among all the employees - from the billing clerk onwards - and not just by the waiters. It is supposed to be in lieu of overtime, actually.

Please do not bring in beggars in to the discussion, it is inappropriate. I have known of beggars on the electric trains in Chennai, some of whom were loan sharks. They actually lend money to the hawkers on the trains at meter rates! I have even seen some of them use cell phones on the sly! Abducting, maiming and forcing childen in to beggary is a racket by itself. I have heard of brokers who hire out children to beggars. So please do not encourage beggars under any circumstances. I am scandalised by the suggestion of giving Rs 20 to beggars!

Last edited by Gansan : 2nd January 2011 at 14:55.
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Old 2nd January 2011, 15:00   #27
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Default Re: Can a customer be charged for Service (at a restaurant)?

@carboy,
you raised valid points!!!

I wonder, if service charge is shown in the final bill, how the hotelwala keep accounting in concern with vat and income tax.

I have not noticed yet carefully the bill but do anyone observed the vat portion which should be strictly for materials and not for service charge.
If vat is shown for service charge also, then its double cheat.
It vat is not shown for service charge, then hotelwala can be in trouble if anyone decide so.

Last edited by ASHISHPALLOD : 2nd January 2011 at 15:02.
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Old 2nd January 2011, 15:20   #28
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Default Re: Can a customer be charged for Service (at a restaurant)?

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Originally Posted by ASHISHPALLOD View Post
@carboy,
you raised valid points!!!

I wonder, if service charge is shown in the final bill, how the hotelwala keep accounting in concern with vat and income tax.

I have not noticed yet carefully the bill but do anyone observed the vat portion which should be strictly for materials and not for service charge.
If vat is shown for service charge also, then its double cheat.
It vat is not shown for service charge, then hotelwala can be in trouble if anyone decide so.
Vat in restaurants is charged on the service charge also, for precisely the reason you mention. (Hotelwala can be in trouble if anyone decides to do so!). From what I understand from reading some articles, VAT is usually on aggregate amount for which goods are bought/sold. And the definition of 'aggregate amount' is why CA's and tax lawyers are in existence.
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Old 2nd January 2011, 17:15   #29
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Default Re: Can a customer be charged for Service (at a restaurant)?

Interesting read.

IMO, there is no express prohibition to collect service charges over and above the bill amount provided a information to that effect is prominently displayed somewhere in the restaurant.

All i can say that, the above idea is a recipe to loose customers and invite unwarranted disputes. Any wise hotel management would never commit the blunder of doing so.

Go on and inflate your price list.... if your price does not suit me... I can always look out for a option
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Old 2nd January 2011, 21:05   #30
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Default Re: Can a customer be charged for Service (at a restaurant)?

Firstly, if service tax would be added to the final bill then it must be mentioned in the menu card/clearly written in the restaurant.

Secondly, i have different thoughts than many of you. You may call it Indian Cheapo. Employer is supposed to pay the waiters not customers. Tip is given for a good prompt service. If you pay tip for good food than you are fooling yourself as it wont go to the cook. So, if someone wants to tip then it should come from heart and pay as needed. Setting up a 10% guideline is ridiculous.

The tradition of extracting pay of waiters/workers from people is a poor idea. They remain heavily underpaid. Someone mention about Indian Cheapos then he is actually not aware of foreign tourists. There are backpackers and then there are others (mostly elder people). The backpackers wont pay any tips and other category would spoil.

Example:-

In my recent Nile Cruise trip, I met an Indian Couple on the cruise who sheepishly contacted me about the "tip rates". He was too fixated was this 10% non sense. He paid 10% to the guides/cruise staff etc. You wont believe the total tips he paid was equal to the price travel all inclusive of one member. . This was the case when the tips were to be given in an envelope, causing no embarrassment. I showed him people (foreign tourists from developed countries) putting coins (chillar) in envelope. But he was too fixated by 10% and Indian Cheapo guilt.
In Egypt people demand tips "baksheesh". A person earning 200 LE as salary wants LE 50 tips for 1 hour tour is asking too much. In this case his salary is his pocket money. Blame the employer.

I also read someone saying people spent 4000 on food and can not give 400 as tip. Its ridiculous. People here spend on fuel which is more than salaries of many. So what should he do? Start tipping these underpaid persons. Someone earns then he spends as he likes. It reminds me someone here asking me LE5 for a LE1 item. The reasoning was that since I can cruise, I can also pay LE5. Of course I can but not for any item worth LE1!

Verdict: Its your own money. Tip is a tip and not a salary.
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