Restaurant surcharges & service charges: threat or menace?

Since only a few people are talking about hi ho I assume you’re referring to me.

I’ve already voiced my opinion about all of these places. Hi Ho, is a new one to me. The shock has already worn off about Jon and Vinny’s.

I will never, ever support a business with these deceptive practices. If I never eat out again, so be it.

3 Likes

Okay, now THAT ONE really gets the f*ck from me!

4 Likes

To be fair to them I’ve heard that they pay kitchen staff pretty well. Something like 19 per hr + tip.

3 Likes

I feel like a not insignificant part of the issue is that they’re calling it a “service charge.” We’ve been conditioned over decades to consider a service charge a tip (for example, parties of 6+ will be subject to an 18% service charge), now they’re trying to make it something different. I liked it better at least when places called it a “healthcare surcharge.” Maybe call it a “cost of business” charge or something like that.

But man, that Pijja Palace menu being aggressively dickish about the service charge sure is something.

7 Likes

Yeah I definitely think there’s funny business involved with some of these service charges, and imo if you have a service charge there should be no tip line on the credit slip.

but when hearing servers complain about it the one thing I think about is how many times I’ve heard a server say Kitchen doesn’t deserve my tips, they don’t contribute anything to service. Like a total disconnect that people literally show up for the food so yeah they contribute a lot

I think restaurants deserve higher profit margins/more breathing room, and maybe it is time to rethink what a tip is and what a service charge can be/represent, but it seems a lot of places moved straight into the murky grey area with a hint of defensiveness and breezed right past the equity for boh/foh

4 Likes

This seems like conditioning customers to just pay extra fees for no reason. What’s next? A comfortable chair surcharge? Ocean view table surcharge?

The whole American model of tipping and extra fees is annoying. Increase your costs, do what you gotta do, but if we were more like Japan when it comes to tipping in restaurants, I would be much happier.

4 Likes

Yeah I agree. I think it’s been proven tho that people aren’t ready to just pay more (even if that’s what they’re doing by tipping/service charge)

That’s why id be cooler with service charges if there were no tip line and way more transparency.

But these days I just eat out a lot less

3 Likes

There’s always a power dynamic/dance between diners and restaurants. Sometimes it’s closer to equilibrium, others actively negotiated. Tips were often the illusion of control more than an actual feedback, but at least with tipping, caveat it screwed BOH, consumers had some agency/power.

Naran says it’s a simple equation: “However a restaurant decides to structure its pay, you as the diner should trust what they’re doing. It’s insane to think you can go into dinner and walk away understanding the intricacies of running a business.”

In a way he’s not wrong. And at least he’s effing honest (though must be nice to run a business where your dad is the landlord). But they, however unintentionally, opened Pandora’s box with the ‘healthcare’ and other surcharges as @formersushichef mentions, inviting diners to solve industry wide pay equity, a problem we can’t solve without auditing their books. And I don’t think they realize how corrosive this stuff is to the restaurant experience. I’m sympathetic to the difficulties of the biz, but if their attitude is trust us on opaque fees, of course we’re not pocketing some, I have limited patience for the poverty pleas and the parasocial appeals to partnership and justice.

Don Draper Gif

Aside: This bill (my other hobbyhorse) is prob way more significant for their bottom line.

https://www.nrn.com/extra-serving/how-credit-card-competition-act-could-impact-your-restaurant-s-finances

`

5 Likes

TBH, I’d be okay w/ that since it’s not dissimilar from, say, what hotels do (where you pay more for a room w/ a nicer view). In Italy, I recall that, if sat at table for your coffee, you got charged extra (vs. standing at the counter).

What I would be annoyed w/ is, for example, I got charged extra b/c they broke up the utility bill and have to pay more to keep the lights on later at night.

For me, @bruins and @butteredwaffles really nailed the issue. If something is called a “service charge,” why am I being expected (or even being given the option) to then tip on top of that? And don’t be a d*ck about charging it.

HiHo didn’t bother me that much b/c there’s no tipping allowed. So you “just” get the 6% service charge.

5 Likes

Yeah back in 2013 (?) a couple years after I left this place in SF I got a series of settlement checks because the owners had been sued or it was found out they were way misusing the SF 4% charge or whatever it was.

3 Likes

Agree about transparency @paranoidgarliclover, but for me there’s the issue of employee compensation in the switch to service charges. Obviously y’all know this stuff, but tipping was meant to compensate a group for whom the wages from restaurant work weren’t sufficient. And thus wage theft laws (i’m really outing my lawyer brain side here).

Service charges convert that money to a general fund that owners can do whatever they want with. If they passed an updated wage theft law - service charges only to non management staff - I’d be fine with the change. I’m probably a good bit self righteous on this issue but it really bothers me. The 20% we leave is not meant to go to the owners or managers of the restaurant!

7 Likes

Yeah I guess I vote with my wallet. If I’m considering eating somewhere with a service charge do I trust how the charge is allocated/that the money spent is worth it.

5 Likes

Reading all this seems so lame . Just print the prce on the menu . Surcharge for my party and getting my hair done . Fot sure . Walk away

1 Like

The SF DA went after restaurants that had surcharges described as for health care but that didn’t spend it as claimed.

4 Likes

Except when it’s clear you can’t trust them, as with Jon & Vinny. So it’s not that simple.

2 Likes

Oh, but I think transparency and employee compensation are deeply related (so I think we are largely making a similar point).

I, as a layperson, would think that something labelled a “service charge” would go to the server. Had I not been a member of this forum, it never would’ve occurred to me that something labelled as “service charge” would be distributed to anyone but the wait staff (or I guess non-management staff more broadly, as you put it).

So, to me, part of the lack transparency is how the surcharge came to be labelled as a “service charge” and if there was some knowledge (or hope) on management’s part that most people would misunderstand what this was…

4 Likes

Please press the Heart like button to vote!

What would you do if you saw a 18% charge on your bill?

Would you

  • Add on an additional 15-25% tip onto that bill

Or

  • Not pay any tips 0% to the bill with the 18% service charge
8 Likes

If there’s an 18% service charge, I typically tip 2% to bring the total to my usual 20%.

Unless the service charge seems bogus, a la Jon & Vinny’s, in which case I won’t eat there.

3 Likes
3 Likes