Customers hit with automatic 20% gratuities as restaurants combat tipping confusion

[El Presidente]

20%? 

As restaurants in several FIFA World Cup host cities welcome an influx of international visitors this weekend, some operators are adding automatic gratuities to customers' checks, citing concerns that guests from countries without a strong tipping culture may unknowingly undercompensate workers. 

https://www.foxnews.com/food-drink/customers-hit-automatic-20-gratuities-restaurants-combat-tipping-confusion

[riderpride]

If that's the case, then just increase prices. It's increasingly rare to find a level of service worthy of any of the default tip values (18, 20, 25%), and is one of the only ways a customer can give feedback for the server. If you want 20%, you just need to earn it. Yet another shortsighted cash-grab that will infuriate the locals. 

Cheers!

[JohnS]

3 hours ago, riderpride said:

If that's the case, then just increase prices. It's increasingly rare to find a level of service worthy of any of the default tip values (18, 20, 25%), and is one of the only ways a customer can give feedback for the server. If you want 20%, you just need to earn it. Yet another shortsighted cash-grab that will infuriate the locals. 

Cheers!

Exactly this. I've been a tourist three times to the USA (admittedly, before the current administration changed the entry rules for Australian tourists) and I never had an issue working out the gratuity charge for service. Furthermore, I enjoyed the right to determine what good service was by what I tipped. I agree, this is another cynical 'money-grab!'

[Çnote]

I feel this is aimed at me, I'm service less than a mile from 'Dallas Stadiun.' We were full of Orangemen and Japanese fans Saturday night, tomorrow is VIPs from I shouldn't even mention. We'll be busy all month, but coworkers are still worried about making money because of the cultural differences we are seeing.

USA tipping culture is confusing, I'll grant you that. Most states, server wage is $2.13/hr. Daniel Meyer tried to eliminate tipping culture by raising prices and failed. California is $15 an hour guaranteed, service charges to help balance back of house pay to front of house and there is still tipping. I personally wouldn't run service if it wasn't tipped. 

A very fine point in federal labor law, a 'gratuity' goes 100% to staff. A 'service charge' may be held by the house for arbitrary dispersal.  A 20% grat during FIFA is to ensure that staff get paid for their labor when it's busy, especially when alcohol is involved. Most venues in the US automatically do this for large parties anyway. Most of the bars in the immediate vicinity of 'Dallas Stadium' do it on game days already. The only people I've seen complaining are locals that are up in arms over a few dollars.

I've been either service or restaurant adjacent for my entire career. Lots of single parents. Lots of guests leave gratuity that becomes formula, diapers, and braces. Admittedly, a lot also goes directly to dive bars & dealers. Everyone makes their choices.

If you really want a server to understand you were dissatisfied with their efforts, leave a reasonable tip and speak to a manager on the way out. Tell them you tipped, they'll be more outraged about server's performance than you could ever dream. That server will understand.

Real math though, the difference between 15% and 25% is about a BR Fenomenos for most of my tables. Many here smoke better than that on the regular. I just got back from Brisbane and am waiting on details for Honduras. 20% is a pay cut for me.

[El Presidente]

4 hours ago, Çnote said:

Most states, server wage is $2.13/hr.

That is a disgrace. 

I understand that provided the tips doesn't bring the employee up to at least the federal minimum wage of $7.25 an hour, the employer needs to make up the difference. That is still a disgrace. 

I understand Cody's argument. However in most Western/OECD countries, you are prepared to pay a good price for a great meal. Wait-staff are paid fairly. Tipping, when done, is the reward for excellent service. 10% is the norm. 15-20% would require EXCEPTIONAL service. 

When in Latin/South America/parts of Asia/Greece (quirky), you change the formulae. Most Westerners/OECD wouldn't think you would need to adopt Latin/South American practices in the USA. 

When in the US I tip 15% as a rule. Cash and to the server. However, meals are no longer cheap in the USA. Eating in Cali/NY/Miami is the same if not more than Paris/London/Sydney/Tokyo/HK. How does that math work? $150 a head and then 20% on the bill for average/good service. No input?  It's a joke. 

[Çnote]

4 hours ago, El Presidente said:

That is a disgrace. 

Yes. I'll double down here, the 'tipped minimum wage' is a legacy of Jim Crow, where it was legal to underpay the newly freed slaves in service jobs. 

4 hours ago, El Presidente said:

the employer needs to make up the difference.

Fine print, the employer only has to look at the entire work week, so if you made zeros on multiple shifts but balanced >$7.25 per hour for the week, no extra pay. Also, taxes for tips are normally removed from the paycheck, so that extra is probably directly to FICA/SS. The current $25k exemption is moving deck chairs around, it's about the same as it was. I'll stop so as to avoid the 3rd rail.

Europe, an extra euro or two is enough. Asia, it's often rude to tip, same in Britain last I visited. I tipped bartenders in Brisbane $5s, but I was talking a lot of shop. Servers I rounded up to $5 or $10 when paying cash when service was exemplary (it often wasn’t). Here I tip 22-30%, my coworkers often 30-45%, partly superstition.

Hard math: 15% vs 20% at $150 after tax (8.25% TX) is $6. Table of four is a BR Fenomenos, give or take. Tipping culture is wild.

[El Presidente]

3 hours ago, Çnote said:

Hard math: 15% vs 20% at $150 after tax (8.25% TX) is $6. Table of four is a BR Fenomenos, give or take. Tipping culture is wild.

Hard Math: 4 people. Exceptional Dinner in Paris $150 Euro per person. Dinner in NY/Cali/Miami  $130 USD per person. 

10% tip Europe = 60 Euro and you can drop the tip if service isn't excellent. 

20% tip US =  104 USD...and TRY walking away without one if it isn't excellent!

Meal price is the same. Hard cost structure mostly the same (premises/fitout/licensing/food costs etc). 

Wages obviously vastly different. 

It's a con. 

[Li Bai]

I've first heard about tipping culture in the US via Reservoir Dogs and to be honest, none of this seems to make sense but I do tip too. I've never gone to the US but I feel for those workers...

[Çnote]

3 hours ago, El Presidente said:

It's a con. 

Absolutely. But, the 2nd time I see your rez the cava is waiting chilled at the table, I only ask how you take your negroni so as to let you know I remember, your steak is mid-rare regardless of what the kitchen is doing and I just happen to have gotten a new rare Pedro Jimenez since last time. I might even get Di flowers if I knew it was a day for her. It's not hard to make 25% when you pay attention to every detail of someone's experience. I'm also in a pretty nice place, not TGIFridays.

The culture of shifting the pay to the guest isn't great, and it's getting worse with inflation. It doesn't help at all that corporate venues are very top heavy wage wise, and independent venues can't compete with expensive advertising. People mostly go out for comfortable experiences or to celebrate, and then they bring expectations.

Also, I think most restaurants outside the US are run tighter with regards to food cost, the food distribution network has consolidated is such a way that it's hard to do things correctly. There's also a huge skill gap after Covid. Butchery and knife work in particular are hard to find, but that's all back of house issues.

[Çnote]

22 minutes ago, Li Bai said:

I've first heard about tipping culture in the US via Reservoir Dogs and to be honest, none of this seems to make sense but I do tip too, never went to the US but I feel for those workers...

This scene is 100% correct and I've found it hard to have any sympathy for any of Buscemi's characters because of Mr Pink's views on tipping. Great actor. Maybe too good.

[Çnote]

Oh, more hidden math before I try to get some sleep before a 10am shift.

Let's say a server runs a $600 book and takes $120, 20%. Most venues will take 3-5% total sales for the bussers & bar. There are more arcane ways of doing this, like 8% alcohol sales (roughly half of expected) to bar, min $3/10 lunch/dinner cash to bussers, etc. It is rare that a server will keep every dollar. 3% of $600 on $120 => $102, so that's 15% of the night to bussers.

That 3% sales is a hard number as opposed to the soft number of an expected 18-20%, the less % you take, the more % of your take is paid out to your support staff.

More complicated are server pools, where a group or the entire floor will kitty everything together so as to avoid unlucky nights (or provide mutual support). Someone always 'loses,' it that your book may be $1k, but the pay out is $200 as you took more covers (guests) than someone else, while they did cleaning and resets etc. Often large parties will have a senior server running the book and juniors as extra hands, with an even share (even shares is actually mandatory according to federal labor laws). There's pros and cons here as to level of service provided, as the team has to self-correct to ensure no one is coasting on getting a full share without doing what is required to earn that 20%.

We can talk this through at 2am in Honduras. I 100% agree that comparing USA tip expectations to the rest of the world is laughable, but the difference between 15-18-20% is pretty minor for anyone smoking cigars on the regular, much less the insane ticket prices that FIFA is charging, or parking for that matter!

[El Presidente]

3 hours ago, Çnote said:

Hard math: 15% vs 20% at $150 after tax (8.25% TX) is $6. Table of four is a BR Fenomenos, give or take. Tipping culture is wild.

Have a great night Cody! 

Mate, I don't begrudge anyone making a damn good living by excelling at what they do. You don't excel but are an honest worker, then a minimum livable hourly rate should be available. 

When it comes to US tipping however, it is hard for many visitors to accept that  tipping is no longer about service, but rather a compulsory (largely) wage subsidy system. 

I won't accept that it is tougher to run a restaurant in NY/LA/Miami than it is in Paris/London/Sydney. Either Paris/London/Sydney restaurants are running much better businesses or NY/LA/Miami restaurants are making a motza. 

FIFA is corruption professionalised. Mandatory 20% tipping rules don't fall far short to my eyes. It shouldn't be up to visitors to subsidise a services wage system that is clearly unfit for purpose in the modern world. 

[gillmiller]

Ridiculous!  Automatic gratuities can definitely be confusing, especially when they aren't clearly explained beforehand. I don't mind tipping for good service, but I like knowing exactly what I'm being charged for. Restaurants really need to make these policies more obvious. I had Libetry Tax https://liberty-tax.pissedconsumer.com/review.html on my mind earlier and somehow ended up reading about restaurant fees instead. Funny how one topic leads to another online. Transparency is always the best approach.

[anacostiakat]

A pox on them!  

[BrightonCorgi]

How nice of themselves to add 20% to the bill.

[LizardGizmo]

13 hours ago, Çnote said:

A very fine point in federal labor law, a 'gratuity' goes 100% to staff. A 'service charge' may be held by the house for arbitrary dispersal.

This point is the one that has been driving me crazy recently - with business owners doubling down on trying to screw their staff.

As Cody noted, I've now noticed that the included "18-20% tip" is slyly changing at some restaurants to a mandatory "18-20% service fee" which allows the proprietor to either participate in the additional fee collection themselves OR skirt the responsibility of sharing the "tip" with the server entirely...which of course is a cruel and deceptive practice.

There have been many complaints here in the US recently - without any legal recourse because it's not called a 'tip' - that mandatory "service fees" do not end up in the pockets of the people doing the service. If I see "service fee' on the bill now, I ask the server directly if they're getting the service fee money. If not, I will go to an ATM and pull cash out and hand it to them.

I was told at one spot that 0% of the service fee went to the servers and I then I forced the manager to take the fee off my bill. I handed the server a $50 and I haven't gone back.

This is somewhat irrelevant to the discussion, but I checked myself out at a Panera Bread last week (don't ask - I was desperate) and was suggested to provide an 18%, 20% or 25% tip before I could tap my card. I didn't see or speak to a single human being from the moment I walked in the store to the moment I left. 

[Çnote]

12 hours ago, LizardGizmo said:

There have been many complaints here in the US recently - without any legal recourse because it's not called a 'tip' - that mandatory "service fees" do not end up in the pockets of the people doing the service. If I see "service fee' on the bill now, I ask the server directly if they're getting the service fee money. If not, I will go to an ATM and pull cash out and hand it to them.

I was told at one spot that 0% of the service fee went to the servers and I then I forced the manager to take the fee off my bill. I handed the server a $50 and I haven't gone back.

This is somewhat irrelevant to the discussion, but I checked myself out at a Panera Bread last week (don't ask - I was desperate) and was suggested to provide an 18%, 20% or 25% tip before I could tap my card. I didn't see or speak to a single human being from the moment I walked in the store to the moment I left. 

All this is very true. I'm currently reviewing service complaints from Saturday night. None from my sections. Chances of a cigar tonight are getting very high, even in this heat.

[BrightonCorgi]

Highly unlikely you'll see me dine twice at place that gets cute with fees or virtue signals on how that money goes to all their staff. You're supposed to pay your staff. You shouldn't get a pat on the back for this.  

A straight percent tip on wine is not fair either. Gets into a money grab scam at that point.  

[Çnote]

8 hours ago, BrightonCorgi said:

A straight percent tip on wine is not fair either. Gets into a money grab scam at that point.  

I'm both ways on this particular point. I personally wouldn't order expensive wine in the USA, it's cheaper to fly to Europe at that rate, or have the chef come and mess up your kitchen. Brisbane had a couple bottles I almost threw down on. A reasonable tip on the bottle to an experienced sommelier is always nice, but those % metrics I mentioned above can be brutal at the high end, unfortunately. Can't make everyone happy all the time.

I thought about this story when closing my eyes this morning, and we're in the sandbox to tell it. A well-known, well-heeled wine collector in Dallas with a penchant for Petrus had several times over the years told the owner of a fabulous wine list that one day he would come in a drink a particular bottle, something in the line of $5-6k (this was a minute ago, maybe late '90s or early '00s). One slow weekday, late lunch, a very junior server opened this legend to be served with a chix-caeser on a table of one. One plate, one bottle, $100 tip. No server in their right mind would complain about the %. This one did, and he was shown the door. I'm grateful for every gratuity. Sometimes the math isn't great, but you'll get another at-bat and everything will work out. .400 is guaranteed hall of fame, and certainly act like you've been here before.

[99call]

Interesting thread

I think as a society we desperately need to recalibrate. What does a genuine entrepreneur look like? And what does a grifting thief look like?

As I've argued with Rob in the past, I'm not anti business, nor anti (more respectable forms) of capitalism. If someone is working hard to bring a good product or service to the marketplace, if they are employing people with a fair wage. If there business model allows for social mobility and a career pathway...then good on them, bravo.

Many see the word 'opportunist' as compliment, a 100% positive descriptor. In life we can sometimes be presented with open goals, opportunities to simply kick the ball in the back of the net. However, If that opportunity means subjugating, victimising, or taking advantage of someone else, (then me personally) I'm happy to walk past that goal mouth, be poorer for it financially, but richer in self respect, decency and dignity. More importantly, I will not have taken advantage of someone in a vulnerable position. 

I think as a society we need do away with the notion that people working corrupt grifting angles for profit, has any element of respectability attached to it. It doesn't.

As a foodie, and having worked as a chef for about 10yrs in my first career, I don't want to sense desperation or fear from a waiting on staff. Growing up in Europe, the very best experiences of service I've have been there, and in Japan. I don't want staff to be engaging with me in a fake dance of faux friendliness, for the explicit purpose of tips. It's grim and depressing for me, and it's grim and depressing for them. The best service I've had are from 'Intuitive ghosts'. Observant, socially intelligent they are able to see the restaurant, it's patrons, and tend to everyone in a quiet, slick, non invasive, stylish choreography.    

My intention if I'm going out for a nice meal, is a bottle of white with entrees & seafood starters. A bottle of red with mains, dessert wine with pudding/cheese board, coffees, calvados, cigars...etc. I will say this. 95% of the time, the option to have that old school dining experience is ruined by s***ty, hectoring service, that just want as many sittings as possible. You think WTF? I'm trying to spend money in your restaurant. Why are you trying to turn over a table, that's still spending?

My preference is pay good staff, a good wage, with tips on top. Let them work with motivation, happiness and respect in their veins, not desperation and fear. When service is classy, polished and delivered with poise, always happy to leave a good tip on top. When it's hectoring, desperate, insincere, I just want to get out of the restaurant as soon as possible. 

[BrightonCorgi]

My cousin is retired from being a waiter at The Capital Grille. He used to be the general manager of Cafe Budapest. Very famous high-end dining in Boston that closed down when the lease ended and building owners wanted to do something else.

He's the one that put it in my head that tipping a straight percent on wine is absurd many years ago. Paying $100 tip for a $500 bottle of wine; no way. That's 50 beers at $10 each which certainly warrants a $100 tip for the server.

[Chitmo]

I have big beef with tipping, if you can’t afford to pay staff a livable wage with your business model it should not be on the customers to make that up. If it’s not viable model then move on and look at another industry. Servers being at the mercy of someone else’s goodwill shouldn’t be a thing. 

[ha_banos]

Just a thought about opportunists. Organised crime. I wonder how many cafes and restaurants are run by OCGs these days in cities? There are a lot of cafes around me that are totally suss...And I bet they don't care for staff too much.

Deputy Commissioner Nik Adams, City of London Police and National Police Chiefs’ Council Lead for Financial Investigation and Asset Recovery, said:

Our high streets should be places where legitimate businesses can grow, not places where organised criminals hide behind shopfronts.

In north London specifically, major historic and ongoing operations have intercepted independent cafes (such as high-profile cases along the Holloway Road axis) acting as front-facing financial hubs where international drug money was systematically layered through money transfer systems disguised as neighborhood delicatessens.

[Fuzz AI]

8 hours ago, BrightonCorgi said:

My cousin is retired from being a waiter at The Capital Grille. He used to be the general manager of Cafe Budapest. Very famous high-end dining in Boston that closed down when the lease ended and building owners wanted to do something else.

He's the one that put it in my head that tipping a straight percent on wine is absurd many years ago. Paying $100 tip for a $500 bottle of wine; no way. That's 50 beers at $10 each which certainly warrants a $100 tip for the server.

I get you. There is no difference in time and effort in serving a $20 bottle of wine compared to a $200 bottle. 

I was at a Viet/Jap fusion restaurant over the weekend and we had several bottles of sake. A few small bottles that were going for $50-80 and one large 700ml bottle that was $80. All were served in exactly the same manner regardless. Mind you, I did find it odd that this place actually had tipping on the card machine. Most Japanese places don't do it. I guess that was the "fusion" part.

[Chibearsv]

I was taught that tipping 15-25% of the check (no matter the items on it) is expected by anyone that serves you and should be paid. I’m not tipping more than a couple bucks at a buffet or anywhere else I have to retrieve my own food. Aside from that, 15% is my minimum. 25% for attentive, polite, quality service. I don’t see any issue with 20% mandatory if it’s going to the servers. If it’s a restaurant grab because of temporary big event, then tipping the servers on top of that is appropriate. Ask the manager when in doubt. If you can’t tolerate that, order carry out.