Restaurant surcharges & service charges: threat or menace?

I’d complain to management about a double service charge. Maybe it was intentional gouging, maybe it was misconfiguration of their ordering / point-of-sale system.

In California, mandatory service charges must be applied before sales tax, as they’re taxable, so at least in part they’ve got things set up wrong.

2 Likes

It’s farkakte, brazen, and absurd. Should have gone to Maury’s but family wanted Courage, so they had me over a barrel.

@robert Is there a state or local agency that oversees/regulates complaints on this stuff?

2 Likes

The Franchise Tax Board for sales tax violations. There’s no law imposing any maximum on service charges.

1 Like

Yes, You Should Still Tip 20% on Top of a Restaurant’s Service Charge

Says Bon Appetit

I’m calling bullsht that the magazine staff is perfectly okay with a combined 40% surcharge :roll_eyes:

4 Likes

“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.”

Bullshit. I have good reasons to distrust the Jon & Vinny’s restaurants, or any other restaurant that charges a service fee in the 15-20% range, doesn’t disclose exactly what they do with it, and then encourages or allows servers to encourage a 15-20% tip on top of that.

6 Likes

that bon appetit piece is some low-key propaganda trying to normalize big percentage ‘service charges’ that take advantage of the assumption that the entirety of the ‘service charge’ is going to the waitstaff and cooks. what percentage of restaurants with service charges distribute it entirely to workers?

"When Naran debuted Pijja Palace in LA’s Silverlake neighborhood last year, he implemented a 19% service charge to boost worker pay without increasing hourly rates beyond what he could afford for his team of 40-plus people. Pijja Palace’s charge is not optional for diners. It’s listed on the bill above a field for tipping. And while tipping is optional, it is still encouraged and gets distributed among front-of-house staff—with a small percentage of the service fee being split between cooks and the management team. "

my default assumption is that restaurants are hard businesses to run and if they feel like they need to play these games to pay their workers more, then i’ll go along with it. but if owners want to make more profit for themselves, they should have the courage to list higher prices on their menu

5 Likes

Somewhat apropos:

https://www.sfchronicle.com/politics/article/san-francisco-marriott-tips-18000567.php

4 Likes

The state should have a law like Oakland’s.

Service Charges shall not be retained by the Hospitality Employer but shall be paid over in their entirety to the Hospitality Worker(s) performing services for the customers from whom Service Charges are to be collected. No part of these charges may be paid to supervisors except for any portion of their work time spent on nonsupervisory work serving these customers, and then at no higher rate of compensation than the average of what is paid other Hospitality Workers performing similar customer service. The Service Charges shall be distributed to the Hospitality Workers not later than the next payroll following the work or collection of the charge from the customer, whichever is later

4 Likes

This isn’t related to restaurants, though what’s your tipping policy for ride share?

My brain hurts deciding whether to tip, and how much to tip.

I got free ride share credits since Tesla is in the shop, so I’m using it more often.

1 Like

I tip $5 on my usual fares of $10-15 since Uber and Lyft rip off the drivers so badly.

2 Likes

I typically do 15-20%, excepting fares < $10, where I’m usually tipping $2-$3. The compensation is quite low, and Uber claims to keep roughly 25% of the fee charged, but in actuality it’s often more than 50%.

Welp looks like I’m boycotting mother wolf until further notice too.

4 Likes

Wow, not surprising but still stunning, well done piece by the LA times. I’m guessing this won’t be the last of these either

3 Likes

In California, courts long held that mandatory charges cannot be considered gratuities under the labor code. That changed in 2019, when the law on service charges became clearer in the San Francisco case O’Grady vs. Merchant Exchange Productions Inc. In that case, a state appeals court ruled that service charges belonged to the employees under California law if customers could reasonably be led to believe the charges are tips. The ruling applies to all food and beverage establishments.

That ruling was tested as recently as April 19, when a San Francisco judge ruled in a nonjury trial that a Marriott hotel in downtown San Francisco must pay around $9 million in withheld service fees to staff who served food and drinks at banquets.

The case pivoted on whether such fees are reasonably considered by customers to be gratuities. In April 2017, the San Francisco hotel began expressly telling banquet diners that the tacked-on fees did not constitute gratuities, freeing itself from future liability.

Based on the above text, looks like someone fixed this on the menu. Someone should audit that 20% though.

image

1 Like

This shit is why I’m so skeptical on tipping. I don’t trust where that money is going to. I don’t want my money to fatten some rich guy’s pockets.

I always press no tip whenever I see them on iPads.

5 Likes

Interesting that Mother Wolf’s in trouble only because it’s connected with a hotel. No problem for the Jon & Vinny’s group.

That 5% blurb is exactly what’s quoted in the article.

1 Like

Then what case do they even have.

The case pivoted on whether such fees are reasonably considered by customers to be gratuities

Different case. The allegation by former employees of the Mother Wolf group is that the 5% was apparently not going to health benefits for the staff, or to the staff at all, as required by a local ordinance.

2 Likes

Of course. Thats why i tip cash to the server personally. Fingg j rip offs . A gratuity is made to rhe employees not the employer

5 Likes

13 Likes