Anyone Else Frustrated By This "service Charge" Concept In Thailand?

[andyww]

Many years ago there was a campaign by the Evening Standard newspaper in London, on this very subject. The basis of the campaign was that many restaurants added a clearly stated service charge, which was OK, but that the readers should send in names of any restaurants they found adding a service charge AND expecting a tip by means of an extra "tip" line on the bill or credit card slip (this was before the days of those hand-held machines).

The principle is service charge OR tip, not both.

[tw25rw]

Many years ago there was a campaign by the Evening Standard newspaper in London, on this very subject. The basis of the campaign was that many restaurants added a clearly stated service charge, which was OK, but that the readers should send in names of any restaurants they found adding a service charge AND expecting a tip by means of an extra "tip" line on the bill or credit card slip (this was before the days of those hand-held machines).

The principle is service charge OR tip, not both.

It's a misguided principle. waiting staff don't work for free in hope of getting tips. They work for a salary and tips supplement that.

Service charge covers the salary and isn't voluntary. Tipping is a bonus for good service and is voluntary. The mistake is in itemising service charge as it makes people think they are paying too much.

[kikoman]

Many years ago there was a campaign by the Evening Standard newspaper in London, on this very subject. The basis of the campaign was that many restaurants added a clearly stated service charge, which was OK, but that the readers should send in names of any restaurants they found adding a service charge AND expecting a tip by means of an extra "tip" line on the bill or credit card slip (this was before the days of those hand-held machines).

The principle is service charge OR tip, not both.

It's a misguided principle. waiting staff don't work for free in hope of getting tips. They work for a salary and tips supplement that.

Service charge covers the salary and isn't voluntary. Tipping is a bonus for good service and is voluntary. The mistake is in itemising service charge as it makes people think they are paying too much.

I if charged a service charge I never leave a tip, in fact the whole idea of tipping for eating in a restaurant to help management pay its staff is outrages, if a person can not pay his staff a proper wage, they should not be in the business. it is not my duty to pay his /her staffs wages as a right to eat in their establishment, I only tip for good service, if the service is not good, no tip-Simple.

Cheers:

[ivowatson]

I know for a fact that many, many (my guess is most) do NOT. Other places use it to replace broken dishes and mistaken orders - and such - that should be the restaurant owners responsiblility.

I know for a fact that most (if not all) hotels in Phuket pay the service charge to the staff.

[tw25rw]

I if charged a service charge I never leave a tip, in fact the whole idea of tipping for eating in a restaurant to help management pay its staff is outrages, if a person can not pay his staff a proper wage, they should not be in the business. it is not my duty to pay his /her staffs wages as a right to eat in their establishment, I only tip for good service, if the service is not good, no tip-Simple.

Cheers:

Any time you buy anything, you pay for the cost of bringing it to you whether you see it or not. There is no principle at stake here. No one is double dipping at your expense (well, the food may be overpriced, but that's a different matter again). Service charge goes towards the minimum wage salary to keep them on the premises. The tip is a voluntary bonus for doing their job well.

[jayjayjayjay]

I actually like the places who jam on the 10% service charge, I dont feel in anyway obliged to leave a tip !!

Agreed, just don't leave a tip. If they don't pass it onto there staff then the staff can and will leave.

[hammered]

I tend to not go back to places where I dont like the price and those I attend regularly usually give a 10% discount (mostly the kind of places middle class Thai people would go)

I nearly always tip as I nearly always get what I regard as good service and tip to the waiter/waitresses hand rather than the table if the service from that person has been very good.

Edited March 2, 2010 by hammered

[manjara]

If there is a Service Charge of 10% I usually read it as, 'Please do not leave a tip as it is already included at a rate of 10%'

If the service was really very good I might leave more on to, but typically if there's a service charge then that's my tip!

It definitely makes me less likely to return to that place as well, so from the restaurant view it is not a particularly good idea, I would say.

[bkkjames]

I was staying at a hotel in Pattaya on the weekend and all the bills I signed included to the room included 10% service charge +7% VAT.

Interestingly though, when I checked out and gave them my Amex - the printed out slip that I had to sign had a blank space with area for tip to be written in and an area on bottom for me to write in the final total.

Needless to say - that space for tips was left untouched and the balance owning was what I signed for.

Perhaps a few people fall for this?

[Lammbock]

10% yes or no. If i happy with the Waitress she get her tip straight into her hand from me.

[nakachalet]

I actually like the places who jam on the 10% service charge, I dont feel in anyway obliged to leave a tip !!

well... that is no way to 'stick it' to the establishment, friend....

the people who waited on you is still without the peculiar gratitudes....

especially in thailand.... the establishment usually would just pocket the 10% into its own acct rather than handing it back to the poor waiters and waitresses....

it is a sad norm here.... little people like waiters and waitresses do count very little.... very sad situation....

but we always have the waiters and waitresses share their good will collection at the end of each shift.... without any interference from management.... no, this is an exception and not the norm for sure....

Edited March 2, 2010 by nakachalet

[Ulysses G.]

I know for a fact that many, many (my guess is most) do NOT. Other places use it to replace broken dishes and mistaken orders - and such - that should be the restaurant owners responsiblility.

I know for a fact that most (if not all) hotels in Phuket pay the service charge to the staff.

Perhaps, but how about all the 1,000s of restaurants?

Edited March 3, 2010 by Ulysses G.

[Alex8]

That change is provided to the employees

that's the way it should be but many places are refraining from giving that change to the end user,as the tips for example, many unscrupoulous entrepeneur are deprivating their staff even of this international "institution" and i am not talking specifically of Thailand, happens in Europe too.

I, as a UK national, currently domiciled in Thailand, understand matters in Europe, most continental countries include the service charge in the published price so no tip is necessary. You can even demand removal of that 10 - 15% service charge if you are seriously dissatisfied with the service or the product. You are, of course, free to tip extra if you think service or product outstanding.

In the UK, however, the isissue is a jar of worms. The law states that service is included in the published menu price unless the menu contains a clear footnote that service comes extra. You, the diner, are responsible for having seen and agreed that note before you place your order.

The mischief arises in two, even three ways. Should you elect to pay by credit or debit card, the bill can often be left blank, on the bottom line, inviting you to add an additional tip. It might be illegal if you have failed to understand the foregoing. It is an easy trap for management and attempts to exploit your possible embarassment.

It is also, effectiverly, a double surcharge. You must understand that any percentage demanded or volunteered ought not be paid on the VAT content.

Should you so wish to offer any sum for service, you should first remove the VAT, then work out a suitable percentage on the net cost of the meal.

The third scam might be a waiter/waitress who takes your credit/debit card, out of your sight, and swipes it with a card reader, to be used quite quickly to strip your account.

IMHO.

Alex8

[davejonesbkk]

It is common worldwide in place for Tourists.

Additional often the prices are also without tax.

Why not add a meat surcharge, a cooking gas surcharge, a handling surcharge. a sitting surcharge, a dish washer surcharge......

Exactly, its a joke. And all this talk of helping with the books is BS too, sorry but I am not there to make your monthly accounting easier, if you are running a business then hire a dam_n accountant

[Furbie]

What I'm more upset about is all these places that think they can increase my charges 3% just because I use an international credit card. I can't count the amount of times I've completely turned down a $3000 purchase on my business credit cards because they want to add about $100 to the bill. I usually threaten to get their merchant accounts shut down with the credit processor (I have good business relations with Visa, Mastercard and AMEX). Some of them just look at me like... what are you talking about? "It's illegal to do that? But they charge us to process payments this way... It can't be illegal!"

The service charge idea for me is fine, though. It's just like another tax, and usually they'll split it through to the staff, so no problems there. In most instances its written in small writing on the bottom of the menu. Have some class, stop biotching, and give them 20 baht for your 200 baht tab... what is that? 0.70 USD.

i always thought they charged 3% extra on all credit cards transactions,whether international or not, as its a merchant charge, i could be wrong thou

It is on ANY credit card -- local or international -- and it is NOT illegal for most small businesses -- if you have such good relations with VISA and the others, you would think they would tell you the truth -- small businesses are PERMITTED to add a service charge to cover the 2.5 to 4% charge the card companies charge them.

This has been in no merchant agreement I have ever seen - I have only seen it say its a violation of the agreement to do this. Granted, I have not seen one in Thailand for a small business, but I have noted that they do not clearly show a credit card fee on your bill. I would assume you could forward that on to your credit card company and dispute it.

[Furbie]

I actually like the places who jam on the 10% service charge, I dont feel in anyway obliged to leave a tip !!

well... that is no way to 'stick it' to the establishment, friend....

the people who waited on you is still without the peculiar gratitudes....

especially in thailand.... the establishment usually would just pocket the 10% into its own acct rather than handing it back to the poor waiters and waitresses....

it is a sad norm here.... little people like waiters and waitresses do count very little.... very sad situation....

but we always have the waiters and waitresses share their good will collection at the end of each shift.... without any interference from management.... no, this is an exception and not the norm for sure....

I don't like this charge, but I do know a lot of establishments that pass it on. In particular, the large hotels do, and as noted by many others, it makes up a portion of staff salaries. Additionally, I know of several restaurants where the staff received it - not just the waiters, but the entire staff. I have also been to places where the staff said they do not get it. On fear of being flamed, the places that give it to their staff were operated by Westerners, the ones who did not (though not all) were not Western owned.

Eat at Soi 8 pub if you wish to avoid the charge.

[bkkjames]

I actually like the places who jam on the 10% service charge, I dont feel in anyway obliged to leave a tip !!

well... that is no way to 'stick it' to the establishment, friend....

the people who waited on you is still without the peculiar gratitudes....

especially in thailand.... the establishment usually would just pocket the 10% into its own acct rather than handing it back to the poor waiters and waitresses....

it is a sad norm here.... little people like waiters and waitresses do count very little.... very sad situation....

but we always have the waiters and waitresses share their good will collection at the end of each shift.... without any interference from management.... no, this is an exception and not the norm for sure....

I don't like this charge, but I do know a lot of establishments that pass it on. In particular, the large hotels do, and as noted by many others, it makes up a portion of staff salaries. Additionally, I know of several restaurants where the staff received it - not just the waiters, but the entire staff. I have also been to places where the staff said they do not get it. On fear of being flamed, the places that give it to their staff were operated by Westerners, the ones who did not (though not all) were not Western owned.

Eat at Soi 8 pub if you wish to avoid the charge.

and the Pomodaro Italian Restaurant opposite side next to bts nana station doesnt either.

[frenchfarangjomtien]

I hate this service charge thing as a principle.

Prefer to eat somewhere else when it's an expensive place and they dare to charge me even more using this service charge trap...

[stub]

Its an annoying concept imported from overseas - a compulsory tip. Just don't tip (you already have!), and don't go back if you hate being lied too. There are enough decent places to eat and stay without supporting this fraud. Some countries listen to their consumers and list prices have to include any service charges and taxes.

Its weird how some owners never realize that importing dubious business practices from their home countries causes resentment in their customers from different cultures. They can't comprehend that their 'normal' business practices and a 'minor' issue like this lose them customers. Thankfully in Bangkok you can vote with your feet and there is always an alternative, often located just a few doors down.

And well done to Bradman's for clearly stating everything clearly and unambiguously at the front of the menu for the international audience. Price charged is price listed, tips go to staff, suggested tipping rates for good service.

(Just my $0.02++)

[caf]

What I'm more upset about is all these places that think they can increase my charges 3% just because I use an international credit card. I can't count the amount of times I've completely turned down a $3000 purchase on my business credit cards because they want to add about $100 to the bill. I usually threaten to get their merchant accounts shut down with the credit processor (I have good business relations with Visa, Mastercard and AMEX). Some of them just look at me like... what are you talking about? "It's illegal to do that? But they charge us to process payments this way... It can't be illegal!"

The service charge idea for me is fine, though. It's just like another tax, and usually they'll split it through to the staff, so no problems there. In most instances its written in small writing on the bottom of the menu. Have some class, stop biotching, and give them 20 baht for your 200 baht tab... what is that? 0.70 USD.

i always thought they charged 3% extra on all credit cards transactions,whether international or not, as its a merchant charge, i could be wrong thou

It is on ANY credit card -- local or international -- and it is NOT illegal for most small businesses -- if you have such good relations with VISA and the others, you would think they would tell you the truth -- small businesses are PERMITTED to add a service charge to cover the 2.5 to 4% charge the card companies charge them.

This has been in no merchant agreement I have ever seen - I have only seen it say its a violation of the agreement to do this. Granted, I have not seen one in Thailand for a small business, but I have noted that they do not clearly show a credit card fee on your bill. I would assume you could forward that on to your credit card company and dispute it.

In the Uk they are NOT permitted to do that. The credit card charge must be the same as for a cash purchase. They can of course refuse to serve you and you are then able to go elsewhere.

Example, if you see goods at £10 and take them to the till and they process the transaction then it must be for £10. cash or credit card

If before ringing up the item they decline to serve if you wish to pay by credit card that is not in itself illegal. Because at that point the store has not agrred to accept your offer of purchasing the item. The price in the item is merely an " invitation to treat" and not binding.

caf

[stub]

I actually like the places who jam on the 10% service charge, I dont feel in anyway obliged to leave a tip !!

well... that is no way to 'stick it' to the establishment, friend....

the people who waited on you is still without the peculiar gratitudes....

I assume any place withholding the service charge from the staff will also screw them by keeping the tip box contents too. Maybe cash in the hand might work if the boss isn't watching.

[Birdman]

A Western invention, unhesitant absorbed here before and now.

Edited March 3, 2010 by Birdman

[stub]

What I'm more upset about is all these places that think they can increase my charges 3% just because I use an international credit card. I can't count the amount of times I've completely turned down a $3000 purchase on my business credit cards because they want to add about $100 to the bill. I usually threaten to get their merchant accounts shut down with the credit processor (I have good business relations with Visa, Mastercard and AMEX). Some of them just look at me like... what are you talking about? "It's illegal to do that? But they charge us to process payments this way... It can't be illegal!"

Its not actually illegal. It is in violation of the agreement between the merchant and the credit card company. Some jurisdictions have declared this unenforceable, and merchants are allowed to pass on the cost to the customer while the card companies can't do anything except whine or perhaps offer incentives for hiding the cost. In other jurisdictions, the card company will disconnect the merchant, possibly even keep owed cash and the courts will back them up. Depends on the country. I have no idea what the rules are in Thailand, but I expect they would favor local merchants over the large western financial institutions.

I personally agree with merchants having the power to pass on the cost. For a while back home it was common to see a 1.5% AMEX charge because American Express at that time was charging higher fees and the shops decided to do something about it.

Edited March 3, 2010 by stub

[Ulysses G.]

I don't like this charge, but I do know a lot of establishments that pass it on. In particular, the large hotels do, and as noted by many others, it makes up a portion of staff salaries.

These establishments should be paying staff salaries out of their own pocket, not using a "service charge" to pay them and screwing the staff out of the extra tips that they lose because the public thinks that they are getting the service charge already.

[skippy]

How do all you folk tip back in Margate ?

[thaihome]

A Western invention, unhesitant absorbed here before and now.

I’m not so sure. Never saw the 10% service charge before I came to Asia. First saw it in Singapore, where everything is priced "++" meaning VAT and Service Charge not included.

I think it is a Chinese invention.

TH

[moetownblues]

The new overpriced water park in Phuket charges a "service charge" and with that you get..............no service.

wow nothing for something

[BSJ]

Being an Aussie I am tight with giving tips. But I would rather no service charge and the right to tip for special effort or extra good service.

[ivowatson]

I know for a fact that many, many (my guess is most) do NOT. Other places use it to replace broken dishes and mistaken orders - and such - that should be the restaurant owners responsiblility.

I know for a fact that most (if not all) hotels in Phuket pay the service charge to the staff.

Perhaps, but how about all the 1,000s of restaurants?

95% of the restaurants don't charge service charge so perhaps they don't pay it to the staff.

[somefellow]

DOES ANYONE KNOW THIS????

TIPS

TO

INSURE

PROPER

SERVICE

Wow made this post and checked back, see lots of replies.

I think people have pretty much said it all, so I have not much more to add, except....

if TIPS meant "to insure proper service", it would mean writing an insurance policy regarding proper service, i.e., the insurance will pay out if the service fails or something like that.

Also, the word is "tip" and the plural is "tips". The S in "tips" serves the function of pluralizing "tip". Doesnt stand for service.

We would give TEPs if it meant what Loz suggests, or actually TEPSes.