Restaurants Charging 10 Percent Service Charge And Not Giving It To Their Staff

[StreetCowboy]

I also believe Thai system is geared towards decent base salary .

This statement kind of defeats the rest of your argument.

I don't see Thai's tipping in Thai places nor i see any service charge added etc. I.e. i believe Thai's have not traditionally used system where restaurant staff earns a living from tips or service charges. And i'm talking restaurants now, not beer bars or gogo's where they indeed get paid "commission" on drinks and other services.

Not an expert on Thai culture so correct me if i'm wrong. It just something i haven't seen.

Let's put it this way.

Let's say a employee is getting paid 15k a month. If he/she works in restaurant you feel obliged to tip her 20% on top salary. If there is service charge added you question the manager and name and shame here if it is not given to employees.

If he/she works in department store with same money do you still tip her 20% on your purchases. No you wont. Just because it's not a restaurant. Actually you find it outrageous if staff at department store would demand tip from you.

You continue to behave as you were still in Kansas. That's how you are programmed. Nothing bad about it, we all do the same in certain issues regardless where we come.

It seems that "i wont get it" regardless of how much we debate. But honestly, this is the opinion of someone not coming from the US system of having restaurant staff to work on commission basis. You asked for opinions so there you have it.

I think its (service charge) a win-win to tie the pay to the staff to the turn-over of the business.

When you can afford it, and the staff are busy, they get paid well.

When times are hard, they share the pain (and perhaps find it easier to find a job with a successful business). There's nothing worse than being paid too much for being unproductive in a job you don't enjoy.

I just wish prices were quoted inclusive of service, tax and fuel.

SC

[DP25]

Thais do tip in restaurants, it's not just for foreigner. Not much, but they will leave a 20 baht tip or their left over change for a meal. For example if the bill is 375 baht most people would just leave 400, so the waiter would have a 25 baht tip. They don't calculate a certain percent of the bill for the tip like Americans would, but it's normal to leave something. Thais also tip in bars, if you order a bottle of whiskey it's normal to tip your waiter a 20 baht or two for taking of your table.

[Jingthing]

Thais do tip in restaurants, it's not just for foreigner. Not much, but they will leave a 20 baht tip or their left over change for a meal. For example if the bill is 375 baht most people would just leave 400, so the waiter would have a 25 baht tip. They don't calculate a certain percent of the bill for the tip like Americans would, but it's normal to leave something. Thais also tip in bars, if you order a bottle of whiskey it's normal to tip your waiter a 20 baht or two for taking of your table.

Agreed. But the topic isn't about tipping cultures. The topic is about places that do take a mandatory "service charge" and may not actually give that extra money to their staff.

[MJo]

Thais do tip in restaurants, it's not just for foreigner. Not much, but they will leave a 20 baht tip or their left over change for a meal. For example if the bill is 375 baht most people would just leave 400, so the waiter would have a 25 baht tip. They don't calculate a certain percent of the bill for the tip like Americans would, but it's normal to leave something. Thais also tip in bars, if you order a bottle of whiskey it's normal to tip your waiter a 20 baht or two for taking of your table.

That is true.

However it is just some extra money and more of sign of appreciation. It's not something the staff considers as part of their salary. Like in US.

[Jingthing]

Thai waiters are generally paid poorly. I think it is elitist out of touch bullcrap to suggest they don't need tip money or forced tip "service charge" money just to maintain their lives. Of course if they're working in a street stall, it will be nothing, but places up from that, it will usually be something. I know from Thai waiters ... they need the tip money.

[MJo]

So are many more, department stores ladies, factory workers and the list is endless. Yet you don't tip them when buying now clothes etc.

I leave the coins and the extra 20 baht in restaurants and in taxi. Unless it's bigger party and we spend whole night eating and drinking then it's more. Now this is what i have observed my Thai friends to do as well.

Now JT brace yourself as i'd assume cheap charlies being here any minute now telling you off for spoiling the market with your excessive tipping

[bkk_mike]

Thais do tip in restaurants, it's not just for foreigner. Not much, but they will leave a 20 baht tip or their left over change for a meal. For example if the bill is 375 baht most people would just leave 400, so the waiter would have a 25 baht tip. They don't calculate a certain percent of the bill for the tip like Americans would, but it's normal to leave something. Thais also tip in bars, if you order a bottle of whiskey it's normal to tip your waiter a 20 baht or two for taking of your table.

That is true.

However it is just some extra money and more of sign of appreciation. It's not something the staff considers as part of their salary. Like in US.

The issue in the US isn't really that the staff assume the tip is part of their salary. It's that the IRS assumes it is, and makes an assumption that the tip is 15%.

This results in US restaurants having waiters who won't serve Japanese customers (who grew up in a country with no tipping), because they have to pay tax on a tip that might not be received...

Personally, if I see a service charge I don't tip, on the assumption that the service charge goes to the staff. However, I have a niece who is studying in the UK and who works in a restaurant part-time, and at that restaurant, the owners keep the service charge, which I've told her is not the way it's supposed to be there...

[MJo]

That is one of the problems in the US system. Not served and your country men are know to for small tips.

Although when in Rome.... so they should know the custom in US and tip. I do tip when in US based on advice on my local friends.

But still i would not give my business for a restaurant paying below minimum wages and expecting me to tip in my home country. With service charge included or added to the price no probs as long as shown in menu.

Different places different rules.

[Jayman]

That is one of the problems in the US system. Not served and your country men are know to for small tips.

Although when in Rome.... so they should know the custom in US and tip. I do tip when in US based on advice on my local friends.

But still i would not give my business for a restaurant paying below minimum wages and expecting me to tip in my home country. With service charge included or added to the price no probs as long as shown in menu.

Different places different rules.

Are you trying to say Americans are known for small tips? Considering that most of the tipping comes from Americans (it's part of our culture remember) I don't know how you can make that claim.

From what I understand, it's Americans that spread this stupid habit of tipping around the world. Some have said the Europeans started it for the American tourists. I've heard that for over 20 years. No idea if it has any basis in fact.

Edited February 12, 2012 by Jayman

[MJo]

I was referring to the Japanese not being served due to their small tips or not leaving anything at all.

[Jayman]

I was referring to the Japanese not being served due to their small tips or not leaving anything at all.

Ohh I misunderstood your comment. Not getting served for low/no tips is the LEAST of your worry in America. I am more concerned with what they do to my food before it gets to my table.

[MJo]

Must be all the typos

My pet hate is someone being in your table every 5 minutes asking how's it going, all in order and so on. Makes me tip less. But have to say i love how the bill comes automatic after being asked "anything else" without having to get someone to the table for just asking the bill.

Almost as good as making the "square" sign with your fingers in Phils.

[Ulysses G.]

I also believe Thai system is geared towards decent base salary .

This statement kind of defeats the rest of your argument.

Let's say a employee is getting paid 15k a month. If he/she works in restaurant you feel obliged to tip her 20% on top salary.

The problem with that theory is is that most of the restaurant staff are getting closer to 6,000 baht and having to put up with demanding customers who do not speak their language.

Thai customers often do tip, by the way, but usually not as much as Westerners.

Edited February 12, 2012 by Ulysses G.

[Mugg]

Op,you are obvious from the US,where as i understand it is required to tip in a restaurant.Do they ever add service charge to the bill in the US?

The Dept of Labor and IRS has a very clear explanation as to the difference.. a Tip is a gratuity to the server. This is not a service charge. So many do not tip when they see Service Charge included on the Bill. I know that one major chain has taken that Statement off the Bill, and the waitress actually pays a fee, much like a rental fee for her section. This makes the service and tips so much better. When you are working harder for tips amazing how the service improves.

[hhfarang]

I always thought the "service charge" was for the staff as well so when it is on my bill, I tip less. Without it I usually leave 10% for good service, with it I leave 5% or just the change depending on the service. I know several restaurant owners where I live and several restaurant service personnel and I have asked this question before. It is rare here that a restaurant pockets all of the service charge in my experience. Some do pocket half of it and half goes to the workers split among the servers and kitchen staff. I've heard of some where the entire service charge goes to the staff. Others with no service charge either let the staff keep their own tips or in the usual case where many staff work all tables, the tips are put together and divided among the staff at the end of the shift, again including the kitchen staff who otherwise have no chance of earning tips.

I think it is disgraceful for any place to add 10% and have it not go to the staff as this lessens tips which in many cases are more than salary. From now on, when I see a 10% service charge I will request to speak to whomever is in charge and ask where the money goes. If it goes to the owner, I will tip the staff appropriately according to the level of service I received and never return to that restaurant again.

[Honolulu]

Until reading this thread, I always assumed that the service charge was to replace the tip. In a restaurant there is the food preparation, the overhead, the service, and the entertainment. If they tack on a charge for the entertainment, it would be called an entertainment charge, and rightly so. Why would I assume that a service charge was for something other than the service?

Sounds like restaurant owners are taking a page from the used car salesman's playbook, and I will be boycotting the service charge from now on. I hope food servers do the same.TRUTH in advertising.

[MJo]

I also believe Thai system is geared towards decent base salary .

This statement kind of defeats the rest of your argument.

Let's say a employee is getting paid 15k a month. If he/she works in restaurant you feel obliged to tip her 20% on top salary.

The problem with that theory is is that most of the restaurant staff are getting closer to 6,000 baht and having to put up with demanding customers who do not speak their language.

Thai customers often do tip, by the way, but usually not as much as Westerners.

Not really, i just used 15k as sample. Could have used 6k or whatever. The point is that restaurant you tip but when purchasing other services where staff makes same kind of money you don't.

[wolf5370]

Actually this pisses me off a little - and I run a cafe! Service charge is a rip off pure and simple - if you like my service and get good service then tip the staff (in my cafe we put it in a tin and its shared by the cook and serving staff at the end of the month - usually a couple of days wages each give or take). The thing that annoys me is that the American idea of percentages (ever increasing thereof) - please guys leave it at home, the rest of the world wants to decide themselves how much, if at all, to tip. Thais generally leave the shrapnel (coins) - some restaurants are wise to this and give change instead of 20 or even 50 baht notes - Thais (I have noticed) simply remove all the change and leave a ten or two behind - farangs often seem to leave it all (or take the change and leave a 20). This is a western habbit, tipping everyone, most Thai places really do not expect it at all - its should be a bonus, a reward for good service, not a right and not part of the price. Just because you are intimidated into patying 20% ott to some miserable sod serving you burgers and fries at home, don't export it and make it an expectation here too. Thank you.

[Jingthing]

To be clear, I didn't start this thread in any way to advocate that people tip in Thailand based on percentages when they have a CHOICE of how they tip (places without a service charge). I agree there is no logic in exporting American or whatever tipping culture to Thailand. Thailand has its own tipping culture and I feel expats should attempt to follow the Thai tipping culture model, in Thailand. Of course, many people want to tip as they always have before, and I feel that's a personal choice and totally cool as well. In any case, when there IS a mandatory service charge, it IS based on percentage of bill, whether we like it or not, there is NO CHOICE. So I am saying when we are forced in this way to pay a mandatory service charge based on percentage, it sure would be nice to be assured that money is actually going to the service staff. That is all. (For now.)

[Ulysses G.]

Not really, i just used 15k as sample. Could have used 6k or whatever. The point is that restaurant you tip but when purchasing other services where staff makes same kind of money you don't.

So what? Other kinds of workers usually don't have to wait on and put up with demanding foreigners that do not speak their language.

[Jayman]

Actually this pisses me off a little - and I run a cafe! Service charge is a rip off pure and simple - if you like my service and get good service then tip the staff (in my cafe we put it in a tin and its shared by the cook and serving staff at the end of the month - usually a couple of days wages each give or take). The thing that annoys me is that the American idea of percentages (ever increasing thereof) - please guys leave it at home, the rest of the world wants to decide themselves how much, if at all, to tip. Thais generally leave the shrapnel (coins) - some restaurants are wise to this and give change instead of 20 or even 50 baht notes - Thais (I have noticed) simply remove all the change and leave a ten or two behind - farangs often seem to leave it all (or take the change and leave a 20). This is a western habbit, tipping everyone, most Thai places really do not expect it at all - its should be a bonus, a reward for good service, not a right and not part of the price. Just because you are intimidated into patying 20% ott to some miserable sod serving you burgers and fries at home, don't export it and make it an expectation here too. Thank you.

I'm American and I approve this statement

[MJo]

Not really, i just used 15k as sample. Could have used 6k or whatever. The point is that restaurant you tip but when purchasing other services where staff makes same kind of money you don't.

So what? Other kinds of workers usually don't have to wait on and put up with demanding foreigners that do not speak their language.

Really, your statement covers pretty much everyone in sales or services.

Maybe you have cracked the double pricing standard though, never realized we pay more because we are demanding, rude and speak weird languages. You won't see me complaining on farang prices anymore

[mca]

If you dine at an internationally managed hotel's restaurant the service charge will go to the staff. It's written into the staff's contract that they will receive a service charge as part of the benefit package along with annual bonus, health insurance, meals in the canteen etc. The Thai owner of one hotel in my experience was interested in having the company I worked for manage his hotel but was having problems getting his head round giving the service charge to the staff. He was politely informed that if he wanted to stick it in his pocket as opposed to passing it on to the staff then the chain would simply walk away from the management deal.Many local hotel staff change jobs not for extra pay but for the service charge on offer.

In a number of cases in a popular property it can double the salary of the junior staff.

Now as for Lek's Goy and Sticky Rice Emporium I can't say......................

[Jingthing]

...

Now as for Lek's Goy and Sticky Rice Emporium I can't say......................

That's good to know about international corporate type places, but please believe there are lots of very nice and popular places charging mandatory service charges that are not at that level, but also not local dives.

Speaking of which, today ...

I visited one of my regular places. A slick newish restaurant that charges a 10 percent mandatory service charge. I have not been tipping on top of that assuming it was in place of a tip and the waiters were getting the money.

Well, today, there was a new waiter who did the obnoxious Thai thing of standing at the table after bringing the change.

So I said to him, why are you waiting, I already paid the ten percent on the bill.

He said, no we don't get that.

So then I questioned him more closely to explain himself more clearly, and he made it clear, the waiters get NONE of it.

There were two other waiters around that I recognize, very sober, credible looking people (I wasn't so sure about this new waiter).

So I asked them, and they confirmed. They get not 10 percent. Not 5 percent. Rather 0 percent. -- NADA

One waitress DID say that some of the money is used occasionally for staff events; I assume she means company "parties" for the staff, NO CASH!

So I talked more, saying well European people see "service charge" and think that means it goes for a tip for the staff.

They agreed, they fully understood that. They made it clear many people are like me, see the mandatory service charge, and don't tip more.

So I said, this isn't fair to the customer or to the waiters -- you need to complain to your boss (EUROPEANS).

They got all nervous. We can't complain. We will lose our job. It was clear to me I had hit upon a BIG ISSUE for them and they were miserable about it.

I also realized even talking about openly was a dangerous area for them. The main reason it came up was the coarse waiting around for a tip behavior of the new waiter.

Now tell me this is a victimless situation? The owners are totally exploiting their staff on this, with the fear factor.

Even the customers that DO tip on top of the mandatory service charge probably mostly ASSUME the 10 percent is ALSO going to to the staff and may tip less.

Personally, not sure how am I going to react to my new consciousness of what some restaurants are doing here. Obviously, if I don't love their food, it's no issue, just don't go. But some of these places have food that I love. I have now decided that its better to know the information than not know it. Then what to do with the information? I guess it depends.

Edited February 17, 2012 by Jingthing

[Jayman]

I wish we could be more public about naming the establishments that are shown to charge a service charge and not give it all or any to the service staff. I do understand that it would quickly get this thread closed as we don't want to upset any (potential) advertisers.

[Jingthing]

I wish we could be more public about naming the establishments that are shown to charge a service charge and not give it all or any to the service staff. I do understand that it would quickly get this thread closed as we don't want to upset any (potential) advertisers.

Yes, I agree. But I guess we have to suck it up just like those exploited waiters. Deal with it, or leave.

[Wallaby]

I wish we could be more public about naming the establishments that are shown to charge a service charge and not give it all or any to the service staff. I do understand that it would quickly get this thread closed as we don't want to upset any (potential) advertisers.

Yes, I agree. But I guess we have to suck it up just like those exploited waiters. Deal with it, or leave.

Did you try raising the issue with the owners (if they were there)?

I would be mightily pissed off if I found out a service charge was lining the pockets of only the owners. That being the case the full charge should be on the menu, not some small print.

It's a bloody disgrace.

[Jingthing]

I wish we could be more public about naming the establishments that are shown to charge a service charge and not give it all or any to the service staff. I do understand that it would quickly get this thread closed as we don't want to upset any (potential) advertisers.

Yes, I agree. But I guess we have to suck it up just like those exploited waiters. Deal with it, or leave.

Did you try raising the issue with the owners (if they were there)?

I would be mightily pissed off if I found out a service charge was lining the pockets of only the owners. That being the case the full charge should be on the menu, not some small print.

It's a bloody disgrace.

While talking with the waiters, they made it pretty clear to me that for me to raise it with the owners may get THEM in trouble, in the sense that talking to me and revealing the truth was a kind of complaining about the job. I think they were right and the last thing I want to do is make things worse for them.

I totally agree the policy is a disgrace. It's stealing from the waiters and the customers, mostly I think assume its extra money for the staff whether they tip over it or not. In my view, its a false statement on an implied contract (the menu). If your order salmon and get bologna you don't expect to pay for salmon.

Edited February 18, 2012 by Jingthing

[ronz28]

Another red flag are tip jars. When you observe tip jars and a "captain" taking the orders while others bring the food out, etc., you might ask if the severs actually get any of the tip money. In some Thai owned restaurants they do not, but the severs dutifully deposit the money in the tip jars and never see any of it again.

[Jayman]

Another red flag are tip jars. When you observe tip jars and a "captain" taking the orders while others bring the food out, etc., you might ask if the severs actually get any of the tip money. In some Thai owned restaurants they do not, but the severs dutifully deposit the money in the tip jars and never see any of it again.

I was unaware of that practice. My wife once worked in a Thai run restaurant that had a tip jar and at the end of the shift all tips were shared among cashier,cooks, and service (basically all workers other than manager). Of course different restaurants do things differently as there are no regulations to this.

I will start asking more questions rather than making assumptions when it comes to where the tip money I give goes. Thanks for bringing this to our attention.

Edited February 18, 2012 by Jayman