Restaurant Fees as Substitutes for, or Additions to, Tipping

[KeithA]

I was reading the comments in the Rasika topic about RW being a good deal or not at it and other restaurants and then I read this article about restaurant fees/surcharges - https://dcist.com/story/24/01/23/dc-restaurant-fees-service-charges-lawsuits-travelers-united/. I'm curious what people think including those who run restaurants. I think (I may be wrong as I'm not in the biz) that restaurants may be scared of raising menu prices to cover additional costs because they think it will turn off customers but if everyone was required to list correct menu prices without additional surcharges, I think it would be better for all. No bad feelings by customers, no need to explain by staff, and no threats of lawsuits.  I've personally been surprised at some of the restaurants where I've been where the total per person cost is $50-100 and then after the fee/surcharge % is calculated it is only about $3-8 more per person. I can't imagine most people eating at pricier restaurants are going to skip a meal if the price difference is a few dollars. I mean whether an entree is $32 or 34 or a glass of wine is $12 or 14 dollars is likely a negligible difference for most diners. Granted people do notice when a price goes from $28 to $32 but I'm sure smart restaurant staff can adjust menu prices in ways that wouldn't turn off customers but still get that less than $10 per person without the confusing surcharges. Per my opening, I'm not in the biz and so open to critique by restaurants if there is some aspect I'm missing. 

I also think that with the surcharges, the article is correct that some people tip less if they have to pay a surcharge (whether rightly or wrongly described on the menu per the AG's advice). The whole point of getting rid of tipped salary was to give staff a steady paycheck and so if that means menu prices go up then they should go up. IMHO.

[Ericandblueboy]

"In order to ensure that our team earns a competitive wage, a 20% service fee will be added to the final bill.
This fee is not a tip"

This is on Xiquet's website.  Well.....there's no chance I'm going to pay a 20% service fee and a 20% tip.  In fact....if I pay a 20% service fee, I'm not leaving a tip.  Especially if it's $195 pp minimium before tax and service charge.  The menu states the price is not inclusive of tax and gratuity, but is it inclusive of the 20% service fee?  Confusing.

[DonRocks]

On 1/23/2024 at 1:59 PM, KeithA said:

I mean whether an entree is $32 or 34 or a glass of wine is $12 or 14 dollars is likely a negligible difference for most diners.

Marketers figured out long ago that $2.99 sounds like a lot less than $3.00.

Having come into this from the wine angle, I bristle at paying double (much less triple) retail for a bottle of wine, but most people don’t know what wine costs. It’s easy to scoff at a $40 chicken entree; much more nuanced to scoff at a $57 bottle of Sauvignon Blanc.

[Ericandblueboy]

Quote

 

Fair Wage Fee: A 20% fair wage fee is added to all checks to pay base hourly wages and offer benefits to our front and back of house staff. This fee is not a tip. Tips are welcome but OPTIONAL.

All tips are paid only to servers.

 

On Cane's website.  I'm okay with this since they spell out tips are optional.  In essence, the 20% fee is in lieu of tipping.