Service charge on dining - voluntary, really?

Going to restaurants once or twice a month is common for people to enjoy and explore different types of food along with family and friends. Some dine out much more.

 So far so good – the problems start hereafter.

 After eating, consumers (if not too drunk) tend to check the bill to confirm if it is properly charged – they find cover charges (at times), food, drinks, GST (broken into Central and State) and service charges.

They do find the last head, service charges separately and many of consumers have the notion that they have to make mandatory payment of service fees, so they pay service charges without asking restaurants about these.

This is not what it used to be few years back. You would leave a miserly or handsome tip for the servers commensurate with your dining experience, mood and otherwise. If you weren’t happy, you wouldn’t leave any tip – simple.

The practice of charging service fees has become quite prevalent in dining industry.

In reality, as per guidelines no consumer is required to make the mandatory payment of service charges as it is optional for consumer to pay or not to pay service charges.

Don’t you think that food and beverages already include service component as well? Every restaurant worth its salt justifies its pricing by including the service component and amenities. Else, they should be selling packaged food and drinks at MRP, which they don’t.

However, restaurants are collecting service charges without informing about optional payment aspect to the consumers. Whether this amount is divided among the people for whose benefit it is claimed, is something each of us can only guess about.

To me, do cover service component and imposing mandatory service charge is nothing but extorting consumers.

Summons were issued to National Restaurant Association of India by government for a dialogue on the continued practice of collecting mandatory service charge.

 Forcing consumers to pay service charges is quite an unfair trade practice under provisions of consumer protection laws and restaurants also have a habit of harassing consumers who request for removal of service charges from bill based on existing guidelines.

On other hand, certain section of restaurant owners segment say they do inform consumers about service charge payment is optional and their contention is that entire service charge will go to workforce. Further restaurant owners segment’ justification is that service charge will serve like an employee benefit scheme.

The prime agenda of the meeting was focussed on following issues:

 ·      Practice of compulsory payment of service charges

·      Non-disclosure to consumers about optional payment of service charges

·      Harassing consumers to make compulsory payment of service charge

·      Inclusion of service charges under disguise as a different fee or charge

Hopefully, there would be some changes in existing practice of collecting mandatory service charges and restaurants at least letting the consumers know about optional payment of service charge.

If diners intend to pay they will pay service charge happily to work force or if they are not satisfied with services then they should have right to not make payment of service charges.

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