People willing to pay service charge if tip goes to staff: Survey

The government ruled that it was an unfair trade practice under the consumer protection law and declared that it was for the customers to decide if they wanted to pay the charge

Two in three people want restaurants to ask customers if they want to pay the service charge, according to an online survey by a citizen engagement platform.

People enjoy their food at a restaurant in Mumbai. (HT Photo)

LocalCircles, the online platform that carried out the survey, said most people were willing to pay the service charge if they liked the service but they wanted the money to go to the staff, not to the management.

Many hotels and restaurants add a 5% to 20% service charge to bills of their customers, prompting complaints that this ended up forcing customers to tip irrespective of the kind of service provided to them.

Last week, the government ruled that it was an unfair trade practice under the consumer protection law and declared that it was for the customers to decide if they wanted to pay the charge.

Nearly 60% felt that the service charge should be renamed as service tip so that there was no confusion that this was an optional charge.

Nearly 70% respondents said restaurant bills should have check box for service charge. The final amount charged to the consumer should be based on their selection, LocalCircles said in a statement.

As many as 5,000 consumers participated in the survey.

The statement said about 42% believed the service charge is pocketed by the management and 26% felt that some part of it is shared with the staff.

Only 5% of consumers believe it is shared fully with the staff.