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Author: arrete Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 756811  
Subject: Automatic tipping going bye-bye Date: 9/5/2013 8:04 AM
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>> An updated tax rule is causing restaurants to rethink the practice of adding automatic tips to the tabs of large parties.

Starting in January, the Internal Revenue Service will begin classifying those automatic gratuities as service charges—which it treats as regular wages, subject to payroll tax withholding—instead of tips, which restaurants leave up to the employees to report as income.

The change would mean more paperwork and added costs for the restaurants—and a potential financial hit for waiters and waitresses who live on their tips but don't always report them fully.
.....
The change will complicate payroll accounting for restaurants that stick with automatic tips, because they will need to factor those tips into pay, meaning hourly pay rates—could vary day to day depending on how many large parties are served.

Restaurants are required to report to the IRS what its employees report receiving for tips and to pay Medicare and Social Security taxes on those amounts.
.....
Ms. Cordoba makes base wages of $4.25 an hour, or $144.50 to $161.50 for her average workweek of 34 to 38 hours. She said she usually makes an additional $500 to $650 a week in tips. Since she never knows exactly how much she will get each week in tips, getting paid at the end of each shift helps her budget, Ms. Cordoba said. "In this industry, that's what we live on. If I had to wait two weeks I don't know how I'd survive." <<
http://online.wsj.com/article/SB1000142412788732389300457905...

Why'd they start the automatic tipping for large parties? Since tipping is supposed to be discretionary.

arrete
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Author: 307wolverine Big funky green star, 20000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695625 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 8:35 AM
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Why'd they start the automatic tipping for large parties? Since tipping is supposed to be discretionary.

You've never seen the wording "an extra 15% (or whatever) is added for parties of 8 or more" on a menu?

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Author: lowstudent Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695628 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 8:47 AM
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Why'd they start the automatic tipping for large parties? Since tipping is supposed to be discretionary
_________________________________________________

Why?

Because on a 300 bill, 15% is 45 dollars.

Lots of people will feel they are being generous leaving 25 dollars, after all 25 is a nice chunk of change they will feel.

They do not consider their party took more time than a equal number of separate orders and that they cost the waitstaff money in many cases, particularly on a busy night when they stay longer and create less customers.

There are lots of reasons, but basically it is because large groups are not huge tippers in general and too many are lousy tippers who take up too much effort.

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Author: arrete Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695631 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 8:52 AM
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Why'd they start the automatic tipping for large parties? Since tipping is supposed to be discretionary.

You've never seen the wording "an extra 15% (or whatever) is added for parties of 8 or more" on a menu?
----------------------

Sure I've seen it. I was just wondering why restaurants started doing it.

arrete

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Author: 307wolverine Big funky green star, 20000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695633 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 8:53 AM
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Sure I've seen it. I was just wondering why restaurants started doing it

To ensure that the wait staff gets a tip.

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Author: JLC Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695677 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 2:18 PM
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Sure I've seen it. I was just wondering why restaurants started doing it

To ensure that the wait staff gets a tip.


What I've seen happen way too many times before the automatic gratuity, large party, everyone assumes that someone else is leaving a tip or everyone leaves a real small tip thinking that others are leaving bigger tips.

The few waiters I know hate large tables.

JLC

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Author: arrete Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695680 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 2:30 PM
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What I've seen happen way too many times before the automatic gratuity, large party, everyone assumes that someone else is leaving a tip or everyone leaves a real small tip thinking that others are leaving bigger tips.
---------------

I get it! The tragedy of the commons. Same thing.

arrete

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Author: JediGALT Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695715 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 7:40 PM
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Sure I've seen it. I was just wondering why restaurants started doing it.

arrete
***

Cause certain Democrat constituencies eat out.

Very rude and demanding on the waitstaff and skimpy on tips.

Google most waiter/waitress blogs and see who they talk about as the worst tippers and rudest customers.

JediG

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Author: ascenzm Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695755 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/5/2013 10:08 PM
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Cause certain Democrat constituencies eat out.

Very rude and demanding on the waitstaff and skimpy on tips.

Google most waiter/waitress blogs and see who they talk about as the worst tippers and rudest customers.

JediG


Those darn Amish.

Mike

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Author: CCinOC Big funky green star, 20000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695775 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/6/2013 2:44 AM
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880 comments on who's the worst tippers.

http://waiterrant.net/?p=1597

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Author: Jim2B Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695805 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/6/2013 9:25 AM
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Automatic tipping, isn't. It is an extra charge to large groups and it makes me really mad.

I am a good tipper, I tip 20-25% most of the time. However, when a restaurant charges an automatic tip, the wait staff only gets what that tip is. I also try to not return to the restaurant.

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Author: lowstudent Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695817 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/6/2013 10:01 AM
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I am a good tipper, I tip 20-25% most of the time. However, when a restaurant charges an automatic tip, the wait staff only gets what that tip is. I also try to not return to the restaurant.
________________________________________

Although I agree with you here in general, I do differ on large groups.

The gratuity for large groups is a required policy IMO. I might now be a problem when I am controlling the action, but I have seen too may injustices here and you are talking about taking a huge chunk of a waiter/waitresses day's income from one jerk

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Author: Jim2B Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695823 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/6/2013 10:27 AM
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The gratuity for large groups is a required policy IMO.

It cannot be called a gratuity if it is "a required policy."

The restaurant might as well state that "we don't like large groups, so we charge them 20% more than small groups."

Just like taxes suppress behaviors, so do restaurant mandatory tipping policies. So I take my business elsewhere.

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Author: lowstudent Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695824 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/6/2013 10:33 AM
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It cannot be called a gratuity if it is "a required policy."

_____________________________________

You are right, it should rightly be called a waitstaff service fee in lieu of gratuity. A difference without a distinction IMO, but I agree clearly more appropriate.

To be honest, I would very much prefer if the model were sane and waitstaff salary were not at the discretion of patrons -- something were say 10 percent of meal cost went to waitstaff and anything above that was an actual tip as opposed to essentially tips being salary

However, I do not hold the model against waitstaff.

I certainly understand not liking the model, and choosing other restaurants. I agree the restaurant has to make a choice between being fair to their staff and alienating people. That is a choice made all the time in many different ways by many businesses.

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Author: THEMATHISNEAR Big gold star, 5000 posts Top Recommended Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 695886 of 756811
Subject: Re: Automatic tipping going bye-bye Date: 9/6/2013 2:43 PM
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Cause certain Democrat constituencies eat out.

Very rude and demanding on the waitstaff and skimpy on tips.


That's if they're lucky. If they're unlucky, they'll get someone like Ted Kennedy, Bill Clinton, Anthony Wiener, John Edwards, etc., where they might get groped and sent unwanted Twitter messages.

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