Restaurants forcing us to pay service charge, allege Patrons

Rujuta Parekh
Monday, 24 July 2017

The guidelines state that the bill must clearly display that service charge is voluntary and the column may be left blank for the customer to fill up before making payment.

Pune: Restaurants imposing mandatory service charges on customers has become a major issue for Punekars, who have to shell out anywhere between five to 10 per cent extra on their bills. Nearly 80 per cent of the Punekars feel that the restaurants are forcefully extracting service charges from them and that this is a wrong practice. 

In a poll conducted by Sakal Times online, over 80 per cent respondents agreed that restaurants are forcefully imposing service charges on them even though the Union government has given guidelines that paying service charges is at the discretion of the customer. Customers are feeling cheated as they are forced to pay five to 10 per cent extra on their bill amount, which is inclusive of Goods and Services Tax (GST). 

Instances have come up where restaurants have put up billboards or the staff verbally informs customers that they levy service charge. “The way the restaurant staff informs us sometimes indirectly means that one is free to leave if he is not willing to pay service charge. It feels insulting and makes one not want to pay service charge. If I like the service, I will leave a hefty tip but I must not be forced to pay it,” said Shivam Singh, a professional.  

Numerous such instances have come to light since the implementation of GST on July 1.  Several have turned to the social media to voice their grievances and to discuss whether it is fair for restaurants to force people to pay these charges. A city resident said, “Restaurants say that this service charge is collected and then evenly distributed among the staffers and thus they seek cooperation of customers. I want to ask these restaurants, do you not pay your staffers? When the government has stated that it is up to the customer whether to pay a service charge, why do you have to force customers to pay additional amounts for the ‘welfare’ of their staff?”

According to guidelines provided by the Union Ministry for Food and Consumer Affairs, “The point of time when a customer decides to give a tip is not when he/ she enters the hotel/ restaurant and also not when he/ she places the order. It is only after completing the meal that the customer is in a position to assess quality of service and decide whether or not to pay a tip and if so, how much. Therefore, if a hotel/ restaurant considers that entry of a customer to a hotel/ restaurant amounts to his/ her implied consent to pay a fixed amount of service charge, it is not correct. Further, any restriction of entry based on this amounts to a trade practice which imposes an unjustified cost on the customer by way of forcing him/her to pay service charge as condition precedent to placing order of food and as such it falls under restrictive trade practice as defined under section 2(1) (nnn) of the Act.”

The guidelines state that the bill must clearly display that service charge is voluntary and the column may be left blank for the customer to fill up before making payment. According to the guidelines, “A customer is entitled to exercise his/her rights as a consumer, to be heard and redressed under provisions of the Act in case of unfair/restrictive trade practice.”

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