Tipping etiquette and Jamaica.

[Rob]

Except that a service charge is added AFTER the meal, it is NOT part of the meal unless you consider gratuity part of the meal.

Huh? It IS part of the meal charge. It is not optional or at your discretion like the gratuity/tip. They are in no way the same thing. I suppose you could say it is added AFTER the meal, because it would be impossible to calculate a 10% charge for something that you havent ordered or eaten yet... But when the menu says 10% service charge, you simply add 10% to each item that you order on the menu.

It's no more dishonest than saying it's part of the meal, at this point I think we need to break down what the food price goes towards:

1. Rent
2. Food costs
3. Employee overhead
4. Utilities, bills, etc.

It is dishonest AND illegal to call it a tax. It is not charged by the government and it is not paid to the government. It is NOT a tax and cannot be called one. And all those costs do allow the restaurant to arrive at a cost for their food items. And the service charge is most certainly a part of the final meal cost. It is an accounting procedure that allows for employees to benefit when times are busy as a wage suppliment.

Why wouldn't it help the employees take home pay? Are you saying that the restaurants would withhold it and pocket the money? Why are we playing games of transparency when it comes to the cost of running a business?

Just because you dont understand something does not mean there is anyone playing any games. I will use a simple example to illustrate how it works. Lets use a restaurant with 10 employees. In slow season, when times are slow and no meals are sold, the employees get their hour wage and that is all. In busy season, when the restaurant sells jm$100,000 worth of food in a day, the employees each receive an additonal 10% of the 10% service charge, which would increase their daily take home pay by jm$1000 per day (10% of $10,000 service charge collected). For a business that does not have a service charge, the wages may or may not be slightly higher, but there is no guarantee as wages in tourism have to take into account slow season. But the service charge is one way to provide a bit more take home pay for employees who share in the benefit from that practice.

Can we call it what it is, a tourism tax? I don't necessarily see anything wrong with it, what I have issues with is the sugar coating that goes into it.

It cannot be called a tourism tax because it is NOT a tax. It is an accounting procedure that benefits the employees who share in that service charge.

I'm all for paying the employees fairly and especially when times are busy; but the meals should be transparent and the restaurant owners should be the ones to shell out and the prices should reflect it.

You keep using the buzz word "transparent". How is the service charge that is printed on the menu NOT transparent? It is not being hidden and is being called exactly what it is. It is a service charge, not a tax or gratuity -which it is not. And, are you not aware that as a paying customer that you are the one who is actually paying their wages? The owners dont print their own money and pay wages, they receive it from their paying customers and pay their employees wages accordingly.

So are we in agreement that the servers need to be honest and say that they do see a portion of it?

Why was the manager lying to the other person about what the service charge is for?

It's in their immediate interest to be honest with the customers instead of lying through their teeth.

One cannot explain what they do not understand. You are having problems understanding this concept and you are a business owner. As I have already mentioned, not all employees or even managers understand this perfectly. To demand an employee to understand this and be able to quickly explain it seems a bit unrealistic.

I understand that Jamaica is a small developing island and needs to import the majority of items. That said if it isn't sustainable then perhaps they need to reevaluate the business model, countries(the US included) need to try to not rely on imports to sustain the entire nation.

Have you taken any time at all to research the realities of Jamaica before making this statement? How can a small island, the size of Connecticut with minimal natural resources NOT rely on imports to feed 3 million plus people?

Fuel prices here are $4-5 a gallon, electricity is extremely expensive(Over $1,000 a month for each of my stores in utilities), rent is Ridiculous(up to $200 a square foot), regulations cost a lot to comply with, and shipping can kill our profit margin.

We also tend to have higher employee costs(I start my people at $10-$20 an hour), imported items are still prohibitively expensive, and we tend to have a LOT of taxes.

If you want to say that food prices in Jamaica are the same yet don't include labor(given that this is what the service charge is for) I have a hard time believing that the food costs reflect purely import costs(especially for the places using local seafood) alone.

All of what you described every US business deals with on a daily basis, yet we don't have service charges.

You really do need to research the cost associated to running a business in Jamaica. That is well beyond the scope of this tourism focused message board. But please remember that the service charge does not pay for the labor costs, but adds a bit of bonus when times are busy to that hourly wage that is already being covered by the menu item cost.

I will adjust my thinking when I'm actually in Jamaica, currently I AM in the USA. That doesn't mean I can't question why there is a service charge above and beyond the cost of the food+gratuity.
Transparency is key if you want to build good will, the service charge should be part of the food and if you want to keep gratuity go ahead(even though it doesn't foster better service).

To understand the service charge in Jamaica, you have to keep Jamaica in mind when doing so. Trying to understand it from a USA point of view while in the US will only lead to the confusion you seem to be experiencing with this accounting practice.

I would prefer that there be no service charges and allow the restaurants to compete on an even foot.

You can prefer that, but that doesnt change the fact that service charges exist. Business owners here in Jamaica dont seem to have any problem with competing with this accounting practice.

I'm of the opinion that a service charge does Jamaicans a disservice because when foreigners sit down they're not going to have this entire forum's worth of perspective, most people will see a service charge and assume(right or wrong) that it IS the gratuity, especially on meals that are more expensive.

This is why I am taking the time to explain this as clearly as possible. So that everyones understands that a service charge is not a tax or an optional gratuity/tip. It is part of the cost of the meal that is purchased.

When you Mandate a fee to pay the employees it isn't optional and it doesn't foster good will, it leaves a bad taste in a lot of people's mouths, especially when the managers don't even know how to explain the service charge!

The government is not mandating the service charge, so it is up to the business to choose to have one or not. You can choose to patronize the businesses or not - that is your right as a customer. I agree that managers should understand the concept, but in reality, not all do.