When a service charge is purely gratuitous

by Janice Hough on January 20, 2012


Phillip Cushman had a little free time during a recent stay at the Buena Vista Palace Hotel & Spa near Disney World. Since the prices looked relatively reasonable, he decided to try a massage. But then, he read the fine print.

The note at the bottom of the price list — “20% Service Charge”! Now, that’s a bit steep, he thought. (Royal Caribbean Cruise Line, for example, charges 18%, and cruise lines aren’t known for their bargain spa prices.) On the other hand, the overall cost wasn’t bad. Plus, he decided having the service charge included would be simpler than figuring how much cash to tip.

Then he read further. The “Service Charge” did not include gratuity. The spa said that should be handled separately. At that point, he gave up and read a book.

The direct quote from the “For your convenience, a 20% service charge will automatically be added to each spa treatment and salon serice (sic) received. A tip or gratuity is not included and may be given to the therapist at your discretion.”

I understand that not all included service charges go directly to the provider, and that a hotel or cruise line spa may take a cut. Hotels that provide room service in fact are particularly likely to add a service fee and a delivery charge. Waiters have told me they don’t get the whole gratuity.

Curiously enough, the woman who gave me a facial on Royal Caribbean told me she got all the included tip. Though, I suppose she might have been being polite.

This case, however, seems particularly egregious. Maybe the service charge helped cover the cost of support staff, but even so, it’s the equivalent to my mind of the now ubiquitous fuel surcharge, which clearly just is now a non-discountable way of padding the bottom line.

If the 20% doesn’t go to the staff, why not just add it to the prices. (Now, I suppose it is possibly something to do with what the hotel pays in taxes, but that doesn’t make it any more honest?)

How many spa patrons simply see the 20% percent service charge, assume a tip is covered and leave nothing?

Unbundling has become big in the travel industry as a way to increase the final bill with surcharges for just about anything suppliers can imagine. When travelers are charged for the gym, Internet, checked baggage or indeed anything optional, at least they are receiving some service.

But mandatory service fees for no service aren’t for “your” convenience. They’re another money grab.

What do you think, Consumer Traveler readers? Do you have any other tales of greed to share? If so, please add them in comments.

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  • Pmauss

    This reminds me of the service charge added to a cruise.  These charges are somewhere between $10. and $15. per person per day including children.  Also some cruise lines are now “allowing” you to prepay these pesky charges to help you budget your expenses.

  • Phil

    As I indicated in my email to you earlier, the service charge that doesn’t include the gratuity was a deal breaker for me.  Sometimes it is not a matter of whether you can afford a particular service or not but “the principle of the thing.” I simply could not participate in any Spa activity after reading the fine print that spelled out the hotel’s policy of dishonesty.

  • Len

    Those charges are in place of individual tips. It is easier to pay these along with your other extras on your final bill. Perhaps you just do not want to tip at all.

  • Len

    Those charges are in place of individual tips. It is easier to pay these along with your other extras on your final bill. Perhaps you just do not want to tip at all.

  • Len

    Those charges are in place of individual tips. It is easier to pay these along with your other extras on your final bill. Perhaps you just do not want to tip at all.

  • Len

    Those charges are in place of individual tips. It is easier to pay these along with your other extras on your final bill. Perhaps you just do not want to tip at all.

  • Anonymous

    This reminds me of certain China tours and hotels which tell customers a tip is required and-or a service charges of X% will be added to the bill.

    Any native of mainland China will tell you that tipping is absolutely unheard of.  Only gullible foreigners fall for this ploy of the tourism industry.  Further, the only defenders of this practice are those in the industry themselves or relatives thereof.

    Service charges and tips in mainland China are simply culturally unacceptable to the natives, except if you are on the receiving end.

  • Tankin

    My rule of thumb is that any time I have to pay for service (Delivery Fee / Mandatory Service Fee etc) … I don’t tip. In this case the massage therapist would have been ticked but I already paid for her service.

  • MVFlyer

    So this makes me wonder–what is the service charge actually for?  And is it really for *my* convenience????

  • Phil

    Anytime I see the phrase “For your convenience” I know that I need to get ready because they are going to stick me with something that is going to cost me plenty and is not in the least for my convenience.  It is a term that I have grown to despise and one would think businesses would pick up on that fact and stop using the phrase.  They apparently believe we are even more stupid than we are.

  • Anonymous

    It’s just fraudulent advertising. Take your business elsewhere. If there’s a fee, they’d better provide some extra value for it, or it’s just a way to lie about the price.

  • Anonymous

    I agree, this sounds like a money grab. If a service provider is going to whack you with a service charge, it should be in lieu of a separate gratuity.  This doesn’t sound any better than the purely evil mandatory “resort fees” that too many hotels charge these days to give the appearance of an artificially low base rate.  If you can’t avoid paying a charge, it should be rolled in to the base price.

    I have a problem with automatically service charges to begin with, mainly because 1) it locks you in to a fixed percentage tip regardless of the level of service received, 2) it disincentives the waiter, masseuse, etc. from actually providing good service, since they’re getting their money no matter what, and 3) it can be like pulling teeth to get a service charge removed or reduced if you receive poor service.  And, it bothers me to no end that you credit card receipt still contains a line for a tip, even when the bill includes an automatic service charge.  But, at least, there’s a rational basis for the charge – it is in lieu of the gratuity.

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