The Central Consumer Protection Authority abolishes service charge on food, tricity restaurateurs voice their opinion

Sheetal

The Central Consumer Protection Authority has announced that no restaurant and hotel can levy service charge in food bills to customers. “They have to clearly inform the consumer that service charge is voluntary, optional and at the consumer’s discretion,” clarifies the CCPA guidelines.

The authority even allows the customers to lodge a complaint on the National Consumer Helpline (NCH) in case of violation of this rule.

We talk to people from the hospitality industry, food bloggers and non-management staff in tricity to know how it affects them.

In Chandigarh, however, service charge ceased to exist in 2014. Vijay Kumar, manager, Dhaba 7, says, “Before 2014, we used to levy 10 per cent service charge. It used to be a good thing for the service staff.” Debdip Chatterjee, general manager, Hops N Grains, also confirms that they have not been levying service charge since last five years. But major restaurant and hotels in India (including Punjab and Haryana) levied around 10 per cent service charge until Monday.

The owner Hotel Aroma and chairman, Hotel and Restaurant Association of Chandigarh, Manmohan Kohli says, “The service charge used to be levied earlier. At the moment it is not prevalent at all. Very rarely, may be some hotels do it but by and large there’s no service charge in the industry. To say that restaurant owners will resort to hiking the prices of food items isn’t true. Prices are structured keeping everything in mind. It’s a very competitive market right now and you cannot have a whimsical attitude that you may charge whatever you want to. Overall, service charge is an old issue which is no longer at play.”

Tricity food blogger Isha Bhatia feels it’s the right move taken by the government. She says, “It should be the customer’s choice to pay service tax or not. It shouldn’t be imposed. We would always give tip to the man/woman who gives us good service and we should all appreciate their work. But to impose something on customer is not right at all.”

Amritsar-born food blogger Abhishek Sharma is currently Demi chef de partie at Jaypee Palace Agra. He says, “Service persons are definitely upset because there was an amount they used to get apart from their salary according to their sale performance. Our hotel restaurant shared 70 per cent of service charge with the staff and the rest 30 per cent in staff welfare schemes, like celebrating special days.”

Abhishek feels service charge should be made compulsory because their salaries are not enough. “They work long hours even on national holidays and festivals as well. Also, removing incentives from their salary will have an affect on their performance,” he adds.

Anhad Singh Nain, owner Plefora, New Chandigarh feels it is a bad move for service staff. “Service charge was discretionary anyway. It was up to the customer to pay it or not. It worked as a big motivation for the staff for it was an extra income along with tips. Now that service charge is removed, the only extra income the serving staff could get is tips which is not very popular here. Only about 10 out of 100 customers give a tip here,” he says.

Most customers outside Chandigarh who were paying the service charge up until Monday, say they refrained from tipping the waiters as they felt service charge covered a job-well-done by the serving staff. But, the hospitality industry insiders share how every company has its own policy on service charge as to what percentage of it will go into service staff’s account. Which again points out that making service charge discretionary in the food bill for the customers is a step in the right direction to enforce transparency in the consumer rights.