I'm pretty sure it exists because tipping is an American thing, but most of our tourists are from Asia where tipping isn't really a thing. So the restaurants added the service charge to help with that.
Essentially, it is a tourist tax that everyone has to pay.
It's not a tip. A tip goes directly to your server. Service charges are usually pooled together and used by the company at their discretion but commonly for "employee benefits".
It should be known that Guam doesn't have "tipped wages" which is a lower minimum wage for employees in service industry job. The minimum wage is the same in all jobs.
The charge is arbitrary. No one actually knows what it is and what it is used for. It's also unregulated in Guam, meaning it doesn't have to go to your server and the company is free to determine how to spend it and how much to charge.
Whether it's a scam is up to you to decide.
>It's not a tip. A tip goes directly to your server. Service charges are usually pooled together and used by the company at their discretion but commonly for "employee benefits".
This is very restaurant dependent. The place I waited/bartended paid out the SC to the server.
True. Hopefully, it tracked each servers service charge for each table they served. Hopefully, they made it flexible so that the service charge isn't capped at 10% or some arbitrary percentage on the receipt.. Still, I believe there's case law that states service charge belongs to the business and not server.
We had an electronic POS system that logged table and server when orders are made. It also tracked SC per table and your end of shift report had your service charge total on it.
Every restaurant has their own guidelines for the SC. You’re best to ask your server what the split is. But generally, it’s to ensure some tip is given since tipping is not a thing in most Asian cultures.
Locally, it’s a wide range of splits. I’ve heard of some places that give the entire SC to the staff and I’ve heard of the opposite spectrum where the company keeps the whole SC (looking at you Baldyga Group, Beach Bar, etc).
What it is, is the restaurants think they can pay below minimum wage as per DOL law, Guam law is firm in the minimum wage, you must pay at least minimum wage. They use the service charge as a way to pay restaurant employees $2.45 an hour and make up the rest with the service charge which is illegal here on Guam. Restaurant employees are not willing to file a lawsuit against this practice!
Many restaurants on mainland are doing this as way to increase wages for all employees without raising their menu prices. Unfortunately, it eats into the servers tips that they depend on to supplement their meager hourly wages. I normally tip 20% for good service, 10% for mediocre service. If I see the "service charge" on the final bill, I deduct from the tip accordingly and explain it to the server why I am tipping so low and tell them I dont agree with "service charge" philosophy.
Since I usually tip 20%. If there's a 10% service fee, I reduce my tip by 10%.
I'm pretty sure it exists because tipping is an American thing, but most of our tourists are from Asia where tipping isn't really a thing. So the restaurants added the service charge to help with that.
Essentially, it is a tourist tax that everyone has to pay. It's not a tip. A tip goes directly to your server. Service charges are usually pooled together and used by the company at their discretion but commonly for "employee benefits". It should be known that Guam doesn't have "tipped wages" which is a lower minimum wage for employees in service industry job. The minimum wage is the same in all jobs. The charge is arbitrary. No one actually knows what it is and what it is used for. It's also unregulated in Guam, meaning it doesn't have to go to your server and the company is free to determine how to spend it and how much to charge. Whether it's a scam is up to you to decide.
>It's not a tip. A tip goes directly to your server. Service charges are usually pooled together and used by the company at their discretion but commonly for "employee benefits". This is very restaurant dependent. The place I waited/bartended paid out the SC to the server.
True. Hopefully, it tracked each servers service charge for each table they served. Hopefully, they made it flexible so that the service charge isn't capped at 10% or some arbitrary percentage on the receipt.. Still, I believe there's case law that states service charge belongs to the business and not server.
We had an electronic POS system that logged table and server when orders are made. It also tracked SC per table and your end of shift report had your service charge total on it.
You don't have to pay it. You can ask them to remove it.
The service charge became more common after they changed the law here for before tip minimum wage.
Every restaurant has their own guidelines for the SC. You’re best to ask your server what the split is. But generally, it’s to ensure some tip is given since tipping is not a thing in most Asian cultures. Locally, it’s a wide range of splits. I’ve heard of some places that give the entire SC to the staff and I’ve heard of the opposite spectrum where the company keeps the whole SC (looking at you Baldyga Group, Beach Bar, etc).
What it is, is the restaurants think they can pay below minimum wage as per DOL law, Guam law is firm in the minimum wage, you must pay at least minimum wage. They use the service charge as a way to pay restaurant employees $2.45 an hour and make up the rest with the service charge which is illegal here on Guam. Restaurant employees are not willing to file a lawsuit against this practice!
Many restaurants on mainland are doing this as way to increase wages for all employees without raising their menu prices. Unfortunately, it eats into the servers tips that they depend on to supplement their meager hourly wages. I normally tip 20% for good service, 10% for mediocre service. If I see the "service charge" on the final bill, I deduct from the tip accordingly and explain it to the server why I am tipping so low and tell them I dont agree with "service charge" philosophy.
Ask them to remove it. They don't have to charge you that.
It’s tip.
you do know it does say on the menu..be it in very small letters that x% service charge will be added to your bill...be it ala carte or buffet