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Service charge on bill doesn't go to servers

Posted by: James Eli Shiffer under Buyer beware Updated: July 23, 2010 - 9:25 AM

Over the past year, hundreds of you have asked Whistleblower for help. While we can’t investigate each tip, we want to share more of what you tell us. In 2009, we started publishing a few tips each week to stimulate online discussion and create ways for our readers to help each other. Unlike our news stories, we have not verified this information. If you have a tip, send it to

Since tips and waitresses are on everyone's mind this campaign season, one Whistleblower reader thinks out-of-control surcharges and fees have reached the point of being deceptive:

We seem to live in a world in which add-on fees are used to disguise the true price of goods and services. Is this practice creeping into restaurants as a way of silently taking servers’ tips?

My girlfriend works at a metro country club as a waitress. The club adds a service charge to each tab (about 18 percent). Diners assume that is a fixed tip for their server so they don’t leave any. She receives a higher-than-minimum wage (about $10 per hour) and only nominal tips such as when there is a cash bar at a wedding.

The service charge doesn’t go to the servers. That's legal, as long as the establishment makes it clear to patrons on signs, menus or the bills, according to the Department of Labor and Industry. But is it right?


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