To tip or not to tip
Not all restaurant owners support the automatic service charge that customers pay. Susan Jung explains what really happens to that extra cash we hand over with the bill
SOME FRIENDS from Hong Kong had lunch at the Grand Central Oyster Bar in New York, which is at the top end of the scale in a city filled with expensive restaurants.
After the couple left a US$5 (HK$39) tip, their waiter went to them as they were about to walk out the door. He asked if they had any complaints about the service, adding pointedly, 'because I was just wondering why you left so little'. My friends handed over another US$5.
The waiter's strong-arm tactics were perhaps a matter of economic necessity - the United States Internal Revenue Service taxes service staff on tips they're estimated to make - whether they receive them or not.
Compared to that way of extracting a tip, the propensity of most Hong Kong restaurateurs to add an automatic 10 per cent service charge seems mild. The charge appears on bills at almost all restaurants, from those in five-star hotels to street-side noodle shops.
In the US, though, if you give that perfect waiter a US$20 tip, you can rest assured he's going to get it.
In Hong Kong, the diner who pays the added-on service charge won't know precisely where the money is going. Customers who assume it's going to the waiter who served them frequently do not leave any additional cash.
Policy varies - some places divide the money between staff - often everyone, from runners and kitchen crew to managers, gets part of the money. Others keep the 10 per cent for 'staff benefits', such as uniforms, insurance and dry cleaning.
The food and beverage industry in Hong Kong is tough - workers are on their feet six days a week (most industries cap a maximum work week at 5.5 days). Monthly salaries for waiting staff in hotels are usually $9,000-$15,000 per month, while the industry average for independent restaurants is $9,000-$10,000.
A spokesman for a five-star hotel was clearly nervous about the service charge issue - he didn't want his name or hotel to be named. 'Cash or credit card tips left by guests always go to staff,' he stated. 'The staff self-regulate the tips and self-distribute it on a points system according to seniority and position.' Asked about the automatic 10 per cent service charge, he said, 'I don't want to get into that.'
Those behind independent restaurants are a little more forthcoming. Richard Feldman says that at his restaurants - Al's Diner, American Pie and Red Rock - customers pay an automatic service charge on food. He candidly admits that the 10 per cent does not go to the staff, 'It stays within the company. We treat it as gross income, it's part of our total revenue. But any tips on top of that, whether it's on credit card or cash, go to that member of staff. Bussers [runners] get a percentage of the waiters' tips. We set the rate, but they often give more.'
For years, Lan Kwai Fong restaurant, Post 97, gave its customers the option to tip. But when Group 97 underwent restructuring two years ago, the policy was changed to bring Post 97 in line with sister outlets, Q (now Cafe Einstein), Pavilion, El Pomposo and La Dolce Vita. Jamie Higgins, general manager of Group 97, says the automatic service charge for all the group's restaurants 'goes into operation costs - paying for dry cleaning, for daily upkeep, uniforms'. He added that any additional tip given by customers is kept by the waiter, who gives 10 per cent of his take to the bar and another 10 per cent to the kitchen.
'When we do our training, we stress that tips means To Insure Prompt Service,' Higgins says. 'If a customer gets terrible service, he won't tip.'
The Bayou on Shelley Street also started off without the automatic 10 per cent. 'We changed it after a year and a half,' says owner Lori Granito. 'In the States, waiters work for tips by improving service, it's a way of motivating them. Here, it actually did the opposite. In the beginning we were so incredibly busy and people were leaving great tips. The staff were like, 'well, you owe us', that kind of thing. They really made no effort, there was no correlation to them between the effort made and the amount of tips they were getting. We didn't see an improvement on performance, so we changed [to the automatic service charge].'
The staff at The Bayou are lucky: not only do they get all cash and credit card tips, but also a take of the service charge, which is divided among them through a bonus scheme. 'We have tests every fortnight, on things like product knowledge, drink knowledge, company policies,' says Granito. 'It's a way of keeping them up to speed. It's based on test and performance. In my experience, people need money for motivation. Waiting tables will always just be a job for some people. In order to get what we want, money works.'
Even though the restaurants run by Gotham City Concepts (Fat Angelo's, Buddy's Famous Seafood) are American-style, tipping is Hong Kong-style.
'We do it simply because everybody else does, it's come to be an institution,' Gotham managing partner Andy Chworowsky explains. 'Personally, I'd like to see it go, but it's difficult. If we didn't have the automatic 10 per cent, we'd have to put big notices on the check stating that, which is basically saying, 'please tip'. This is a matter of going with the flow.'
The 10 per cent service charge at the Gotham City restaurants gets to the staff in ways other than cash benefits. 'It goes to them through medical insurance and staff parties. I'm not saying it all goes to them, but a large portion does and it's a lot fairer than cash. All the staff get a piece of it, not just the front-of-house people.'
Chworowsky, who's been living in Hong Kong for 27 years, gives a plausible explanation on how the automatic service charge first started. 'There are so many different cultures in Hong Kong. Tipping is part of some cultures, but not of others. Someone way, way back just decided to standardise it.'
Policy on the automatic 10 per cent also varies from place to place in Chinese restaurants. William Mark Yiu-tong, president of the Federation of Hong Kong Restaurant Owners, and owner of City Chiu Chow, says: 'Different restaurants have different systems. Some places give a cut to the management, while the staff get a percentage. At other places, it all goes to the staff, the 10 per cent as well as cash tips. For my restaurant, it's take-home money, it's distributed to the staff regularly.'
He admits that the 10 per cent charge isn't always deserved. 'Sometimes I wonder why I should pay. At some restaurants, service is, how should I put it, non-existent, with indifferent waiters.'
Although the restaurateurs conform to the norm, they don't necessarily like it.
Feldman says: 'Tipping should be given when the service is great and not given when the service is not up to standard. In Hong Kong, it's not an option, you can't not pay. People should be given the option.'
Granito agrees. 'I prefer the US system, where you tip what the service is worth,' he says. 'The automatic 10 per cent is a double-edged sword. The staff might miss out on bigger tips because people who might normally give more don't want to tip on top of the 10 per cent.'
Chworowsky wishes people realised how difficult waiting tables is. 'It's not a master/servant relationship. I think every person in the world should spend at least three months working as a waiter, then they'd know how it feels.'