Turning the tables on service charges

PUBLISHED : Thursday, 20 October, 2011, 12:00am
UPDATED : Thursday, 20 October, 2011, 12:00am


Johnny Tang is 22, has bleached blond hair, piercings and tattoos halfway up his arm. He might look like an unconventional waiter, but Tang's attitude is what really sets him apart. It's easy to see he's happy in his job and also very good at it.

Tang works at Yardbird, the trendy yakitori place in Central where a sign tells customers there's no service charge. Instead, patrons are asked to consider the service they receive and leave what they think is an acceptable tip.

Yardbird positions itself as a New York-style casual restaurant, a local establishment that focuses more on working hard to build up and retain a loyal clientele than turning over a succession of new covers nightly.

Its move to let customers decide what they think its service is worth is risky. Hong Kong has no official or government policy in place regarding tips, but most restaurants employ a 10 per cent service charge. 'I call that a profit charge,' says Matt Abergel, the chef/owner of Yardbird.

Despite Hong Kong's reputation as a service centre, there's ample evidence to suggest its service leaves a lot to be desired. This is partly because patrons of Chinese restaurants traditionally venture out for the quality of the food rather than the service, says a report by Polytechnic University's School of Hotel and Tourism Management.

Now the tide may be turning. As food culture and disposable income have grown, more people travel overseas and experience different service levels, or dine at pricier places where good service should be a given.

So why does that 10 per cent sweetener so often fail to deliver good service?

'Service in general is not great in Hong Kong, probably because there is little incentive for servers to go the extra mile when they will receive 10 per cent no matter what,' says Alicia Hamilton, an expatriate from New York, where the usual tip is at least 20 per cent of the bill.

Polytechnic University's study found many restaurant-goers were of the same opinion. The 611 patrons in the poll who visited Chinese restaurants tipped just 2.1 per cent extra when a service charge was in place. Most of them believed 10 per cent was a sufficient reward.

'Most customers believe the 10 per cent [service charge] goes to the employee, and that is wrong,' says associate professor Vincent Heung, the paper's co-author.

'Most times a restaurant manager will take that 10 per cent and give it to the owner or management. Some will distribute it among service staff, but others see it as income,' Heung says.

Noel Smyth, managing director of Delaney's in Wan Chai and Tsim Sha Tsui, and The Dublin Jack in Central, agrees. 'There is lots of confusion and manipulation of the service charge in Hong Kong.'

His company has had a tips-only policy since it opened in 1994, and Smyth estimates that waiters on contracts at outlets similar to his are on a monthly wage of around HK$8,000. He says that on a good month, his staff double that.

Not passing on the 10 per cent could mean a big pay difference for wait staff, but Smyth says the practice is common. 'Lots of places don't give the tips to wait staff, it goes towards food costs or company insurance policies, or whatever else.'

If the menu states a service charge, patrons have no choice but to pay it. This is why Matt Abergel terms the charge one of profit. His partner, Lindsay Jang, a former waitress and service trainer with upscale Nobu in New York, was the force behind the tips-only model at Yardbird, although she admits it's taken some effort to convince patrons. At the start, she and her general manager would deliver the bill to customers in person and drop a subtle reminder.

'Some perceive it as 10 per cent off,' she says. 'Usually, if your cheque comes to HK$2,000, you expect HK$2,200. When customers don't see that, they see it as some kind of deal.'

Jang's servers receive extensive training, with enough written information and guidelines to fill a hefty textbook, and she says it's frustrating to watch them work hard only to see them lose out. But are they losing out?

Johnny Tang and fellow waiter Abu Sibi smile broadly when talk turns to wages. 'People are really coming around. They are starting to understand,' Sibi says.

Their base salary is lower than a standard monthly wage (Jang estimates this to be HK$11,000 to HK$12,000 a month around SoHo), but they make on average 66 per cent to 100 per cent of that wage on top from tips.

Tang, who has worked in other restaurants, says working conditions are incomparable. 'It's way better. I was teaching English before this and it's way better than even that.'

Local businessman Gilbert Wong has developed his own system. Wong, who eats lunch out almost every day and dinner at mid-range places two to three times a week, says: 'For restaurants I visit regularly, I usually find out if the staff get the tips. If not, I take all the change I would have given and give them a big red packet at Lunar New Year.'