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The Aruban Service Charge

Philadelphia, PA
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8 posts
6 reviews
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The Aruban Service Charge

First, I will say that I have visited Aruba 5 times at this point. I love it. And I love the people. And I love the fact that this is a tourist destination and that the locals are such nice people and that they are good at what they do. They take pretty good care of us tourists and Aruba fully deserves to be the successful tourist destination it has become and remained over the years.

I also have to give kudos to the business community for doing a good job. This would not be the successful destination without them. HOWEVER, it is with the business community with which I have a complaint.

This "service charge". Ugh.

Let me say that I fully understand that an international tourist destination, such as Aruba, that services different cultures (some that tip and some that don't) has to make a decision as to whether to impose a service charge or not. The staff has bills to pay and obligations to meet. The restaurant cannot ensure a stable work environment unless it ensures a stable income environment.

A restaurant must make a choice as to how it will cover the cost of service:

A) The restaurant can directly pass the cost of service on to the customer in the form of a fixed service charge. Here, the establishment forces the customer to pay this fixed percentage of the bill regardless of whether the customer receives acceptable service or not.

B) The restaurant can pass the cost of service onto the customer INdirectly by increasing their workers salary and increasing their prices. Its a simple solution. Here the workers are not dependent on tips and it neutralizes the difficulty posed when servicing both cultures that tip and cultures that don't.

C) In the US, the restaurant covers the cost of overhead for everything, except the wait staff, in the check charges. The cost for delivering the final product (the food and drink) and ensuring good service to the customer is passed to the customer in the form of a tip. If the wait staff does a good job, you as a paying customer have the power and control to reward the waitstaff for that good service with a good tip. If the wait staff is rude, unpleasant, inattentive, it will be nobodies fault but their own if they do not make a good tip. Yes, occasionally, you may get the unappeasable customer that does not tip regardless of how good the service is, but this is the exception. Most people will tip appropriately and will reward good waitstaff with stable good income. I would say that the American custom is straightforward, easy to understand and effective.

Any of these options are perfectly fine. What is NOT fine is when the establishment chooses option (a) but then tries to be deceptive in an effort to hide, or not be upfront about, the fact that they included a service charge on their bill. That is what happened to me the other day at Gillian's.

And it was this experience at Gillian's that prompts me to spend so much time on such a long post. This was never intended to be such a long post, but the further I got into explaining things the more I wanted to address the responses or comments that people would inevitably have. I'm doing nothing here other than trying explain this service charge nonsense and try to protect newbies from getting screwed over by it.

Simply stated, if the establishment, imposes a 15% service charge and you want to leave a 20% tip, calculate the 20% based on the food charges, deduct the service charge and add the difference on the tip line.

However, it is not always so simple and some establishments are very sneaky. If you're interested to hear about the sneaky people at Gianni's read on.

My family of four went to Gianni's last night for dinner. We ordered 4 plates of fettucine alfredo . After we finished up, i asked for the check. the waitstaff brought the itemized bill that had a little line on it called "SC". It didn't say 15% service charge, just "SC". Despite the abundance of room they had to print "service charge" they chose to abbreviate this little ditty to SC. thankfully, I am not a newbie to Aruba so I knew what this was. I approve the itemized bill, give the server my credit card. He returns without the itemized bill and hands me only a signature copy that shows the total bill (no reference to any service charge that has been imposed), another line with "TIP", and then the total and a signature line. This bill was thoughtful enough to provide a little "TIP GUIDE" at the bottom where it said 15%=23.11 20%=30.82 25%=38.53.

Basically, the restaurant was suggesting I tip an additional 23.11 to 38.53 on top of the 19.80 service charge that had already been imposed on my $132 bill. So apparently Gianni's thinks a total of anywhere from 42.91 to 58.33 is appropriate on a $132.00 bill! That would work out to a tip/service charge equal to 32.5% to 44% of my bill. Is this deceptive? WHAT?

What's worse, we were already paying a hefty price of 18.50 each for four simple plates of fettuccini Alfredo. We did not even order something like chicken parmigiana. $18.50 for a small plate of pasta. There also charged an additional $2.50 for any refills of coke. My son said he would never have ordered a coke had he known it would cost $5.00 for two fills. But I digress...

First, let's get this terminology right. Your so called service charge is either a TIP; or a sneaky attempt to get me to pay your chefs salary. Sorry, but you need to cover your chefs salary in the $18.50 bowl of pasta. Stop calling this nonsense a service charge in a deceptive way in order to get me to separate it from the tip. And If you are charging a service charge, don't try to hide it either.

I run a business. In my business, I have overhead too. Payroll, cost of goods, rent, electric, phones, insurance, etc etc etc... Your payroll and whatever other overhead you have should be included in the cost of your product. It's ludicrous to try to pass on your cleaning services or your cooks salary to me in a hidden service charge. If you want to sell me a plate of pasta for $6.00 then fine, but don't try to sell me a plate of pasta for $18.00 then tell me the service charge you are imposing is not a tip to the server and that I should tip them separately. Nonsense! And worse yet, don't be sneaky about it the way that Gianni's is.

This post is more about me venting abut a shady business that any expectations that it will be read. but if you did choose to read this long post, please remember many people are showing up in Aruba for the very first time and many of them are getting duped into double tipping. While I think I understand the underlying reasons why a lot of Aruba restaurants impose service charges, I think the lack of uniformity and the occasional deception by "some" restaurants is at the root of the problem of people having so much trouble understanding how to deal with this "service charge". Aruba, either have a service charge at every establishment or don't. Be clear about it, be upfront about it and what it is and stop leaving things up to our imaginations.

Minneapolis...
Destination Expert
for Aruba, Palm - Eagle Beach
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15,180 posts
86 reviews
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1. Re: The Aruban Service Charge

I've heard similar stories over the years regarding both Gianni's and the Pelican's Nest (on Pelican Pier.) Have heard it enough times that I won't give either place my business.

Astoria, New York
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24 reviews
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2. Re: The Aruban Service Charge

This has been an ongoing thing on many different Aruba forums. Of course being sneaky is unacceptable, but most that impose a service charge clearly state is on their menu as well as the restaurants that do not impose a service charge. For those who do not wish to pay the service charge, there are many options to dine at in Aruba that do not include it on their bill.

It doesn't bother me either way, if I like the place I will go there whether they have the service charge or not (as long as they are not sneaky, not the first time I've heard it about Gianni's) and we throw a FEW extra bucks in with our payment...for example, if the bill is $105 including service charge, we will give them $115. If no service charge is included, we tip our usual 20% as we do at home.

Here is the list of restaurants that do not impose a service charge (copied from another forum)...

Amadeus Restaurant

B55

Barney's

Bavaria German Restaurant

Bingo! Cafe & Restaurant

Cafe Rembrandt

Carambola

Casa Tua

Chef's Table

Dutch Pancake House

Ellioti's Ristorante Italiano

Fishes & More

Flying fishbone

Gasparito

Gostoso

Kitchen, The

LG Smith Steakhouse

Linda's Pancakes & Pizzas

Madame Janettes

Mulligan's Golf Cafe Bar Restaurant

Old Cunucu House

Pizza Bobs

Promenade

Queen's, The

Sawasdee Thai

Smokey Joe's Island Grill

Sole Mare

Sutlan, The

Taste of Belgium

Wacky Wahoo

Yemanja

Zeerover

Someone had started to make a list with restaurants with no service charge.

Edited: 12 April 2013, 18:17
North Cape May, Nj
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8,821 posts
12 reviews
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3. Re: The Aruban Service Charge

Service charges can fool the inexperienced traveler. My first trips abroad were to the Bahamas. I was tipping 20% and more. Never realized that my bill already had a 15% service charge. I seldom, to this day, scrutinize my bill unless something doesn't seem right; however, I am always aware if a service charge is included. Even at home, it is common for a restaurant to add a service charge for partys exceeding a certain number. When paying by credit card, I never add an additional tip. If warranted, I leave an additional cash gratuity. Getting back to the Bahamas, I was treated extremely well. Finally caught on and adjusted my tipping. If I suspected a restaurant of being shady, I simply would not go there.

Massachusetts
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2,668 posts
62 reviews
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4. Re: The Aruban Service Charge

If I choose to dine at a restaurant on the island that imposes a service charge, I treat this as a tip. If a 15% service charge is applied, I will leave an additional 5% for good service. It is not a practice I necessarily agree with (as I believe the customer should determine what percentage of tip is appropriate), but if it is a restaurant I enjoy, I will...how shall we say...grin and bear it.

Thankfully, the vast majority of restaurants on the island do not impose a service charge, and as Trizi mentioned, those who do, for the most part, will note this on their menu.

The Netherlands
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338 posts
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5. Re: The Aruban Service Charge

Aruba is part of the kingdom of the Netherlands. Aruba is definitely not USA, it comes from a complete different background, so does the culture. In the Netherlands servicecharge is included in the bill. That is the reason in the Netherlands we don't tip an extra 20% like the people in the USA do. When Dutch people travel to the USA, they have to adjust their customs and realise they have to tip extra because that is what is expected in the USA. When they travel to Aruba they expect the servicecharge is included, because that is what happens at home too.

The confusion is that American people traveling to the Netherlands don't expect the servicecharge is included and think they have to tip the same way as they do at home. But if they would adjust their customs too, travelling abroad, things would not get complicated. I know that many USA tourists do tip a lot when visiting the Netherlands, or the rest of Europe, because they don't realise the rest of the world doesn't necessarily has the same rules as in the USA.

Because Aruba is visited by so many tourists from the USA it is very Americanized. Nothing wrong with that but things get a bit confusing sometimes, it is neither 100% left (european) nor 100% right (american), but more in the middle. Part of this middle is the tippingculture. I can't blame the restaurants for charging servicecharge, but I definitely blame them when they are trying to hide that for innocent USA tourists who are not used to travel abroad or used to different cultures. When the first Americans came to the island, the Arubans must have been completely puzzled why they did get so much tipping money from all those Americans, but I understand they didn't complain. Who would complain about free unexpected money :) Of course they learned fast and are much more used to this free money and have changed to expect it. I wished the Americans wouldn't have imported their tippingculture to Aruba, but that is the way it is.

When visiting Aruba I always read the bill, see what is done with the servicecharge and tip the way I think is appropriate. By the way, in the Netherlands, I pay 52% tax on my income which goes to the Dutch government and therefore to Aruba too. I absolutely do my part of social sharing with the Arubans;)

Connecticut
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1,320 posts
209 reviews
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6. Re: The Aruban Service Charge

Whenever we see the Service Charge added, we just add a small cash gratuity for the server.

Lynn, Massachusetts
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1,828 posts
62 reviews
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7. Re: The Aruban Service Charge

A very educational thread...we are heading to Europe in 3 weeks and on our last trip ( Greece) I felt I was cheating our servers on tips but my cousins said I was grossly overtipping....one server actually gave money back...in Aruba I'm aware of the sc and tip accordingly ..I don't mind as long as I know about it.....reading the list above I see most of the places we hit on it...

Philadelphia, PA
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8 posts
6 reviews
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8. Re: The Aruban Service Charge

@boesboes... I clearly never implied that Aruba was part of the USA or that Americans shouldn't adjust to local customs when visiting here. My post was long but I started out the post by clearly addressing that and went out of my way to do so.

So, this post was not made by someone expecting one culture to bend toward their own.

This post is about some deceptive businesses trying to take advantage of people. Plain and simple... People, be careful, because while by and large most businesses are honest, some prominent businesses such as Gianni's will dupe you into double tipping if you are not careful.

The Netherlands
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338 posts
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9. Re: The Aruban Service Charge

@RollingOut: by all means I absolutely didn't think you were saying that, because I haven't red that at all. I don't understand why you think that, but accept my apologies when I offended you, or anyone. Absolutely not my intention. Actually I totally agreed with you that restaurants who are not clear about servicecharges are to blame. We have been to Aruba 8 times staying at the Radisson, have seen Gianni build there at the other side of the street but never visited it, and will not now I know how they work.

Philadelphia, PA
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8 posts
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10. Re: The Aruban Service Charge

I would recommend tipping this way...

When you receive the itemized bill, scan the bill to make sure it is correct as you normally would, and then check it to see if there is a service charge included. Be aware that it will not always say something clear like "15% service charge". In the case of Gianni's it simply said "SC" and then a dollar amount.

After you approve the bill, give the server your credit card and ask them to bring the itemized bill back with the payment copy. Most servers that work for businesses that do impose service charges will not bring the itemized bill back if you don't ask them to. When the server brings back the payment copy, find the Pre-Service Charge SUBTOTAL on the itemized list (the amount BEFORE they added the service charge) and calculate whatever "TOTAL TIP AMOUNT" you want to leave based on that "pre-service charge SUBTOTAL".

Once you determine your desired "TOTAL TIP AMOUNT", go back to the itemized bill and locate the amount of "SERVICE CHARGE" which has already been imposed and subtract it from your "TOTAL TIP AMOUNT", then add the difference on the "TIP" line.

Example:

ITEMIZED BILL SUBTOTAL: $150.00

15% SERVICE CHARGE: $22.50

ITEMIZED BILL TOTAL: $172.50

PAYMENT COPY:

TOTAL: $172.50

TIP: $7.50 (Based on 20%) $150 x 20%= ($30.00)tip minus ($22.50)service charge= ($7.50)balance

TOTAL CHARGE: $180.00

So, leaving $7.50 on the tip line will leave the establishment with a 20% tip.

In the unfortunate event you receive poor service, your only recourse will be to ask to talk to the manager and have the 15% service charge removed from your bill.

Have a great time and enjoy this fantastic beach destination.