Service Charge Breakdown

[Moby0215]

Yes you do now. A couple of years ago you just canceled it at the end of your cruise at the service desk. NCL managed to put another speed bump into the process knowing many people wouldn't follow through and/or get confused on how to adjust the Discretionary Service Charge. Nickels and dimes matter to NCL.

 

 

 

This was not my experience on the Gem this past December. DSC refunded right on ship.

 

 

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[Quilting_Cruiser]

I really wanted to hear how those making the claim that the DSC was not equivalent to gratuities would explain this, but no one picked it up.

 

 

Yep, they just passed it by, didn't they? LOL. I've seen it on a few of the other thousands of tipping threads, and they usually say it's "marketing spin." But, the fact is that NCL does, indeed, refer to the DSC as gratuities.

 

The argument that it's anyone's business where a tip goes is another one that I don't understand. When I eat in a restaurant I don't grill the owner about where the tip goes that I left on the table. I know it's split between a number of people, but I don't know who gets what, and I don't care. I figure they have a system that works for them, so why should I care? But, the argument goes on...

[SeaShark]

I really wanted to hear how those making the claim that the DSC was not equivalent to gratuities would explain this, but no one picked it up.

 

Well, it isn't like you couldn't do your own research, but...

 

Basically, it is a legal definition. A tip is the earned property of the employee to whom it was left. A service charge belongs to the company and the company has discretion over how that service charge is (or isn't) distributed to employees.

 

 

The following is copied from another thread, but explains what differentiates a Tip or Gratuity from a Service Charge.

Service charges and tips/gratuities are NOT the same thing. (If they were the same, there would be no reason to differentiate between the two in the FAQ, right?).

 

 

What is a tip or gratuity?

 

These are the general characteristics of a tip/gratuity:

• The payment must be made free from compulsion.
  
  
• The customer must have the unrestricted right to determine the amount.
  
  
• The payment should not be the subject of negotiation or dictated by employer policy.
  
  
• Generally, the customer has the right to determine who receives the payment.
  
  

What is a Service Charge?

 

Service charges will usually be clearly indicated as such.

If any of the above listed traits for a tip are missing, however, then it is usually a service charge.

In other words, a service charge is, when:

• The payment is mandatory, or
  
  
• The customer does not possess the unrestricted right to determine the amount, or
  
  
• The payment is the subject of negotiation or dictated by employer policy, or
  
  
• Generally, the customer does not hold the right to determine who receives the payment.
  
  

In short, if ALL four characteristics are present, then it is a tip. If one or more are not present, then it is a service charge.

 

[Gampy1967]

Well, it isn't like you couldn't do your own research, but...

 

Basically, it is a legal definition. A tip is the earned property of the employee to whom it was left. A service charge belongs to the company and the company has discretion over how that service charge is (or isn't) distributed to employees.

 

 

The following is copied from another thread, but explains what differentiates a Tip or Gratuity from a Service Charge.

Service charges and tips/gratuities are NOT the same thing. (If they were the same, there would be no reason to differentiate between the two in the FAQ, right?).

 

 

What is a tip or gratuity?

 

These are the general characteristics of a tip/gratuity:

• The payment must be made free from compulsion.
  
  
• The customer must have the unrestricted right to determine the amount.
  
  
• The payment should not be the subject of negotiation or dictated by employer policy.
  
  
• Generally, the customer has the right to determine who receives the payment.
  
  

What is a Service Charge?

 

Service charges will usually be clearly indicated as such.

If any of the above listed traits for a tip are missing, however, then it is usually a service charge.

In other words, a service charge is, when:

• The payment is mandatory, or
  
  
• The customer does not possess the unrestricted right to determine the amount, or
  
  
• The payment is the subject of negotiation or dictated by employer policy, or
  
  
• Generally, the customer does not hold the right to determine who receives the payment.
  
  

In short, if ALL four characteristics are present, then it is a tip. If one or more are not present, then it is a service charge.

 

 

So even though NCL calls it a Service Charge it is really a tip (by the above definition), especially if the customer reverses the DSC on board:

 

 

1. The DSC is NOT required becasue you can get it reversed onboard.

2. The customer can then determine as they wish (determine the amount) how much they want to tip the various staff

3. The customer can then determine who gets what outside of any negotiation.

 

 

If someone simply leaves the DSC as it is, it becomes a service charge. If they reverse it and distribute as the wish, it is a tip/gratuity.

[chengkp75]

I was wondering if the cruise lines were signatory to the ILO standards and couldn't find anything so I really appreciate your chiming in here. The estimate you provide in another post that the base pay plus overtime at 125% equaling about $1,500 per month seems to be about right based on what I've seen on YouTube and read on sites like glassdoor.com. I was estimating just over $1,000 a month (equivalent to roughly $4,000 a month for a waiter or steward from the Philippines based on cost of living there).

 

Americans don't have this advantage because of our tax laws, but I guess UK workers do not pay income tax on income earned abroad, so the tax advantage can be significant too. One of the UK based YouTubers mentioned that she is able to save about $10,000 of her earnings each cruise tour by watching what she spends. We save each year, but we don't save $10,000, and our incomes are much higher.

 

It's not the cruise lines that are signatory to the MLC 2006, it is the flag states the ships operate under. Panama and the Bahamas are both signatories to the MLC 2006.

 

The way that young European or US crew can save significant amounts from crew pay is that they really are benefiting from the "free room and board" that many claim as a reason that crew wages are so low. These folks are living at home with parents, while older crew, and nearly all crew from third world countries have a house or apartment sitting either empty or with family in it while the crew member is on the ship, so the rent/mortgage continues to get paid, and the family still needs groceries, clothes and shoes.

[newmexicoNita]

I just recently returned from a cruise on the Spirit, and again was perplexed with a gratuity issue. Perhaps someone could shed some light! In the 'old' days, the gratuity was paid in cash and a recommended stipend was suggested for the room steward, the waiter, the assistant waiter (yep they had those then), the Maitre'D and perhaps others I have forgotten. You could then easily judge how much additional should be added to recognize exceptional service.

Now, for good reasons (I'm sure some skipped tipping, etc), the cruise lines have imposed a service charge to substitute for this initial cash gratuity, though some of us want to still recognize good service. The problem is that we no longer are told how much of that daily charge goes to the waiter or the room steward. Thus, it is harder to gauge the appropriate amount for an added stipend. I presume that they apparently have some algorithms that reward "vacation heroes" or others, but I'm just trying to get a handle on how many 'behind the scenes' people are diluting the pot - I'm not questioning the appropriateness of the behind the scenes people" being covered, just trying to assess who gets what!!

I don't think anyone, even a few who think they know can asnwer for sure. I will add, we usually give extra to our cabin steward. Only once recently have we not left him/her an additional tip; usually $25 for a 7 day cruise. We sometimes leave an extra $ each time we order a drink if the wait person is really on the ball and we have on rare occasions given a few extra $s to the dining room wait staff, again if the service is outstanding. This is almost always the case in the speialty dining rooms. There are no cut and dry rules about this and no one should expect anything extra.

[Love my butler]

That is why it doesn't matter how the DSC is divided, it is not a tip.

 

Yet NCL says the EXACT opposite. Whom to believe, an anonymous internet poster or NCL? Hmm....

[newmexicoNita]

This is the problem we have with how NCL tips the staff, we don't know the breakdown. I actually wonder how much if any of it goes to the staff.

Tell us which lines you have cruised in the past 5 years that handle the DSC any differently? I know we haven't been on any that do. :confused:

 

and there is nowhere that says the crew doesn't share in the DSC. as you seem to want to think or claim.

 

I want to add and then I will keep my mouth shut: why does this topic have to come up on a monthly basis? If it isn't the tipping topic it is the drink package topic,

Edited August 18, 2017 by newmexicoNita

[actcleath]

Well, I must say I didn't expect such a vigorous discussion. It seems to me, as I read all of the comments, that what has happened is that NCL has evolved from the cash gratuity with specific defined distributions through several iterations which currently have morphed into some combination of using the money for their compensation program which includes salary and "incentives". Since they are slowly taking steps to making the removal of this service charge by the passenger more difficult (I'm not suggesting that is good or bad, just a fact), it appears this is continuing to evolve to becoming less discretionary and hence just a part, as some have said, of the overall passenger fare. Thus, the ultimate result will be to come full circle and suggest that additional gratuities are warranted for good service. For those of us who have cruised for a long time and recall this evolution from cash to a "convenience" charged to your account, this has created some confusion. To those who simply equate the service charge to a resort fee, it is viewed differently. It DOES seem to me that there is an added importance to filling out those "Vacation Hero" recognition cards for those with good service, as no doubt they have "some" part in the incentive plan. Thanks to all that responded.....

[SeaShark]

You stated "If someone simply leaves the DSC as it is, it becomes a service charge. If they reverse it and distribute as the wish, it is a tip/gratuity." Adjusting the DSC in any manner does not change the fact that it is a service charge. Tipping or not tipping is of no relevance to that fact.

 

Sorry, but you are dead wrong . . . I did NOT say that. Gampy1967 is the one who made that statement (See post #66).

 

Perhaps you should present your argument to them instead of me as I didn't make the statement you are trying to refute.

[WashyWashyHappyHappy95]

If it made Norwegian look good they would share it with the public.

 

I bet your average table cleaner in the Garden Cafe doesn't see a cent of it. Huge chunk probably goes to Miami.

[NLH Arizona]

I bet your average table cleaner in the Garden Cafe doesn't see a cent of it. Huge chunk probably goes to Miami.

I bet it doesn't and goes toward those crew member under the DSC salary and incentive plans.

[swedish weave]

If it made Norwegian look good they would share it with the public.

 

I bet your average table cleaner in the Garden Cafe doesn't see a cent of it. Huge chunk probably goes to Miami.

 

The secrecy is more reason to request refund of the DSC and tip those who serve you. At least you know where some of your money is going.

 

The cruise lines could eliminate these questions if they were open about where the funds go, so that leaves doubt about their handling of this fund.

[txagfan]

I find it humorous some of you are such champions of the worker...these folks are at best somewhat marginalized in that respect. There is a reason cruiseline employees are largely from Eastern Europe, Philippines, etc. Yes, working for cruise line is presumably a better opportunity than they have at home, but they are definitely exploited somewhat.

 

If you have that big of a moral obligation and outrage over this you should simply stop cruising. [emoji23]

 

 

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[chengkp75]

The secrecy is more reason to request refund of the DSC and tip those who serve you. At least you know where some of your money is going.

 

The cruise lines could eliminate these questions if they were open about where the funds go, so that leaves doubt about their handling of this fund.

 

And yet, many resorts in the US (and the "resort fee" or "service fee" is almost unique to North America) charge these fees, and even the Days Inn in Miami Beach charges a "resort fee", yet no one questions how this fee is used. Cruise lines use the DSC for the same reason the resorts do, it allows them to publish a lower base price and then add on to it.

[txagfan]

Chengkp75 - I don't know why we bother. They think cruising NCL gives them some unrealistic and warped idea of their actual investment and influence on this large company.

 

 

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[chengkp75]

Chengkp75 - I don't know why we bother. They think cruising NCL gives them some unrealistic and warped idea of their actual investment and influence on this large company.

 

 

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I try not to get into the "tipping" threads, but every so often I do, but I'm done with this one, I've said my piece.

[swedish weave]

And yet, many resorts in the US (and the "resort fee" or "service fee" is almost unique to North America) charge these fees, and even the Days Inn in Miami Beach charges a "resort fee", yet no one questions how this fee is used. Cruise lines use the DSC for the same reason the resorts do, it allows them to publish a lower base price and then add on to it.

 

I don't doubt what you are,saying, but if the cruise line leaves the question open, and allow guests the option to remove the DSC and tip in cash, why not handle as they allow.

 

The comparison to resorts doesn't matter, because I don't b e lieve they give you a choice.

[Scatterbrain42]

I guess its best not to ask what changed under the new 'all premium inclusive' concept :). My last 3 trips all booked at the same place resulted in 3 different results in my bills. It almost feels like a shell game at times for example the UBP 18% was charged first time but not the second time and now is gone (all inclusive).

 

I guess they are many people from Europe wanting it to be more clear and so the new 'premium all inclusive' is now going to slowly by the new norm and we can all tip extra if we want without being confused.

 

Daniel.

[Ninick]

So, after reading through all these posts, if I want to cancel the service charge, and tip individuals instead, and am right in thinking I need to tell the service desk, when is the correct time to do this, at the beginning of the cruise or on the last but one day?

[NLH Arizona]

So, after reading through all these posts, if I want to cancel the service charge, and tip individuals instead, and am right in thinking I need to tell the service desk, when is the correct time to do this, at the beginning of the cruise or on the last but one day?

First day of your cruise.

[Scatterbrain42]

First day of your cruise.

 

And my guess is that is not possible anymore under the new 'all premium inclusive' program.

 

Daniel.

[NLH Arizona]

And my guess is that is not possible anymore under the new 'all premium inclusive' program.

 

Daniel.

You are correct, I guess you will be stuck paying for it. But on the brighter side, many from across the pond have been asking that their not be a DSC and all crew's wages should be included in their cruise fare and that is what NCL gave you.

[JimS4210]

Nickels and dimes matter to NCL.

Apparently they matter to certain cruisers as well.

 

I'll never understand the people who will spend thousands on a cruise but then turn around and complain about $13 a day. Just leave the DSC as is and tip extra as you feel it's appropriate. It ain't Rocket Science...

 

Jim

[Two Wheels Only]

But on the brighter side, many from across the pond have been asking that their not be a DSC and all crew's wages should be included in their cruise fare and that is what NCL gave you.

....and some people will still complain.....:rolleyes:

 

"Part of my fare is being used to pay for things that I don't want....why should I be forced to pay for...wah wah wahhhh..."