Gratuity and service charges

[msmoger]

The relevant wording in my post above was "booked out of Australia". No matter where you sail if you book in the US they will add the gratuities. (Hope to sail with you two again sometime. :))

 

It has been 6 or 8 years since we sailed around Australia. We (Americans) did pay the autotip. Australians (and I think Kiwis) did not.

 

Thanks for confirming.

 

Michael, same here. We leave Tuesday for Rome and are taking a Med cruise on the Crown Saturday. This will officially be my "Retirement" cruise. Given that, I suspect there will be more future opportunities to sail with you. ;)

[Toofarfromthesea]

Personally, I think it would be a much fairer system if the hotel charge were mandatory.

 

As it is, those who pay cover those who don't.

 

Smells bad to me.

 

Yes, the decent human beings cover for the . . . others.

 

You're right, it stinks. But cheapskates gotta cheap.

[Ombud]

I sailed from Sydney to Tasmania in March & base tip was automatically included

 

3 for Free from Melbourne to New Zealand next November but tips covered in package

 

OTOH: I typically tip waiter / asst waiter / maitre d' an extra $10 pp & room steward whatever left over coins I have (too cumbersome to use change) but sat with Canadians & Brits last time and they didn't. Is this just an American (Californian) thing?

[Renmar]

I sailed from Sydney to Tasmania in March & base tip was automatically included

 

3 for Free from Melbourne to New Zealand next November but tips covered in package

 

OTOH: I typically tip waiter / asst waiter / maitre d' an extra $10 pp & room steward whatever left over coins I have (too cumbersome to use change) but sat with Canadians & Brits last time and they didn't. Is this just an American (Californian) thing?

 

Tipping is not necessarily an American thing. The cheeping out by one or two couples from a country do not necessarily represent a whole nation. If that was the case, than the same could be said about Americans. We traveled with a couple (Dentist from Boston) on a tour a while back and these people snug out of the backdoor of the bus so to avoid paying our excellent driver/guide a tip. The rest of our group made up for the lost tip. (2 Americans-4 Canadians-2 Germans and 2 Brits).

 

Theo

[SinbadThePorter]

Yes, the decent human beings cover for the . . . others.

 

You're right, it stinks. But cheapskates gotta cheap.

 

Do you know where the money from your tips goes, or do you only think you know?

[Dbld777]

I'm sure that Princess finance team has studied the gratuity charge a million times and their implementation of the charge is probably based on a couple of aspects: 1) They must compete against all the other mainstream cruise lines on base price. Most American consumers are price shoppers and demand the lowest cost provider. That's one of the reasons air travel in the U.S. has turned into full airplanes with as little leg room as possible and you're also charged for many of the things that used to be included, i.e. checked bags. So, all the cruise lines would have to decide to build the gratuities into the base price in order to compete on level ground. 2) Leaving the gratuities as an optional item has tax implications. Mandatory gratuities can be considered service charges and part of the service providers income. I believe this is one of the reasons you don't see restaurants adding automatic gratuity for parties of 6 and larger, which was being done by a lot of restaurants several years ago. Maybe a corporate income tax guru can clarify this assumption. If the percentage of passengers who remove the auto gratuity remains low, it won't make financial sense to make them mandatory even if some of us would prefer it to be that way.

[RDC1]

Interesting that one can't remove that 15%, but one can remove the daily hotel charge.

 

What's with that, Princess?

 

Because that 15% is a service charge, no benefit to having it removable, so it is not.

 

The daily hotel charges are gratuity (i.e. tips) and US financial reporting laws treat them differently as long as they meet the definition of a gratuity, which includes that they must be optional (i.e. removeable)

[RDC1]

I'm sure that Princess finance team has studied the gratuity charge a million times and their implementation of the charge is probably based on a couple of aspects: 1) They must compete against all the other mainstream cruise lines on base price. Most American consumers are price shoppers and demand the lowest cost provider. That's one of the reasons air travel in the U.S. has turned into full airplanes with as little leg room as possible and you're also charged for many of the things that used to be included, i.e. checked bags. So, all the cruise lines would have to decide to build the gratuities into the base price in order to compete on level ground. 2) Leaving the gratuities as an optional item has tax implications. Mandatory gratuities can be considered service charges and part of the service providers income. I believe this is one of the reasons you don't see restaurants adding automatic gratuity for parties of 6 and larger, which was being done by a lot of restaurants several years ago. Maybe a corporate income tax guru can clarify this assumption. If the percentage of passengers who remove the auto gratuity remains low, it won't make financial sense to make them mandatory even if some of us would prefer it to be that way.

 

As far as the company is concerned no real tax benefits, though there might be to the employees, depending upon their country of residence. Benefit to the company is that gratuities are treated outside of the normal revenue/expense accounting. That is to say that the money received is not included as revenue to the company, and the money paid to employees are not considered to be an expense, as long as all money received is paid out to employees.

[Ombud]

Theo: that's good. Service employees work primarily for tips

 

SinbadthePorter: when I hand someone an envelope with money in it I trust that the person keeps it.

[c-boy]

Because that 15% is a service charge, no benefit to having it removable, so it is not.

 

The daily hotel charges are gratuity (i.e. tips) and US financial reporting laws treat them differently as long as they meet the definition of a gratuity, which includes that they must be optional (i.e. removeable)

aww understood .... thank you RDC1 Edited September 16, 2018 by c-boy

[FollowingTheSun]

When I book a European cruise as an Australian and booking through an Australian travel agent, I an expected to pay the daily gratuity.

It is only as an Australian booking a cruise originating from Australia that the gratuity is included in the price.

 

 

I would much prefer the cruise line to pay their staff a decent wage in the first place and do away with the automatic gratuity totally.

 

 

Jim

[caribill]

2) Leaving the gratuities as an optional item has tax implications. Mandatory gratuities can be considered service charges and part of the service providers income. I believe this is one of the reasons you don't see restaurants adding automatic gratuity for parties of 6 and larger, which was being done by a lot of restaurants several years ago.

 

Many USA restaurants still automatically add the gratuity automatically for parties of 6 or more. I believe the reason is so that the waitstaff does not get stiffed when a large group does not tip appropriately.

[pablo222]

Because that 15% is a service charge, no benefit to having it removable, so it is not.

 

The daily hotel charges are gratuity (i.e. tips) and US financial reporting laws treat them differently as long as they meet the definition of a gratuity, which includes that they must be optional (i.e. removeable)

 

You keep posting this.

 

Somehow princess is about to collect a mandatory service charge for drinks,

and use it to pay bar staff.

 

Yet somehow princess can't collect a mandatory hotel charge and use it to

pay dining and housekeeping?

 

That makes no sense.

 

Further, there are many, many promotions where the hotel charge is included. Somehow

princess is able to juggle that.

 

The only reason the hotel charge isn't mandatory is because it would make the upfront selling

price look bad.

 

If princess wanted to do the accounting, they could.

[Luvmyrotti]

Set to cruise the Caribbean in two weeks but checking up I find that I am expected to pay 9 dollars a day for service charge on the drinks package and 13 dollars a day gratuity that’s 22 dollars a day x two for myself and the wife 10 day cruise that’s 440 dollars is this the norm for American cruise lines

So Snikrap, I'm surprised/puzzled by the fact that this is your first post after having been a member of CC since 2012 (per your profile). :confused: I'm even more puzzled that you didn't know about the 15% gratuity on drinks or about the daily service charge. Apparently you've now become aware of it shortly before your cruise and decided to post about it. These are the threads that I find curious. ;)

[antsp]

The USA likes the system where staff have to beg for a living wage, it seems odd to the rest of the civilised world but not to them. That's the system so whilst in the USA or sailing on USA based ship its only fair to the staff/crew who do have to beg is to pay them the going rate.

[Colo Cruiser]

The USA likes the system where staff have to beg for a living wage, it seems odd to the rest of the civilised world but not to them. That's the system so whilst in the USA or sailing on USA based ship its only fair to the staff/crew who do have to beg is to pay them the going rate.

 

 

Blah blah blah, you keep posting this. :rolleyes:

If you hate Princess so much why do you continue to patronize them?

[antsp]

Little slower to respond to me today, you sleeping in late on a Sunday. No mention of Princess in my post, just the way your society makes wait staff work for $2 an hour and beg for the remainder

[bemis12]

Let's start with the assumption that our society cares or should care what you think.

 

 

Dang, I've already lost everyone.

[Ombud]

Little slower to respond to me today, you sleeping in late on a Sunday. No mention of Princess in my post, just the way your society makes wait staff work for $2 an hour and beg for the remainder

ok. Enough of the politics. Wait staff in my area (society?) gets $14 hr + tips, $15 an hour if over the bridge in SF or in a no tipping zone. You cannot pay less than minimum wage ($14 hr in our 9 counties, $12 for most of the rest of the state bit higher in another few zones .... Princess is based here)

 

Or did you just drop 1 digit? (typed $12 autocorrected to $2?)

Edited September 16, 2018 by Ombud

[antsp]

My dd earns $14 an hour, so doesn't depend on tips. Saying that she usually gets $50 tip per game

[Ombud]

My dd earns $14 an hour, so doesn't depend on tips. Saying that she usually gets $50 tip per game

and your point is? My point was that your wage 'facts' were wrong

 

Does your dd like tips?

[antsp]

$2.13 in a lot of states

[antsp]

and your point is? My point was that your wage 'facts' were wrong

 

Does your dd like tips?

Yes, but doesn't expect them. My point is pay staff a guaranteed wage that they can live on, not depending on tips.

[cruzsnooze]

Set to cruise the Caribbean in two weeks but checking up I find that I am expected to pay 9 dollars a day for service charge on the drinks package and 13 dollars a day gratuity that’s 22 dollars a day x two for myself and the wife 10 day cruise that’s 440 dollars is this the norm for American cruise lines

You can go to guest services and adjust your gratuity to any amount you want. The suggested guidelines are just that, suggested. They will not ask you any questions and it's less then a minute to do. The amounts they suggest are too high IMHO. I don't know where all that money collected under the guise of gratuity goes since Princess chooses not to tell us if it all goes to staff or some to administration fees. Rumors abound about where all this money goes but no one really knows. My belief is that $10 PP PD actually goes to staff and that's what I adjust my gratuity to.

Edited September 16, 2018 by cruzsnooze

[Ombud]

$2.13 in a lot of states

prove it

Yes, but doesn't expect them. My point is pay staff a guaranteed wage that they can live on, not depending on tips.

just looked up where you are from, that doesn't come thru on droid. Ok. Ignorance is bliss.

 

Correcting my tone: if gratuities are such a hardship for you that is regrettable but nothing anyone here can do about it. I tip .... last night at Chinese restaurant on $55 tab 20% + $1 pp at table as we were in a rush. Did the server need it? Don't know, don't care, she was great. I tip an extra $10pp to all cruise staff I regularly rely on (steward + change, waiter, asst waiter, maitre d, international cafe barista) they enhance my trip so they deserve it

Edited September 16, 2018 by Ombud