Do You Have to Pay a Mandatory Gratuity?

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In many countries, including the United States, it is customary and expected to tip after a meal. If the service was excellent or if you are dining at a high-end restaurant, you may desire to offer a higher tip amount. Generally speaking, mandatory gratuity in the United States is instituted by a restaurant for larger parties in an effort to ensure the restaurant and its staff receive appropriate compensation for the opportunity loss to serve other parties during the time of your visit. Is gratuity mandatory, though?

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Must You Pay Mandatory Gratuity?

The short answer is yes, you must pay a mandatory gratuity, as it is not technically a tip, but rather a legally enforceable service charge. If a restaurant's menu stipulates that it has a gratuity of 20 percent for parties of six or more, for instance, you will be required to pay it along with your bill. This is a common scenario in which gratuity is added to your bill. Percentages required will vary based on the size of your party, the type of establishment you are dining at and the standard tipping percentages at the time (gratuity is often set at a slightly higher rate than standard tipping percentages).

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When you sit down to eat, look at the menu. Often, a note about any sort of mandatory gratuity can be found on the bottom of the first page, or sometimes on the last page of the menu. If you are unsure, you can check with your server. Most restaurants do not charge gratuity unless your group is large, typically six or more.

The restaurant may institute gratuity on larger parties because, oftentimes, big groups like to split their bills. Unfortunately, while you're dining out and having a good time, especially with a number of other people, it can be difficult to accurately calculate the tip each member of the group would need to leave to appropriately compensate the server. Waitstaff are often shorted when it comes to tips from large parties, hence the mandatory gratuity. When you view the gratuity through this lens, it likely seems quite reasonable.

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Banquet Halls and Wedding Venues

In other scenarios, gratuity may be instituted regardless of party size, but instead based on the sort of establishment. For instance, many wedding reception venues, banquet halls and other similar facilities make gratuity a part of their fee. This is for good reason; they must provide staff to serve your guests their meals, but guests at a wedding or event are unlikely to provide tips during the party (nor would you probably want them to).

This allows guests at a banquet facility to enjoy the celebration and automatically adds an extra 20 percent (or another figure as determined by the restaurant) to the bill. If you think the servers at your event really went above and beyond, you can always offer a tip above the gratuity. That is at your discretion, however, and is not mandatory like a gratuity.

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Mandatory, or automatic gratuity, is legal if it is clearly spelled out on your menu or presented to you in some manner before your meal. Different states have their own laws about gratuity, but the IRS permits gratuity as a service charge, and there are not any laws that supersede this on a federal level to negate its legality.

Since this practice is legal, the onus is on you, as a diner in a restaurant, to verify whether a gratuity will be added to your bill. If you are unsure, you can check your menu or ask your server or a manager. If you have an issue with the service, you should bring that up with a member of the restaurant staff before it comes time to pay the bill. This will give them a chance to rectify the issue.

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If they are willing to remove some of the charges from your tab, perhaps for food or drink that did not meet your expectations, then you should feel more comfortable paying the mandatory gratuity. Rarely is a waiter or waitress at fault for the quality of the food you are served, so arguing against a gratuity for a lackluster meal is not usually the best course of action.

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