WE HAVE TO PAY THE 10% SERVICE CHARGE.
Loose lips sink ships is an American English idiom meaning “beware of unguarded talk”.
American World War II poster by Seymour R. Goff, also known as Ess-ar-gee.
It took only one wrong opinion from a minister to create confusion and a mess.
Deputy Finance Minister Datuk Ahmad Maslan had said that if one is unhappy with the service provided by a hotel or a restaurant, one may choose not to pay the service charge imposed.
Could such loose talk have sunk the hotel and restaurant industries? We’ll never know.
It takes Putrajaya to correct his mistake.
“Putrajaya says 10% service charge to stay.”
Domestic Trade, Cooperative and Consumerism Ministry secretary-general Datuk Seri Alias Ahmad met with representatives from the eight government agencies and 14 non-government organisations.They came to an unanimous decision on maintaining the charge.
Putrajaya says 10% service charge to stay
Putrajaya announced today that businesses such as hotels and restaurants, can continue to collect the 10% service charge from consumers, ending confusion as to whether the fee was still allowed after the implementation of goods and services tax (GST).
Domestic Trade, Cooperative and Consumerism Ministry secretary-general Datuk Seri Alias Ahmad said after meeting with the stakeholders over the matter, the government decided to retain the practice, which was different from GST.
The decision, he said was also made to protect the workers in the industry.
However, he said hoteliers and restaurant owners are advised to display a notice informing consumer on the service charge imposed at their outlets.
Alias said although the government acknowledged the complaints from consumers, the decision had to be made because many of the workers are still earning salary as low as RM350.
“Looking at reports we get from the consumers, many disagree with the service charge imposed.
“Based on the reasons above, however, the government maintains that businesses can continue to collect service charge,” he told reporters in Putrajaya today.
Alias said that the decision was made on Monday, after holding 18 discussions with the unions, associations representing restaurants, hotels, franchise holders, and related government agencies.
The service charge, he added, may only be imposed if there was a collective agreement (CA) between the employer and the workers.
Malay Mail Online
To protect workers, Putrajaya agrees to keep service charge
UTRAJAYA, April 22 ― Putrajaya announced today that businesses can continue collecting the service charge from customers after meeting with stakeholders here on the matter, noting that abolishing the fee could negatively impact the service industry.
In a press conference at the Domestic Trade, Cooperative and Consumerism Ministry, secretary-general Datuk Seri Alias Ahmad said all parties from eight government agencies and 14 non-government organisations reached a unanimous decision at today’s meeting.
“The service charge was introduced to replace the tipping system, to compensate for low salary of workers as some hotels still pay their workers as low as RM350 a month.
“This (abolishing the charge) will make the hotel sector unattractive to local job seekers,” Alias said in one of the reasons cited for maintaining the fee.
“Based on the reasons above, the government maintains that businesses can continue to collect service charge.”
He added, however, that businesses that impose the fee on customers must have their Collective Agreements (CA) put up on display at their premises.
THERE IS AN IMPORTANT CHANGE TO Deputy Finance Minister Datuk Ahmad Maslan’s comment that if one is unhappy with the service provided by a hotel or a restaurant, one may choose not to pay the service charge imposed.
Deputy Finance Minister Datuk Chua Tee Yong pointed out that if a restaurant has put up notices at the door that there is a service charge, you have the right to choose whether you want to enter the restaurant or not.
(This implies that once you enter the place, you have agreed to pay the service charge.)
As you have been notified of the service charge, you cannot refuse to pay it.
Deputy Finance Minister Datuk Cai Zhiyong said, since restaurants and caterers have been posted outside the door to charge a service fee announcement, then the customer will have the right to choose whether or not to enter a restaurant meal without clashes with industry.
He said that caterers have informed consumers must pay a service fee, if the consumers refuse to pay the service fee, they can be refused entry to a restaurant, it is consumers ‘ rights.
IS THE DEPUTY FINANCE MINISTER CORRECT?
Deputy Finance Minister Datuk Ahmad Maslan commented that if one is unhappy with the service provided by a hotel or a restaurant, one may choose not to pay the service charge imposed.
WHAT WOULD HAPPEN IF YOU FOLLOWED HIS ADVICE?
HERE’S SOMEONE WHO DID…
My experience in the Oldtown Café this morning, you can ask the 10% service charge to be excluded from the tax invoice even though the outlet has put up a notice that 10% service charge will be imposed on every customer. Let us boycott all the F&B outlets with service charge imposed until they dropped all the service charge. No service charge shall be imposed by the F&B outlets and all service operators if the service charge is imposed on their core business. #NoSvcCharge
Tanjung MP Huang Weiyi “challenging” 10% refused to pay the restaurant service charges, triggering heated debate throughout the city, bipolar, mixed reaction of Internet users on social networking sites. But this is a restaurant owners dissatisfied with being circulated on the Internet with an eye for an eye posted on the door of a restaurant “cross” portrait of Huang Weiyi, stressed that denial of service fighter …
Monday April 13, 2015 MYT 12:19:02 PM
Tanjong MP sparks debate over refusal to pay 10% service charge
PETALING JAYA: Tanjong MP Ng Wei Aik’s refusal to pay the 10% service charge at a chain cafe in Penang recently has caused much debate on social media, according to reports.
Some have supported his actions, while others found it an unsavoury move.
Alifjandro Mokhtarm, on Facebook, criticised Ng for depriving the outlet’s workers of their bread and butter, as the RM7 service charge was their additional income.
“As an MP, you’re supposed to represent people. Why you silent over pay rise among you MPs and shout out loud about RM7 given?” he questioned.
Also heavily circulated on social media was a crossed-out photo of Ng stuck on the entrance of an unknown restaurant, stating that the eatery refused to serve him.
On his Facebook, Ng had called for a boycott of all food and beverage (F&B) businesses that imposed service charge until they buckled and dropped the fee.
“No service charge shall be imposed by the F&B outlets and all service operators if the service charge is imposed on their core business,” he added.
Ng urged other Malaysians to ask for the removal of the 10% service charge from the cafe’s tax invoice, even if the establishment had put up a notice informing customers of the impending charge.
Malay Mail Online
GST and service charge, here’s what you need to know
The chairman of Umno Youth’s Economy and Entrepreneurial Development Bureau (BEPU), Azlan Abdullah, expressed concern that consumers may not have an option.
“This is because while it is true that ‘service charge’ is not a tax collected by the government under the current Goods and Services Tax Act 2014, it does not mean that one can choose not to pay service charge imposed by restaurants and hotels.
“Based on the principles of the law of contract, when one steps into a restaurant, and upon reading the menu, agrees on the terms and conditions of the menu, and proceeds to order the food listed in the menu, one has in fact offered to be contractually bound by all the aforesaid terms, regardless of whether such desires to be bound by the terms on service charge, was consciously done or otherwise. When the order is accepted by the restaurant, a contract is then formed between the restaurant and the consumer,” the senior lawyer told Malay Mail Online.
This means that consumers cannot choose to opt out of their contractual obligation to pay the service charge that they have agreed to, unless they are able to prove that the service rendered was so bad that it is tantamount to a breach of the terms, which, in reality, is highly impractical as the burden of proof is on the consumer.
Hotels and restaurants not allowed to impose service charge
Astro Awani | Updated: April 06, 2015
KUALA LUMPUR: All hotels and restaurants are not allowed to impose service charge effective today, says the Domestic Trade, Cooperative and Consumerism Ministry (KPDNKK).
Its secretary General Datuk Seri Alias Ahmad said the charge could only be imposed if there was a collective agreement between employer and employees.
Businesses are also required to display the services provided to the customers, should they wish to impose the service charge.
Alias said the matter would be executed until a new policy is established.
He explained that service operators should explain the reason behind imposing the service charge to customers.
“Service operators should know the types of services they receive, if it is self service, what kind of service they (business) they wish to charge?
“It is the consumers rights to make a decision and no service charge rate is set,” said Alias during a press conference held at the Finance Ministry today.
Gov’t: Diners can choose not to pay service charge http://bit.ly/1y8pjo6
Friday April 10, 2015 MYT 9:02:47 AM
Many more aware it is not compulsory to pay service fee
PETALING JAYA: Many Malaysians were not aware until the recent Goods and Services Tax (GST) was implemented that it was not compulsory to pay the service charge, which is usually 10% of the total bill.
But now there is widespread outcry over the extra charge – which is taxed a further 6% on top of the GST applied to the original purchase – and many are refusing to pay the amount.
The backlash was so strong that the Domestic Trade, Cooperatives and Consumerism Ministry issued a moratorium on restaurants charging the 10%, which was first established decades ago in lieu of tipping.
According to Minister Datuk Seri Hasan Malek, traditionally, a collective agreement (CA) between employees and employers regulated the percentage of the service charge given to each employee.
However, many restaurants adopted the practice even without an agreement, with owners pocketing the 10% for themselves and workers never seeing a sen of it.
Friday April 10, 2015 MYT 8:59:52 AM
Payout means a lot to the employees, says union
GEORGE TOWN: The current 10% service charge imposed by hotels should stay because it tops up the low salary of the majority of the employees.
A National Union of Hotel, Bar and Restaurant Workers of Peninsular Malaysia official, who declined to be named, said some hotel workers only got RM350 a month.
“Imagine this is happening to hotel employees in the Klang Valley. The service charge payout means a lot to them. They depend largely on the payout for a living,” he said yesterday.
The union has 11,000 members from 130 hotels nationwide. The service charge is collected by hotels and has to be distributed to employees in accordance with the Service Charge Point allocation under their Collective Agreement (CA), after a 10% deduction for administrative purposes.
The official said the service charge payout offers a fair distribution among eligible union members compared to the tipping policy.
“Tipping only benefits the frontliners like waiters, waitresses and bellboys.
“What about those who work behind the scene, like the kitchen and housekeeping staff?”
MIC Wanita: List those allowed service charge http://bit.ly/1PiQ7XI
Friday April 10, 2015 MYT 9:02:25 AM
Service charge – for some, it’s their bread and butter
With the GST already eating into the income of households, consumers are cheering eateries that do not impose a service charge. And, for outlets that do, their workers have to put up with complaints from unhappy customers. Three of our reporters share their experience of dining at different restaurants in the Klang Valley.
A Bistro in Section 17, PJ
We went to this popular mid-priced bistro on Tuesday and ordered a pot of chamomile tea which cost RM6. So with 6% GST, it would have cost RM6.36 but the bill came to RM7 instead, inclusive of a 10% service charge (60 sen) and 6% GST (40 sen).
We told the waiter we did not want to pay the service charge and would pay RM6.36 for the price of the tea and GST.
The bistro manager came out and said they were entitled to impose the 10% service charge as it was the “cost of serving” the customers.
A famous cafe chain
Here, they only charged customers the 6% GST.
But the owner said she would consider raising the price of the food to cover the 10% service charge they had lost.
“We decided not to charge the service charge because we do not want any trouble with the Government.
A local restaurant franchise
Ignoring the current ban by the Domestic Trade, Cooperatives and Consumerism Ministry on outlets that don’t have a collective agreement (CA) with their workers, some local restaurant chains are still imposing a service charge on their customers.
One in Mutiara Damansara has a notice to inform customers that they will have to pay 6% GST and a 5% service charge.
“The service charge is for our employees,” said the restaurant manager who just called himself Harun.
He said the service charge collected was shared equally amongst the non-managerial staff.
When contacted, one of the franchise directors, who only wanted to be known as Farhan, revealed that the company was going to waive their service charge.
Farhan, 37, said the bills would continue to show that a service fee was charged, but assured customers that they would get a refund for service charges paid.
“Since last night, we’ve had customers refusing to pay the charge. Some even walked out without paying the whole bill.
Just a day after KPDNKK announced All hotels and restaurants are not allowed to impose service charge
Thursday April 9, 2015 MYT 8:17:36 AM
Restaurants and hotels to get service charge certificates
PETALING JAYA: The Domestic Trade, Cooperative and Consumerism Ministry will be issuing a service charge certificate to restaurants and hotels soon.
Minister Datuk Seri Hasan Malek said the certificate would be similar to the halal certificate so consumers would be informed about the specifics of the service charge imposed.
“You can’t say you don’t want to pay if you know (beforehand) the restaurant is charging a 10% service charge on top of the goods and services tax of 6%,” he said.
According to Hasan, the 10% service charge must be stipulated in the collective agreement (CA) between employers and employees before businesses can impose it.
“The employers decide on the amount of service charge imposed, and it is a law of contract between two parties,” said Hasan, who added that restaurants could also opt to charge a figure that was less than 10%.