Most customers have no problem with tipping waiters in a restaurant. When those restaurants are especially busy – such as the various eateries in and around New York City’s Times Square – you might even be tempted to tip a bit more. What’s usual – 15%? 18%?
How about 40% of the bill?
That’s how much some customers are being tricked into tipping, according to a newly filed class action.
The lawsuit accuses the restaurants of illegally adding to customers’ bills.
The lawsuit, filed in the Manhattan Supreme Court, alleges that multiple big name chain restaurants, such as Ruby Tuesdays, Olive Garden, Red Lobster, Applebee’s and Crossroads, have been adding an 18% gratuity onto bills regardless of size of a party. While customers might be used to this for parties of eight or more – an admittedly standard practice in New York – rolling out the policy to groups of any size means that some diners add their own tip on top of the bill, not realizing that it’s already been added. This effectively doubles the cost of tipping, the suit alleges.
As the city’s consumer protection laws allow a 15% addition for parties of eight or more, the plaintiff, Ted Dimond, accuses the Times Square restaurants of downright breaking the law.
According to reports, while some waiters have notified diners that the tip is already included, many remain unaware. Dimond claims that parties of four or fewer would be unaccustomed to checking to see if the tip is already included, and would thus follow custom and add their own. Allegedly, some waiters are claiming that this is simply Manhattan tradition, but Dimond’s having none of it. The lawsuit accuses the restaurants of illegally adding to customers’ bills, while Dimond says that up to 2,000 more restaurants across the city could be added to the class action. He also claims different restaurants have worked together to raise prices.
The suit seeks $50 compensation for customers, with $1,000 per “willful violation.” If restaurants are found to have deceived customers into double tipping, the total damages sought could be as much as $5.5 billion.