Consumers would scrap service charges in pubs and restaurants
The majority of consumers would like to have service charges removed from their bills. 63 per cent of consumers would like to see discretionary charges removed from the bills they receive from restaurants, pubs, cafes and hotels in the UK, a survey of 2,000 people by the Institute of Customer Service has found.
58 per cent think employees should be allowed to keep their full tip, following deductions required for tax.
83 per cent of those interviewed believe the government should amend consumer protection laws so that businesses are more transparent about the costs of cover charges.
Mike Petrook, director of policy for the Institute of Customer Service, told Business Reporter: “The results suggest that if the current scenario is allowed to continue customer trust will be eroded and employee engagement will fall.”
The survey, published today in response to a recent government consultation on tipping, calls for a ‘new normal’ due to the damage lack of clear service charge guidelines is doing to business.
In its survey, the institute included suggestions as to how this could be achieved.
Firstly, it suggests customers should have more say in the amount they are offering as a tip and if they choose to give one at all.
It is also proposes that employees are awarded tips directly, meaning customer experience is likely to improve due to this performance-based reward system.
In turn, this will benefit the commercial return of businesses, as by providing improved customer experiences they are more likely to build brand loyalty and attract repeat customers.
Jo Causon, CEO of the Institute of Customer Service, said: “The current lack of clarity, consistency and understanding around how service charges are paid to and received by employees is creating mistrust amongst consumers and dissatisfaction amongst employees.
“Customer priorities are changing. They are more concerned with employee attitude, behaviour and competence than they are with price – and they want to reward great service properly.
“We also know that engagement increases when employees feel they are treated fairly, meaning that a transparent approach to tipping is more likely to build engagement and, with it, excellent levels of service.”