A customer has raised questions about the tipping practices at Applebee's after noticing that the suggested gratuity on his bill was higher than he expected. The customer, who shared his experience in a social media video, questioned why the restaurant's payment kiosk suggested an $11.30 tip on a $49.49 bill.
According to the video, the payment screen indicated that tips were calculated after tax and before discounts. However, a 20% tip on the $49.49 subtotal would amount to $9.90, about $1.40 less than the suggested amount. The apparent explanation is that the kiosk calculated the suggested gratuity on the after-tax total of $56.50, rather than the $49.49 subtotal.
Robert Mahon, managing partner of the Mahon Hospitality Group, which operates restaurants in New York City, said that restaurants generally have some control over how their payment systems calculate suggested gratuities. "It varies from restaurant to restaurant," he said. "The systems come with default settings, but the restaurant can usually change them."
Mahon expressed his opinion that gratuities should be based on the pre-tax amount, as this is the amount for which customers are tipping. "You're tipping for the food, drinks and service — adding tax into that calculation doesn't really make sense to me," he said. "Guests can always leave more if they want."
Mahon also stressed the importance of transparency when customers are presented with suggested tipping percentages, saying that customers should be clear about what they are leaving a tip on.
NTC Report coverage is based on reporting from the original publisher.
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