Las Vegas Restaurants Are Adding Mandatory Gratuities, We Aren’t Mad

By Scott Roeben, on June 08 2022
4 min read 33 comments
Las Vegas Las Vegas Restaurants

A receipt from Sugar Factory on the Las Vegas Strip confirms what we’ve long been predicting. Las Vegas restaurants are adding auto-gratuities to checks to ensure
servers are tipped properly. Not just for large parties, for everyone.

Surprisingly, given our history of loathing service charges, we aren’t even all that mad.

Given we’re not that mad, we probably should’ve circled this in aqua or tope or something. Red just seems more dramatic.

We’ve long railed against random fees on bills at restaurants and other venues.

The worst offenders have been restaurants charging CNF fees, or “concession and franchise fees.” We colloquially call them “bullshit fees.”

Here’s some background about CNF charges.

The thing is, the new service fee at Sugar Factory isn’t that. The stated purpose of the 20% fee is (mostly) to ensure servers are tipped.

Here’s a receipt from a recent visit to Sugar Factory from Heidi W., posted to the Solo Las Vegas Facebook group.

Tipping is part of the cost of a meal. If you don’t think so, enjoy Europe.

It should be noted the Sugar Factory receipt shown was for a party of five people, split on two checks. The practice of adding an auto-gratuity for large parties is already common in Las Vegas. The cut-off is usually six people. This service charge is different because it’s on every check, no matter the party size.

The receipt is a little wonky (good luck wrapping your head around the “tip suggestion” given the “mandatory service charge” covers the tip), but says 17% of the service charge is for the service staff.

We are not a fan of the restaurant snagging 3% of what should be the server’s tip, but we are a fan of ensuring the server won’t be stiffed.

See, Las Vegas has been experiencing an unprecedented period of stiffage.

We have some theories as to why tipping has fallen off a cliff, mostly we think it’s a breakdown in civility coming out of the pandemic. Nationally, 83% of restaurant workers reported getting lower tips during COVID.

We’ve chronicled million-dollar jackpot winners tipping zero. It’s most of them, actually. We consider that unacceptable (and really bad mojo), but there are some extenuating  circumstances that might cause big winners to forget to tip.

At bars and restaurants, not tipping is inexcusable.

Sugar Factory is in the former Twin Peaks space at Harmon Corner. At least they aren’t charging for the great view. Yes, that’s a thing.

Crappy tippers have myriad excuses for not tipping, but the reality is Las Vegas runs on tips.

Some of the boneheaded excuses for not tipping include, “Pay a living wage!” and “Tipping is optional!” and “Why don’t we tip workers at McDonald’s?” and “Tipping is a tool of oppression!”

This is the kind of boneheadery we’re dealing with, and they’re not kidding.

Any discussion of tipping leads to arguments about the system of tipping itself, which has shady origins and, the crappy tipping apologists are right, the system isn’t particularly logical. (Lately, tipping requests are built into point-of-sale systems at fast food restaurants, prodding customers to tip before they’ve even received any service. Not a fan.)

But it’s the system we’ve got, and tipping is part of the culture of Las Vegas. Service industry folks, from servers to bartenders to casino dealers and many others rely on tips for their livelihood.

So, because people can’t play nice and tip, restaurants are making moves to add auto-gratuities to their tabs.

And they should.

We’ve heard so many stories from those in the bar and restaurant industries about spending hours serving high maintenance customers only to be poorly tipped, or not tipped at all. How many jobs involve making a mystery income, based upon the whim of patrons?

Being stiffed is part of the job when you work in a bar or restaurant or casino, and always has been. But things are especially bad now. One casino manager we spoke to estimates a third of all free drinks delivered on the casino floor result in zero tip. A third. For free drinks.

Enough is enough.

In the case of Sugar Factory, 17% of the service charge goes to the service staff. The 3% for “associated expenses” is irksome, but the overall goal is admirable, so it’s hard to get too riled up about this mandatory charge.

You, as a good tipper, were going to tip 20%, anyway. This charge isn’t for you. It’s for the dipshits who were going to tip 5% or nothing because their salad didn’t have the proper number of croutons or whatever.

Such charges aren’t clear-cut, of course. There’s been a lot of drama about the difference between service charges and auto-gratuities. Some of the legal wrangling has involved Nusr-Et, a brand that recently arrived in Las Vegas. Read more, because we don’t really understand most of it.

If people tipped, mandatory service charges like the one at Sugar Factory wouldn’t be necessary. (Again, they need to give the full amount to the servers. That 3% is just a sneaky CNF-style charge.)

Visitors chiming in on the discussion about the Sugar Factory bill say mandatory service charges like this are common in other cities. They might exist elsewhere in Vegas, but we haven’t encountered them personally yet.

The overall system of tipping in the U.S. seems to be coming apart, and maybe it should be dismantled, but not at the expense of front line employees. Calls for getting rid of tipping go back as far as 1916, and the debate continues to rage today.

Expect to see more auto-gratuities at Las Vegas restaurants. Some restaurants are contemplating getting credit cards when guests are seated due to the increase in dine-and-dashing. It’s already common for bars to do the same.

The conversation about tipping is far from over. We’d love to hear your thoughts.