An automatic gratuity, or auto-gratuity, is a tip that is automatically applied to a bill, in the absence of providing the recipient of the service with any discretion as to the amount. The current economic recession has seen a number of these "hidden fees" added to services for the first time, or simply increased to generate additional revenue without any corresponding increase in cost. However, the auto-gratuity may not actually be paid to the person providing the service.
Many consumers are familiar with the relatively common notice on restaurant menus providing for the addition of an auto-gratuity of "18% for parties of six or more". However, hotels, resorts, and cruise ships also frequently impose upon guests and passengers an auto-gratuity for dining and housekeeping staff. In the case of cruise ship passengers, this amount can be in excess of $12 per day, per passenger, which can total hundreds of dollars for a family of four on a standard seven day cruise.
Significantly, in many cases the full amount of the auto-gratuity is not actually paid to dining and housekeeping staff. Instead, the cruise ship may keep the majority of the auto-gratuity and only pass on a small portion of the fee to those actually performing the services. This is a material fact which is not disclosed to passengers paying the auto-gratuity and, by labeling this additional charge something that it is not, curise ships may be deceiving consumers into paying more for their trip than they bargained.
If you or someone you know works on a cruise ship performing services covered by an auto-gratuity, but is not, in fact, receiving full and proper payment for those services (i.e., the cruise ship is unlawfully retaining a portion of the auto-gratuity fee), please contact us to discuss your leagal options.