Reactions on HC’s stay on CCPA’s latest norm – paying service charge a matter of choice
Hon'ble Delhi HC's order granting a stay on the CCPA's recent guidelines Rakshit Sharma CEO, Rester Hotels & Resorts We are thankful for this decision taken by the government of allowing hotels to levy service charges until the
Hon’ble Delhi HC’s order granting a stay on the CCPA’s recent guidelines
CEO, Rester Hotels & Resorts
We are thankful for this decision taken by the government of allowing hotels to levy service charges until the next hearing on November 26th. Service staff will continue to avail this extra income. As mentioned earlier service charge is not imposed on any guest but it’s left as an option. It makes the staff feel that they are being taken care of and rewarded for their endless efforts.
Mr. Rishi Puri
Senior Vice President Operations & Development, Lords Hotels, and Resorts
Expressed that “Lords Hotels and Resorts is extremely pleased with the stay order by the Hon’ble High Court of Delhi on the CCPA Guidelines to prevent unfair trade practices and protect consumer interest.”
Mr. Puri further reiterated that “we in the hospitality industry feel victorious with this verdict but customers are the king/queen and it is all up to them and no hotel or restaurant can force a said consumer to pay service charges. We will inform the consumer that service charge is voluntary, optional and will be at their respective discretion.
Lords Hotels and Resorts will comply with the decision of the Hon’ble High Court of Delhi. In fact, all our units will now feature a display card outside the hotel /restaurant that “We Levy Service Charge”; which will also be featured on the menu cards of our respective restaurants.”
General Manager Operations, The Ambassador Hotel
The Central Consumer Protection Authority (‘CCPA’) has earlier issued guidelines with regards to levying service charge which has been stayed by the honourable court. The national restaurant association of India has gone to the court challenging the guidelines. The association has been opposing the guidelines from the very beginning.
The decision will provide relief to hundreds and thousands of small restaurants. The court has also said that any restaurant imposing a service charge has to display it prominently that they are charging it. This in a way protects the consumer as well, as they can decide whether to eat or not at a particular place which is levying the service charge.
However, I am of the view that restaurants can hike the menu prices if they want, but avoid imposing service charges. There are chances that people entering the restaurant may not notice the displayed message and will feel upset once they get the bill.
Some of them may decide not to come to the place at all which would mean losing a customer permanently. Where as if the menu prices are adjusted they may still have to pay the same, but they will not feel cheated or offended.
Executive Assistant Manager, Meluha The Fern & Rodas – An Ecotel Hotel
The HC order comes as a huge relief for lakhs of restaurant employees. The service charges collected from customers are distributed among the staff of restaurants and hotels. Without such charges, the well-being of restaurant employees will be affected. Some customers may be worried that the impact of the order could make dining out expensive but the practice of levying service charges is not new and many countries have been doing it at varying percentiles for some good time.
It is a fair practice when the customer is made aware of the service charge before they place an order, then there is a mutual understanding between the customer and the food outlet for the transaction.
It is business as usual until the next hearing on November 25, 2022.
Happy Service, Happy Customers!!