SINGLE HSC/TIPPING THREAD (Previously "Why are gratuities not included in Fares?")

Yes, you did. ;)

I know we have 2 on some previous cruises. Last summer I don’t think we did. Maybe it was an anomily with someone sick or someone left unexpectedly. We didn’t see our one much so that makes sense; if he was short staffed.

This is a well beaten topic here. Long responses are seldom read but here is an explanation from a member here how was worked on ships for over 30 years:

 

"Originally Posted by BruceMuzz :

...This entire concept of tipping in lieu of regular wages started on the White Star Line in Britain over 100 years ago. Although it has gone through many permutations, the original concept is still basically there; great service staff will receive plenty tips and be happy to stay on the job; poor service staff will not receive very much in the way of tips and be quite happy to leave.

 

But now it is much more complicated than it was a century ago.

 

Most of the tipped crew are not from Britain, but from all over the planet. Each one of the sometimes hundreds of nationalities represented in a ships crew has a different set of tax laws that apply to his or her earnings. In most of those countries, gratuities are not taxed, but earnings are. If passenger fares are increased to cover the gratuities, the total earnings of the service staff will all be taxable - in effect further reducing their salaries.

 

Currently most cruise lines pay tipped employees around US$1 per day plus tips. The staff's official salary is very low, meaning they have little or no tax liability in their home countries. If we change to a salaried system, many countries would not only require the crew to pay income taxes on all those earnings, but would also require the cruise lines to pay local payroll taxes on those total earnings. The cruise lines would be forced to increase your cruise fares much higher to cover the substantial financial losses by the crew and the cruise line companies.

 

Each one of the sometimes hundreds of nationalities represented in a ships crew is a member of a national maritime union - often from their home country. Each union has negotiated a contract with the cruise line, specifying benefits and earnings (including tips).

 

If the cruise lines change the system of paying their service staff, all the labor contracts with all the unions would have to be renegotiated, which could take decades...

 

And if the tipping concept is removed, we are haunted by an age-old argument from our passengers. If the incentive of tipping is removed, and everyone has a guaranteed salary instead, where is the incentive to do a great job?...

 

I still agree with you that some sort of change is desperately needed. But nobody seems to be able to come up with a change that will make the situation better - unless you and I are able to convince your fellow cruisers to pay a 100% surcharge on their cruise fare."

 

In the case of your fellow passengers from Australia, it's a huge problem for cruise lines since over 90% of Australians and New Zealanders remove all gratuities for the reason they told you - they don't tip in those countries. With numbers so great the cruise line has to subsidize the gratuity pool on those sailings or the crew would strike or quit. Since this adds up to hundreds of thousands or dollars per sailing the profitability of these itineraries is removed. BruceMuzz claimed that at least two cruise lines are considering pulling out of the Australia/New Zealand markets for that reason.

I am Australian and my agent calculates the tips and adds to the price. P and O don't charge, only American Lines.

We also give extra tips to our waiters and room attendants, but feel for those behind the scenes and in the bistro areas that don't receive extra tips as a rule.

It would be better for the employees to get paid a decent wage by the cruise lines and also pay their fair share of tax to solve this annoying problem of people removing tips from the bill

This is a well beaten topic here. Long responses are seldom read but here is an explanation from a member here how was worked on ships for over 30 years:

 

Most of the tipped crew are not from Britain, but from all over the planet. Each one of the sometimes hundreds of nationalities represented in a ships crew has a different set of tax laws that apply to his or her earnings. In most of those countries, gratuities are not taxed, but earnings are. If passenger fares are increased to cover the gratuities, the total earnings of the service staff will all be taxable - in effect further reducing their salaries.

 

Are you saying cruise ship employees aren't paying taxes on their gratuities? This seems like tax evasion to me. Tipping and paying paying taxes on those tips are required in the US. If tipping promotes tax avoidance by cruise ship personnel, that is another reason not to tip. Flame away.:)

Are you saying cruise ship employees aren't paying taxes on their gratuities? This seems like tax evasion to me. Tipping and paying paying taxes on those tips are required in the US. If tipping promotes tax avoidance by cruise ship personnel, that is another reason not to tip. Flame away.:)

They’re not US residents. Why would they be paying US taxes?

I am Australian and my agent calculates the tips and adds to the price. P and O don't charge, only American Lines.

We also give extra tips to our waiters and room attendants, but feel for those behind the scenes and in the bistro areas that don't receive extra tips as a rule.

It would be better for the employees to get paid a decent wage by the cruise lines and also pay their fair share of tax to solve this annoying problem of people removing tips from the bill

P&O include it in the price in AU. There are tips involved and it’s not included in the UK so not just US lines.

They’re not US residents. Why would they be paying US taxes?

More specifically, they're not US residents, and not working on a US-flagged ship. There is really no standing for US tax authorities with regard to employee compensation on these ships we're referring to. I'm not sure but I bet the ships are even owned by some foreign-domiciled holding company rather than directly by a US company (not that that would matter - a US company operating abroad can hire foreign nationals to work in foreign companies without those employees incurring any US tax obligations).

Are you saying cruise ship employees aren't paying taxes on their gratuities? This seems like tax evasion to me. Tipping and paying paying taxes on those tips are required in the US. If tipping promotes tax avoidance by cruise ship personnel, that is another reason not to tip. Flame away.:)

 

We're not talking about avoiding US taxes but taxes paid to other countries. If those other countries want to change their tax laws to include gratuities, that is their business. There is no reason for us to take any actions to influence how they generate tax revenue.

 

That said: if you don't want to pay gratuities, you can always find a reason.

I am Australian and my agent calculates the tips and adds to the price. P and O don't charge, only American Lines.

We also give extra tips to our waiters and room attendants, but feel for those behind the scenes and in the bistro areas that don't receive extra tips as a rule.

It would be better for the employees to get paid a decent wage by the cruise lines and also pay their fair share of tax to solve this annoying problem of people removing tips from the bill

 

There is a very simple way to avoid feeling sorry for those "behind the scenes and in the bistro areas". All you have to do is pay the Hotel Service Charge.

There is a very simple way to avoid feeling sorry for those "behind the scenes and in the bistro areas". All you have to do is pay the Hotel Service Charge.

 

Very simple, indeed!

 

I think most people do leave the HSC charge in place. I also think most don't tip in addition--which is perfectly OK. When we've tipped our waiters extra, they've been surprised.

Are you saying cruise ship employees aren't paying taxes on their gratuities? This seems like tax evasion to me. Tipping and paying paying taxes on those tips are required in the US. If tipping promotes tax avoidance by cruise ship personnel, that is another reason not to tip. Flame away.:)

 

Did you REALLY need "another reason not to tip"?

 

An HONEST cheapskate will just stiff people and be done with it.

Interesting that we’re discussing the merits of tipping, wages, and personal income tax impacts when cruise lines pay virtually no US taxes. They hide behind not being US based companies and by registering their ships in countries like Liberia, Panama, and the Bahamas.

Interesting that we’re discussing the merits of tipping, wages, and personal income tax impacts when cruise lines pay virtually no US taxes. They hide behind not being US based companies and by registering their ships in countries like Liberia, Panama, and the Bahamas.

Trying to float "two wrongs make a right" isn't going to fly. What they do in that context has nothing to do with what you do in this context.

 

This post may have been entered by voice recognition. Please excuse any typographical errors.

We're not talking about avoiding US taxes but taxes paid to other countries. If those other countries want to change their tax laws to include gratuities, that is their business. There is no reason for us to take any actions to influence how they generate tax revenue.

 

Then there is no reason for us to export our values/mores regarding tipping on to the people who come from other countries. I urge everyone to think before they tip!

Did you REALLY need "another reason not to tip"?

 

 

Nope. But, I found another heinous reason not to tip and will add it to the others.

I tip based on performance.

 

Auto tips are essentially union based philosophy - you get paid irrelevant to performance.

 

I agree, US/Canada based tipping % is not necessarily relevant based on the free cash flow to cruise corporations. Corporations seem to be doing very well.

 

Too many posts on CC in the last 2-3 years indicate that staff performance has been reduced once auto-tipping is in place.

 

Further, cruise lines have significantly, significantly, reduced staffing levels post auto-tipping. Great, more revenue to the cruise lines and less service to guests - not.

 

Behind the scenes staff should be paid from base fare - those that interact with staff some base fare and balance from performance.

 

No wonder I have reduced cruising by 2/3 in last 3 years.

 

Go back 10 years - you mean staff were treated worse - doubt it.

 

Consumers have been "trained" to auto-tip without consideration to the service they receive.

 

Not.

Of course, vacation alternatives work the same way and/or have their own foibles in deference to the American consumer's maniacal penchant for lowest price tag without regard to the impact on quality.

I tip based on performance.

 

Auto tips are essentially union based philosophy - you get paid irrelevant to performance.

 

I agree, US/Canada based tipping % is not necessarily relevant based on the free cash flow to cruise corporations. Corporations seem to be doing very well.

 

Too many posts on CC in the last 2-3 years indicate that staff performance has been reduced once auto-tipping is in place.

 

Further, cruise lines have significantly, significantly, reduced staffing levels post auto-tipping. Great, more revenue to the cruise lines and less service to guests - not.

 

Behind the scenes staff should be paid from base fare - those that interact with staff some base fare and balance from performance.

 

No wonder I have reduced cruising by 2/3 in last 3 years.

 

Go back 10 years - you mean staff were treated worse - doubt it.

 

Consumers have been "trained" to auto-tip without consideration to the service they receive.

 

Not.

Autotiping was in place for a lot longer than 2-3 years. Longer than 10 years on most of mass market lines.

I am OK with this, would prefer cash tips, but realize that in this case behind the scene folks receive very low compensation, and that more and more cruisers (especially international) just withhold cash tips or reduce to minimum.

 

I'd like lines to just include tips into their fares, so we don't subsidize people who remove auto tips, but there are some tax laws preventing this.

 

Last 3 years we cruise 5 a year and loving it. :)

Sorry, it's been a couple of years since our last cruise. What is the daily fee? We are looking to go later this year. Thanks for your help. :D:D:D:D

$13.50 per day per person in regular cabins and $15 in suites.

$13.50 per day per person in regular cabins and $15 in suites.

 

Thank you for your quick response. Appreciate it.

$13.50 per day per person in regular cabins and $15 in suites.

 

Of course this is subject to change (go up) at any point in time..

Hi

 

We have cruised multiple times in many regions of the world but not with HAL. In the past few years for cruises booked in Australia, either through the cruise line or an Australian TA or even on board in other areas of the world when they know you are Australian, most cruise lines include gratuities in the advertised price along with any taxes and port fees etc.

 

We are considering our first cruise with HAL and I cannot tell from the website whether the advertised prices on HAL include the cost of gratuities if booked from Australia or not.

 

In line with our consumer law, Australian consumers are used to the advertised price being "all inclusive" and many cruise lines have implemented this approach in Australia.

 

I have no problem at all paying gratuities (and we usually add extra cash tips in envelopes at the end of the cruise for good service). I would just like advice on whether the advertised price includes them or not.

 

Thank you for any advice.

On the HAL USA website gratuities which HAL names Hotel Service Charge are not included in the advertised rates.

• 13.50 per guest per day for regular staterooms (interior, ocean-view and verandah)
  
• $15.00 per guest per day for suites
  

In line with our consumer law, Australian consumers are used to the advertised price being "all inclusive" and many cruise lines have implemented this approach in Australia.

 

I suspect it has more to do with where the ship sails than where the cruise is booked. If it departs from Australia, is one thing. If it departs from Florida, it is another. The best thing for you to do is contact HAL directly and ask them about the specific cruise you have in mind.

 

All though I do not support this approach, you can always remove the service charge and then give your envelopes to who you choose. But, you should remember that the service charge includes members of the crew you may not contact on a regular basis. You might have problems locating these crewmembers to give them an envelope. BTW, HAL does add a service charge to all bar products. You do not have the option to reduce/remove this charge.

 

You should also be aware of this: On those cruises where there is a service charge added to your daily bill, Holland policy is that should you remove the service charge, those members who you give gratuities directly in cash are required to hand that cash into the cruise line where it goes into the service charge pool for distribution to the crew. While some deny this is Holland policy, the majority of posters argue that this policy does exist.

We’re based in Brisbane & used HAL for the Inside Passage Cruise last year.

 

Gratuities were not included in the fare. We travelled with Viking in the Med the year before and they were included ( which we prefer).

 

With HAL we ended up paying their recommended amounts and paid by debit card at cruises end (along with any other items we purchased). It was seamless.