There is a major inequity in distribution of the Hotel Service Charge

[Stevanb]

Hal needs to go back to when port fees taxes and gratuities where included in the cruise price. That solves the problem . When they claim they had bad service was that for every employee ? Why should the crew lose money for on bad experience. Gratuities are added onto the drinks and you can not remove that even if the waiter is not friendly or any other problem . Should be the same for the cruise

[Billthekid]

I initiated this thread to elicit comments about the Hotel Service Charge. I believe it started as a gratuity based concept and has now developed into an abuse. It is a required charge by HAL which you can adjust as desired. Why is it charged to your room instead of being part of the cruise cost like port charges. Just add another line to the invoice.

 

My last cruise included prepaid gratuities being paid for by Holland. Now did Holland actually pay those funds into the tip pool? Or did the the crew members not receive any gratuities at all from me. (I did tip in cash to several crew members because of the excellent work). I doubt Holland added those funds to the tip pool.

 

Holland has the same fleet wide hotel service charge no matter the size of the ship or number of cruise members. So on some ships the crew members in the pools are larger or smaller and those contributing to the pool is likewise.

 

On our Rotterdam cruise the crew count was around 600. Excluding officers, front desk, tours, entertainers, casino, gallery, wine staff, bar staff, managers, and sales staff, I would estimate 300 crew members in the "pool". 1,400 passenger paying $13.50 (+ or -) would generate $567,000 per month, or $1,890 per crew member which is approximately what the cruise industry's average salary of $2,000 per month. So in effect, the hotel service charge is in fact not a gratuity as originally created , but has become a salary payment.

[JT1962]

Is 1997 the year the HSC was introduced?

 

 

 

According to the OP’s first post, which is why I used that date.

 

 

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[RDC1]

Or free to remove from your bill because the cruise lines are involved in fraud when they represent these payments go to the workers. Sometimes we as humans need to stand up for what is right.

Actually it is not fraud. The cruise lines are listed on US stock exchanges. As a result they must follow SEC rules for their accounting systems. That means that when it comes to tips. There are a few rules that they must follow in order to get beneficial treatment for the tip money. Such money does not go into the company accounting system, it is neither a revenue nor an expense, which means the company shows a higher net margin.

The employees themselves also get some benefits under that treatment, depending upon the tax and retirement laws in their home countries.

 

The rules include that while the money may be pooled, all of the money received must be distributed to employees. They may not be retained by the corporation in any way. Now all money received would be that net of things like credit card expenses, but the cruise line does not retain any funds and cannot under the financial reporting regulations. So the monies paid in do go to employees. They may be pooled and redistributed for a variety of valid reasons (different tip rates for different ships running different routes with different passenger mixes, etc.) that mean that their is not preferential benefits for a crew member being on one ship vs another.

 

Since you live in the Philippines where I have also spent a substantial amount of time, I will ask you the following question How does the income of those that go to work on the cruise ships compare to their income earning potential if they were to just stay home and work there. In that question you find why so many are willing to work on the cruise ships year after year after year. In many cases local employment is lacking, pays less, and with in many cases even worse working conditions.

[sail7seas]

Hal needs to go back to when port fees taxes and gratuities where included in the cruise price. That solves the problem . When they claim they had bad service was that for every employee ? Why should the crew lose money for on bad experience. Gratuities are added onto the drinks and you can not remove that even if the waiter is not friendly or any other problem . Should be the same for the cruise

 

 

For at least the 20 years I have sailed HAL, gratuities were never included in the cruise fare. they had a tipping not required p;olicy and that ended when HSC was instituted. Th ere were so many 'cheapos' who would leave the ship and not tip anyone It was awful they would skip dinner the last night as they knew if they came to dinner, stewards would hope for tips and others at their table would notice they had been demanding and hard to please the whole cruise but would not tip anyone. Tips were not included, they were 'not required' a huge number of us were happy t o tip and we did so but there were always some 'cheapos' We had wonderful service, liked the stewards and bartenders and wanted to tip them.

[JT1962]

Hal needs to go back to when port fees taxes and gratuities where included in the cruise price. That solves the problem . When they claim they had bad service was that for every employee ? Why should the crew lose money for on bad experience. Gratuities are added onto the drinks and you can not remove that even if the waiter is not friendly or any other problem . Should be the same for the cruise

 

 

I wish they would as well, and also include Port Charges. but don’t see it happening. The cruise lines like to market a low price, then add the additional fees. It makes it look like you are getting a deal and the competing lines do it also. Many (most?) people seem to fall for this marketing and probably aren’t going to do a full-cost analysis between cruise lines to compare apples-to-apples.

 

It’s why most airlines charge additional fees for bags, certain seats, hard copy boarding pass, etc. It gives the appearance that prices haven’t increased.

 

 

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[sail7seas]

No, prior to HSC on HAL, tips were not included in the fare but they certainly were accepted and appreciated Tips wre not equired and that created a free for all chaos of non-tippers.

 

 

NO , I would not want HAL to go back to that policy WAY too m any walked away without tipping anyone

[OlsSalt]

Another point of interest is how many former crew members leave their HAL service and training with strong working skills, improved English language skills, exposure to different cultures and travels, and a leg up for their next job after obtaining direct working experience in the global hospitality industry.

 

Entry level jobs with in-house training are harder and harder to find in the US. More US workers should be applying for these crew jobs, since the hospitality industry sector is among the top 10 in the US economy. Maybe with the new work requirement for US welfare, there will be more interest in these skill-building employment opportunities.

[VennDiagram]

According to the OP’s first post, which is why I used that date.

 

 

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Thanks I missed that (y) I don't think the HSC started in 1997, my first HAL cruise was 1999 or 2000 and I'm pretty sure it hand't been implemented then.

[oaktreerb]

Agreed, nothing more is required. If you want to give a gratuity do so directly to who you want to get it and do not let other staff members see.

 

But if you think the cruise lines are giving all the money to the crew from the service fees you are absolutely wrong. I live in the Philippines, thanks to my wife I can speak Tagalog, I have talked to workers off the ships when they are are between contracts, they do not get what you think. Some lines even require cash tips to be report and turned in, that is why I always tip in private.

 

My last cruise I like the cabin steward very much, a nice young man from Nepal. He was very helpful. So at the end of the cruise the smaller paper money I had from three ports and the coins I placed in a dish for him, and told him it was his take it the last night. Into his pocket it went. He thanked me and said "please do not report this (tip) on your comment card"

 

For these reasons and others I hate pooled service fees and will always do everything I can to remove or get rid of them. I really like Seabourn, no added fees and they don't shame anyone into tipping, they pay the staff and the staff is happy.

On Seabourn passengers are encouraged by regular Seabourn cruisers to donate to the “crew fund” rather than give additional tips to individuals.

[Irish Eyes Are Sailing]

I pay my HSC gladly, I do not resent paying it, and I usually tip a little extra to certain HAL employees who have gone the extra mile in giving good and appreciated service. That being said, I strongly resent the fact that some passengers can "remove" the HSC from their bill, for any excuse they may try to pass off as believable....due to what country they are from, their culture of "non-tipping", perceived "bad service received" or whatever they choose to say to try to convince HAL management. To me, this type of passenger is just being cheap and unfair. That really frosts my butt. I believe, IMO, that the HSC should be set in concrete, you cannot remove it for any reason. If you want to increase your HSC, that is fine, but the base HSC remains in place...no matter what. It is not fair to the crew, and it is not fair to the rest of us, who dutifully pay our HSC and are thankful for all the special service we received during our cruise vacation.

[JT1962]

My last cruise included prepaid gratuities being paid for by Holland. Now did Holland actually pay those funds into the tip pool? Or did the the crew members not receive any gratuities at all from me. (I did tip in cash to several crew members because of the excellent work). I doubt Holland added those funds to the tip pool.

 

 

 

So in effect, the hotel service charge is in fact not a gratuity as originally created , but has become a salary payment.

 

 

We had gratuities paid for by HAL as an incentive on our cruise in January. The $ amount was posted as Onboard Credit to our account and the HSCs were deducted each day on our statement. So in our case, there was a written record of the HSCs to be accounted for.

 

As far as tips / service charges being a salary payment, that has almost always been the case. Restaurant workers, cruise line workers, etc. get the vast majority of their pay as tips. This is just a way of marketing a product (meal, cruise, etc.) as cheaper than it actually is. Some companies choose to eliminate tipping, but charge a higher price to cover it. Nothing is free.

 

 

 

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[ithaca gal]

 

 

 

For these reasons and others I hate pooled service fees and will always do everything I can to remove or get rid of them. I really like Seabourn, no added fees and they don't shame anyone into tipping, they pay the staff and the staff is happy.

 

So you give a few dollars of change to the steward and screw everyone else by removing the HSC? With friends like you, who needs enemies?

[richwmn]

For those who mentioned including the Port Charges and Taxes in the fare, they are separated because of a court case that I believe happened in the 90's. People complained when the fare was adjusted due to Port Charge / Tax changes and the court ruled that in order for the lines to recoup those charges they had to be pulled out of the fare and detailed. Port Charges and Taxes sre supposed to be a direct charge of only what the cruise line was charged. It must be said, however, that many ports kick back part of the Port Charges if the line (or Group of lines like CCL and RCL) meet goals. I don't believe those kickbacks are, or have to be, refunded to the passengers.

Edited March 30, 2018 by richwmn

[Irish Eyes Are Sailing]

So you give a few dollars of change to the steward and screw everyone else by removing the HSC? With friends like you, who needs enemies?

 

bolding is mine

 

Agreed....This is why I said above that the HSC needs to be frozen in place so passengers can't remove it. Prime example = the poster you have responded to here.

[navybankerteacher]

I DO care, and thank you for the discussion started. Since I will give additional tips beyond the HSC, I like to know how the HSC is divided. I too would like to give the laundry and galley workers a fair share. Anyone who's ever done a below decks tour has seen that those folks work under very difficult, hot, sweaty conditions with no access to windows or fresh air. It's pretty brutal work, and I'd like to be able to express my appreciation. Yes, I know they signed up for it. That doesn't mean that I enjoy exploiting their poverty.

 

You can opt to increase the amount charged to you as HSC .

[sail7seas]

After HAL put in HSC in place, we continued to tip individually to those who madxe our cruisees so wonderful a and that was always aside from leaving the HSC in place I still tip my cabin and dining stewards and that is irrelant to HSC I would not dream of removing that and agree HAL should not permit people to not pay it Paying HSC should be mandatory IMO.

[Irish Eyes Are Sailing]

After HAL put in HSC in place, we continued to tip individually to those who madxe our cruisees so wonderful a and that was always aside from leaving the HSC in place I still tip my cabin and dining stewards and that is irrelant to HSC I would not dream of removing that and agree HAL should not permit people to not pay it Paying HSC should be mandatory IMO.

 

bolding is mine.

 

Amen, Sails. Nobody should be allowed to remove it....don't care what excuse they have!

Are port charges negotiable? No, not to my knowledge. And the HSC shouldn't be either. Pay it or don't cruise. JMO

[RDC1]

I initiated this thread to elicit comments about the Hotel Service Charge. I believe it started as a gratuity based concept and has now developed into an abuse. It is a required charge by HAL which you can adjust as desired. Why is it charged to your room instead of being part of the cruise cost like port charges. Just add another line to the invoice.

 

My last cruise included prepaid gratuities being paid for by Holland. Now did Holland actually pay those funds into the tip pool? Or did the the crew members not receive any gratuities at all from me. (I did tip in cash to several crew members because of the excellent work). I doubt Holland added those funds to the tip pool.

 

Holland has the same fleet wide hotel service charge no matter the size of the ship or number of cruise members. So on some ships the crew members in the pools are larger or smaller and those contributing to the pool is likewise.

 

On our Rotterdam cruise the crew count was around 600. Excluding officers, front desk, tours, entertainers, casino, gallery, wine staff, bar staff, managers, and sales staff, I would estimate 300 crew members in the "pool". 1,400 passenger paying $13.50 (+ or -) would generate $567,000 per month, or $1,890 per crew member which is approximately what the cruise industry's average salary of $2,000 per month. So in effect, the hotel service charge is in fact not a gratuity as originally created , but has become a salary payment.

 

Having prepaid gratuities as a benefit means that the cruise line pays that amount into to gratuity pool.

 

As long as the gratuity is adjustable is a good indicator that the money is in fact going to the crew as indicated. The gratuity being adjustable is one of the accounting requirements for favorable treatment of those monies, along with full distribution to the crew.

 

I think that you are misusing the industry average of $2000 per month. You are assuming that tips are in that number. That does not stand up. The reason why is as follows.

 

1. Lets assume that you are correct and that tips are included. Then the tip amount is near the average for the some of the lowest compensated members of the crew. Then either the higher paid members of the crew, those not in hotel services, including managers, officers, professional seamen, etc. Are really really poorly paid and average no more then the tips. Or the average salary does not include tips. Considering that tips does not run through the cruise line financial information I suspect the later.

 

2. if the tips are not include then the tip amounts from your calculation put the hotel staff in at least the ball park of the median salary range and that there is at least some salary in addition to tips for the lowest paid. It might be as low as one person indicated of the non-tip contracted salary being 1 dollar per day. With others in the pool making a higher salary such as supervisors, senior waiters, etc.

 

I would also submit that according to a recent report by Gallup, the median household income in the Philippines (as an example of where the hotel staff comes from) less than $3000 per year so based upon the tip calculation a crew member can make 6 times the median household income just from tips, if everyone paid the tip amount.

[RDC1]

bolding is mine.

 

Amen, Sails. Nobody should be allowed to remove it....don't care what excuse they have!

Are port charges negotiable? No, not to my knowledge. And the HSC shouldn't be either. Pay it or don't cruise. JMO

 

If it was mandatory then following SEC accounting regulations, then it would not be considered to be a tip and the the amounts paid would have to be considered as income, and amounts paid to the crew would have to be considered as salary.

[sail7seas]

Most HAL crew who are part of t he tipping pool are not subject to US. a tax laws.

 

As to HAL's tax responsibility, they have teams of accountants along with Carnival corp's to handle t hat issue. I AM NOT going there and don' t think too many CC'ers want to but they can speak for themselves. I have no interest in a tax conversation You accountants can play with it all you wish

Edited March 30, 2018 by sail7seas

[kazu]

bolding is mine.

 

Amen, Sails. Nobody should be allowed to remove it....don't care what excuse they have!

Are port charges negotiable? No, not to my knowledge. And the HSC shouldn't be either. Pay it or don't cruise. JMO

 

I agree with you 99%. There is always the chance of really bad service (I haven't experienced it on HAL but it can happen).

 

I am of the belief that if someone wants to remove it, it should be for a valid reason. If making it mandatory causes issues for the crew (which I believe it does), then let HAL make it harder to remove it. Make it mandatory to document why you want to remove it, meet with someone and prove your case, not just go to the front desk and say "take it off".

 

It's too easy to just say "remove it". There should be a justification, not just someone who wants to save money, someone who thinks they "know it all" and will "take care of their people". JMO though.

[Irish Eyes Are Sailing]

If it was mandatory then following SEC accounting regulations, then it would not be considered to be a tip and the the amounts paid would have to be considered as income, and amounts paid to the crew would have to be considered as salary.

 

I don't pretend to know accounting or SEC regulations......I don't. I just don't think it is fair for a passenger to arbitrarily remove the HSC "just because they want to", whilst the rest of us pay up as we should. It's not fair to those who pay their HSC and not fair to the the crew who gets "stiffed". There needs to be some way to ensure that the crew gets what they deserve. Bright minds more knowledgeable than mine can figure that out.....I hope.

[bUU]

Proposed new HAL marketing theme: Make every cruise a guilt trip.

Except it is not the cruise line doing that. Rather it is some passengers doing it.

 

This message may have been entered using voice recognition. Please excuse any typos.

[sail7seas]

I agree with you 99%. There is always the chance of really bad service (I haven't experienced it on HAL but it can happen).

 

I am of the belief that if someone wants to remove it, it should be for a valid reason. If making it mandatory causes issues for the crew (which I believe it does), then let HAL make it harder to remove it. Make it mandatory to document why you want to remove it, meet with someone and prove your case, not just go to the front desk and say "take it off".

 

It's too easy to just say "remove it". There should be a justification, not just someone who wants to save money, someone who thinks they "know it all" and will "take care of their people". JMO though.

 

 

 

IF the claim and reason for removing HSC is poor service. They should have consulted the proper department heads etc and had the issues addressed IF so they could have had better cruisethey did not, then it is nOT ab out poor service hey like boarded the ship fully in tending to stiff the crew. but. that is for them towork on to make themselves better travelers.

 

No matter, if it was not known during the cruise they were unhappy with service and they did not seek help t o make it better I think they should be required to pay HSC JMO

 

It likely is obvious to office staff who are the 'cheapos' and who has legitimate complaint

Edited March 30, 2018 by sail7seas