Hotels and restaurants cannot force consumers to pay service charges
The government has barred hotels and restaurants from forcing customers to pay standard service charges as part of the food bill.
An order from the Central Consumer Protection Authority (CCPA) states that hotels and restaurants should not charge a service fee by default.
Those guidelines were released by the Department of Consumer Affairs following an increase in consumer complaints about restaurants asking for compensation in the name of the service offered, or in other words a forced gratuity.
While there was some confusion previously when the Ministry of Consumer Affairs asked restaurants and hotels not to charge for service, there were no clear guidelines, and the National Restaurant Association of India (NRAI) had argued that a charge for services was “legal”. . until the government formed a legal framework.
Now the latest guidelines are clear and consumers have the right to complain to the National Consumer Helpline (NCH) against any service charges. Consumers can also submit a complaint electronically via the e-daakhil portal for a quick and efficient solution.
The guidelines state, “No hotels or restaurants will automatically or standard charge a service charge.” It states that no service charges may be collected under any other name.
“There is no restriction on access to or provision of services based on the collection of service fees,” the order added.
Hotels and restaurants can no longer force customers to pay service charges; rather it would be an optional choice.
