Automatic tips may be taken off the table

ORLANDO SENTINELAugust 21, 2013 

If you've dined out in a big group, chances are you had an automatic tip tacked on to your bill. That practice might soon go away.

Orlando, Fla.-based Darden Restaurants may drop automatic gratuities for tables of eight or more at its chains, which include Olive Garden, Red Lobster and LongHorn Steakhouse.

Experts predict others will follow suit. An Internal Revenue Service ruling will treat automatic gratuities as wages. That could lead to higher payroll taxes for restaurants and make record-keeping more complicated.

The change means customers will get to decide just how much to shell out for service instead of paying a flat amount of 15 to 20 percent.

That makes some diners happy. But servers say no matter how good the service, they could end up with less money in their pockets if they're stuck with a table of tightwads.

Automatic tipping "protects the server in a lot of ways, because a lot of time and energy goes into those parties," said David Hayden, a Kansas City, Mo., waiter who has written a book on tipping and runs websites about the restaurant industry. "There are too many times when you can really end up in the hole waiting on a table because they didn't leave an adequate tip."

For now, Darden has dropped 18 percent automatic tipping at about 100 restaurants. But it also has started suggesting tip amounts on receipts.

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