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

[slidergirl]

I always put a tip for housekeeping, regardless of where I am (unless it is a B&B or AirBnB) in the US. Having spent a day with housekeepers at one of my hotels, I am eternally grateful for their service! It is a minimum-wage job most of the time. Or, they are subcontracted to the hotel from a service provider. It is NOT an easy task! I'll put in anywhere from $3-5/day. At a full-service hotel, this would be split between the daily service HKer and the turndown service HKer. I just leave an envelope at the Front Desk with a thank-you note and the room number. On cruise ships, I may leave a tip for a steward if I ask for something special or even if I let them know they may certainly do the minimum required for my room (I'm VERY LOW maintenance). Yes, they are doing something special for me if they leave me alone, per my wishes.

 

In Europe, I normally don't leave tips unless I ask something very special from someone.

[Tampa Girl]

The majority of cruise ship employees are neither American citizens nor taxable in the USA. The IRS has no jurisdiction.

 

 

What is the cruise line's obligation to pay payroll taxes on its non-U.S. employees?

[Tampa Girl]

My understanding is that the courts are still looking at this very issue: if it's mandatory, it's no longer a tip, and if it's no longer a tip, it must be taxable income.

 

And payroll taxes must be paid by the cruise line - at least for its American employees.

[Randyk47]

What is the cruise line's obligation to pay payroll taxes on its non-U.S. employees?

 

There is no obligation. Only US citizens and legal residents are subject to US taxes. Others do not pay US taxes of any kind and in turn don't qualify for US Social Security, Medicare, or unemployment benefits. They may have income taxes or other tax obligations based on their citizenship and that country's laws.

[bUU]

They may have income taxes or other tax obligations based on their citizenship and that country's laws.

Precisely. The United States remarkably doesn't have the most restrictive tax laws with regard to every aspect... there are some aspects for which other nations are even more restrictive.

[Tampa Girl]

Precisely. The United States remarkably doesn't have the most restrictive tax laws with regard to every aspect... there are some aspects for which other nations are even more restrictive.

 

And that could be a good reason why some cruise lines do not want to build gratuities into their employees payroll checks. U.S. employees are subject to payroll taxes and non-American employees may be subject to their own taxes which would not otherwise be applicable to tips.

[RocketMan275]

Any truth to the story that most crew get their jobs through agencies that charge a fee based upon salary?

[Randyk47]

Any truth to the story that most crew get their jobs through agencies that charge a fee based upon salary?

 

There are agencies that recruit for cruise lines. There are at least a few agencies on line. Whether HAL or whatever line uses them I can't say but I'd assume they'd not exist if there wasn't business. We did meet a waitress in Kotor who was going for an interview for a job with I think NCL. She said she had used an agency to get the interview and would have to pay them a fee. None of our business so we didn't press her if it was a percentage or flat fee. She was excited and nervous as she was struggling to make 300-400 Euros a month in Kotor and the basic salary she'd be quoted for the NCL job was well above that. We were in Kotor a year later and went to the same outdoor restaurant and she was gone. Our waiter didn't know her but said a number of the staff had gotten jobs on cruise ships in the past year so we hope and think she got her wish.

Edited March 27, 2017 by Randyk47

[RocketMan275]

Thanks Randy.

[cbr663]

HAL uses 4 recruitment agencies for its ships. Details on these can be found at this HAL link: http://www.hollandamerica.com/halcareers/Shipboard.action.

 

As a FYI - Royal Caribbean explains the expect fees and payments on its Hiring website here: http://www.royalcareersatsea.com/pages/about_hiring_partners

[Tampa Girl]

Just do what you like and stop trying to tell everyone else what to do.

 

 

I'm not sure who you are responding to, but I don't see anyone telling others what they should do; only what the poster is doing.

[RocketMan275]

HAL uses 4 recruitment agencies for its ships. Details on these can be found at this HAL link: http://www.hollandamerica.com/halcareers/Shipboard.action.

 

As a FYI - Royal Caribbean explains the expect fees and payments on its Hiring website here: http://www.royalcareersatsea.com/pages/about_hiring_partners

Thanks. It appears from those links that the cruise lines pay all fees.

[igraf]

The issue is that they have been tipped already by the Hotel Service Charge. Yes, they worked hard and yes, we tip them close to two hundred dollars (via the HSC) after a one week cruise. Likewise with tips already included on beverage billings. I am happy with their service and I have tipped them.

 

No need to tip twice anymore than I would pay for the cruise twice (as much as I love HAL....).

 

igraf

 

 

..As for other tipping, I can't see why giving a little extra tip to servers in the MDR isn't a good idea if you can tell that they have really tried to give you a great dining experience. We have always tipped a little extra on the last night we are in the MDR -- sometimes a little more, sometimes a little less, depending on the servers. We have been lucky to have servers who go all out for us, so why not?...

[Randyk47]

HAL uses 4 recruitment agencies for its ships. Details on these can be found at this HAL link: http://www.hollandamerica.com/halcareers/Shipboard.action.

 

As a FYI - Royal Caribbean explains the expect fees and payments on its Hiring website here: http://www.royalcareersatsea.com/pages/about_hiring_partners

 

Great. As I said the gal in Kotor said there was a fee and while her English was quite good we or she may not have understood who was paying it. She asked us a whole bunch of questions about being a crew member on a ship which we obviously couldn't answer. One I found funny was the notion she might have to share a pretty small cabin with another person. She thought that would be an improvement as she was sharing what sounded like a very small one bedroom apartment with two and sometimes three others. 😀

[pnica]

As an Australian (though I don't currently live in Australia) who has recently discovered the joys of cruising I just want to mention that not all Aussies ask to have the service charge removed - I wouldn't think of doing so. I am aware of the charges when I book the cruise and greatly appreciate the service given, plus would always tip extra for special service. When I read these boards I wonder should I admit to my nationality when I'm cruising....

[Gail & Marty sailing away]

Maybe one day it will change.

[bUU]

Maybe one day it will change.

Perhaps, but what would have to happen for that change to come about? There is a direct connection between the current approach and the prices we pay. I don't remember if it was in this thread or another cruise line forum's tipping thread, but someone recently raised the point that the current approach effectively deprives the nations to which many crew members are citizens of tax revenues that they would otherwise collect - that in effect the current approach is aiding and abetting tax evasion. I thought it was an interesting observation, by itself, but putting the evasion aspect aside, we still have to face the fact that taking another approach means these crew members, who many folks are quick to point out deserve far more money than they are earning for the work they do, would be harmed by switching to the cost of service being fully built into the cruise fare. By all rights, a switch to truly inclusive service would not only increase the fare by the amount of the HSC, but necessarily would have to be by a grossed-up amount that would give the crew a bump in pay sufficient to cover the new tax liability that the change in approach would inflict on the crew.

 

At this point in time, I don't see any significant portion of the passenger-base for US cruises clamoring to pay more for cruises. If one cruise line did this, then all that would do is make that cruise line like arbitrarily and seemingly without "good" reason more expensive than its competitors. Passengers would punish that cruise line, and it would be forced to go back to the current approach. Changes like this, without a majority of customers insisting on it, can only come about through government action imposing the change on all competitors in the marketplace. And I don't see any significant clamoring for that either.

[Rumball]

Looking at HAL's website today I notice automatic service charges are increasing for cruises departing after May 1 2017. Also notice, though it is only obvious by comparing the new policy to the old, that daily hotel service charges per person CAN NO LONGER BE ADJUSTED.

 

The OLD policy (in effect until recently) permitted adjustments of the daily service charge by attending at the front desk and filling out a simple form, no questions asked:

"If our service exceeds or fails to meet

your

expectations,

you are free to adjust this amount

at the end of

eachsegment

and/or

voyage

. The Hotel Service Charge is paid entirely toHolland America Line crew members, and represents an important part of theircompensation. A 15% Bar Service Charge is automatically added to bar chargesand Dining Room wine purchases. In terminals, airports, ports of call and onshore excursions, we suggest that you extend gratuities consistent withcustomary local practices."

Check out the new 2017 policy under "Money Matters" on HAL's website. The new policy essentially removes the first sentence from the old policy. They don't bring this to your attention. It's actually very subtle. But the effect appears to be HAL is now charging a non-adjustable hotel service charge. There's a growing trend among the cruiselines to find revenue from charging mandatory service charges, HAL is moving with the trend. Its new policy is in line with NCL's. A family of 4 is looking at over USD $50 per day in daily service charges. These are over and above the auto-gratuities charged on drinks etc. It all adds up.

 

To be certain, I am not interested in re-igniting a senseless old debate about the merits of tipping. Heard it all before from the cruiseline cheerleaders and the cruiseline insiders guised as cheerleaders. I firmly subscribe to the view that the only tips the staff ever see are the cash you slip them discretely. The rest of these charges are cruiseline revenue/profit shamelessly pitched as gratuities. I say don't be fooled or shamed by cheerleaders.

 

It is important for families to consider, before booking a "discounted" fare on HAL, that for a one week cruise add maybe $350 to the fare you pay. For a three-week cruise, add over a thousand. A couple adds half those amounts per cabin, for even the cheapest cabin on board. But it's still a big factor to consider before booking your next cruise...the industry is always "evolving".

[donaldsc]

I will bet that the reason they are doing this is that many people were receiving excellent service but were still removing their tips because they were too cheap to pay them. Pay "tips" or have the cruise line increase the posted fare to cover increased crew salaries. To me, it is the same money.

 

DON

[alwaysfrantic]

I'm sorry they don't allow additional to be added to individual positions with a little receipt given to give to the crew member. A lot easier than having cash to tip additionally.

[Scrapnana]

I firmly subscribe to the view that the only tips the staff ever see are the cash you slip them discretely. The rest of these charges are cruiseline revenue/profit shamelessly pitched as gratuities.

 

On what do you base this belief? I have had crew members (on different lines) tell me they did receive the full amount.

[albingirl]

This is a good move, in my opinion. If they allow the passengers to adjust after they have left the cruise, like NCL, I think the headaches of the front desk staff will lessen. I never understood how people could think it's fair to the staff to remove the gratuities who have generally provided excellent service.

[1of4]

Families of 4 sharing 1 cabin have always paid close to $50/day in HSC. In 2015 we paid $11.50/pp/day. What is the change?

Edited April 22, 2017 by 1of4

[debsjc]

Thanks for pointing out the new policy I had no idea.

 

We have never withdrawn or decreased our hotel service charge, but I must admit I don't like the principle that people are not allowed to.

[Rumball]

Readers have to get through the main message (you can't adjust the service charge anymore folks) before getting to all the cheers for hotel service charges. At least each response bumps the post.

 

The target of my post is families budgeting for a holiday, not cruise line enhanced revenue cheerleaders.

 

There has been a material change in HAL's policy, maybe people ought to know?

 

Rumball