What is Automatic Gratuity?
Auto gratuity is a pre-determined tip that a restaurant automatically applies to a customer's bill. It is usually added to a check when dining with a large party or for special occasions, or in a specific dining circumstance that ensures guaranteed compensation for service staff.
Auto gratuity is normally based on a percentage of your total bill. Some common auto gratuity percentages include-
- 15% gratuity
- 18% gratuity
- 20% gratuity
Restaurants generally include auto gratuity for the following situations-
- Dining in large groups
- Banquets and private functions
- Catering
- Fine dining restaurants
- VIP reservations
How does auto gratuity work in a restaurant?
The restaurant's POS system usually controls the auto gratuity setting.
The process typically works as follows-
- This is a customer group that matches the restaurant's gratuity policy.
- POS calculates the percentage automatically according to the bill.
- Adding a gratuity amount to the bill.
- The customer paid the entire bill, which included gratuity.
- The gratuity is distributed according to the tipping and payroll policy of the restaurant.