Govt to come out with legal framework to stop restaurants from levying service charge
New Delhi, Jun 2: The government will soon come out with a legal framework to stop restaurants levying service charge from customers as the practice is "unfair", Consumer Affairs Secretary Rohit Kumar Singh said on Thursday.
After a meeting with representatives of associations of restaurants as well as consumers, Singh said that although the associations claim the practice is legal, the Department of Consumer Affairs is of the view that it adversely affects the rights of the consumers and it is an "unfair trade practice".
"We will soon work on a legal framework because there were guidelines of 2017 which they have not enforced. The guidelines are not generally legally enforceable," he told PTI.
The meeting was attended by representatives of National Restaurant Association of India (NRAI), Federation of Hotel & Restaurant Associations of India (FHRAI) and consumer organisations, including Mumbai Grahak Panchayat and Pushpa Girimaji.
A legal framework will be legally binding on them to stop this practice. Usually, consumers get confused between service charge and service tax and end up paying, he noted.
During the meeting, representatives of NRAI and FHRAI said that levying of service charges was not illegal.
An official release said that during the meeting, major issues raised by the consumers on the National Consumer Helpline of the department were discussed. Those were related to compulsory levy of service charge, adding the charge by default without express consent of consumer, suppressing that such charge is optional and voluntary, and embarrassing consumers if they resist paying such charge.
Consumer organisations observed that levying service charge is patently arbitrary and constitutes an unfair as well as restrictive trade practice under the Consumer Protection Act, according to the release.
Questioning the legitimacy of such a charge, it was highlighted that since there is no bar on restaurants/hotels on fixing their food prices, including an additional charge in the name of service charge is detrimental to the rights of consumers, the release said.
In a statement, NRAI said the matter had also come up in 2016-17 and the association had provided its response to the government.
"Today, NRAI reiterated the points as were put up earlier in 2017. This issue had also been satisfactorily explained by us to the Competition Commission of India on a query raised by them in January 2015," it said.
NRAI President Kabir Suri said levying service charge is "neither illegal, nor an unfair trade practice as alleged, and this debate in public domain is creating unnecessary confusion and disruption in smooth operations of restaurants."
"The service charge is transparent, worker friendly and is also recognised by many judicial orders which have been shared with the department. In addition, the government also earns revenue from the service charge as tax is paid by restaurants on the same," he said.
During the meeting, FHRAI said it clarified that a restaurant collecting service charge is neither illegal nor is in violation of the law.
The association explained that a service charge, like any other charge collected by an establishment, is part of the invitation offered by the restaurant to potential customers. It is for customers to decide whether they wish to patronise the restaurant or not, FHRAI said in a separate statement.
"... a service charge is meant for the benefit of the staff and so, some establishments make a conscious choice to adopt a policy beneficial towards its staff members. Levying service charge is a general practice adopted across the globe. It is neither illegal nor violating any law. Each establishment is free to create its own policy in this regard," FHRAI Vice President Gurbaxish Singh Kohli said.
About concerns over transparency in adding service charge in the bill, FHRAI clarified that the charge is disclosed in advance and the same is clearly printed as a separate heading in the bill as a "charge", not a "tax". Thus, there is complete transparency with regard to the amount, the rate and the purpose of the charge.
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Real Madrid fines Valverde and Tchouaméni half a million euros each for altercation
Barcelona (AP): Real Madrid slapped players Federico Valverde and Aurélien Tchouaméni with half-a-million-euro ($588,000) fines on Friday for their altercation during practice.
The massive fines came a day after the midfielders tussled when the team trained. Valverde said in a post on social media on Thursday that no punches were thrown. But Valverde knocked his head on a table and he suffered a small cut that required a brief hospital visit.
On social media, Valverde initially called it a “meaningless fight” with a teammate and said “everything has been blown out of proportion."
His employers, however, considered it a significant enough breach of team discipline to nail both Valverde and Tchouaméni with fines that bite even the bank account of a top soccer player. The half-a-million euro penalties reflect the reputational damage the club was enduring in a chaotic end to a disappointing season.
In a statement, the 15-time European champion said its disciplinary action was concluded after both players expressed to the club “their complete remorse for what happened and apologized to one another.”
Madrid added they also apologized to their teammates, the coaching staff and club supporters, as well as showing their willingness to accept whatever disciplinary action the club deemed “opportune.”
Tchouaméni was back training with Madrid on Friday, two days before they play at Barcelona in a clasico. Madrid has to win otherwise Barcelona will be crowned La Liga champion.
After being notified of the fine, he posted a public apology to the club and its fans on social media.
“What happened this week in training is unacceptable,” Tchouaméni wrote. "I say this while thinking about the example we are expected to set for young people, whether in football or at school.
“Above all, I am sorry for the image we projected of the club.”
Valverde was not at practice due to the head knock.
Both players are set to play in the World Cup next month, with Tchouaméni playing for France and Valverde for Uruguay.
Chaotic end to a poor season
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The run-in between the players, who for seasons have played side by side in Madrid's midfield, came after they argued this week in previous training sessions. But tempers boiled over on Thursday. Spanish media was rife with reports that the players previously disagreed over the club's decision to let coach Xabi Alonso go after just months on the job.
It was not the only altercation involving Madrid players during training this week. Álvaro Carreras confirmed he was in a “minor” incident with a teammate. Spanish media said he and fellow defender Antonio Rüdiger got into a scuffle.
Álvaro Arbeloa, the coach who was promoted from Madrid's reserve team when Alonso was fired in January, will face tough questions on what went wrong inside the changing room when he gives a press conference on Saturday ahead of the clasico at Camp Nou.
Madrid is facing a second consecutive campaign without a major trophy amid rumors in the Spanish media that club president Florentino Pérez is considering bringing back Jose Mourinho to straighten out his underperforming team.
