Restaurant workers strike to restore service chargeRestaurants workers intensified their protest against the cancellation of the mandatory service charge by going on partial strike on Sunday and Monday saying they face a sharp reduction in their take-home pay due to its removal.
Restaurants workers intensified their protest against the cancellation of the mandatory service charge by going on partial strike on Sunday and Monday saying they face a sharp reduction in their take-home pay due to its removal.
Restaurant workers stopped providing services from 1 to 6 pm to protest against the association’s decision to optionalise the 10 percent service charge added to the meal bill of customers. Meanwhile, three trade unions affiliated to both ruling and opposition parties decided to shut down all member restaurants of the Restaurant and Bar Association of Nepal for an indefinite period from Tuesday.
Employees of four big restaurants in the Kathmandu Valley the Post talked to said they were worried about losing a large part of their salary despite assurances by the restaurant association that an equal amount would be added to their pay.
Many workers said they were not getting even their minimum wages. The government has set the minimum monthly salary of Rs13,450 for all industrial workers. Restaurants workers said since they were getting far below the minimum pay set by the government, they needed the extra Rs8,000 to Rs9,000 they were earning through the service charge.
“The basic salary is very low,” said a restaurant worker at Kupondol. “We are compensated by the tips collected as service charge.”
Another worker at US fast food chain KFC, Tripureshwor said, “Scrapping the service charge will not be acceptable to us.” Workers at KFC halted services from 1 to 6 pm on Sunday. “Our demand is that the 10 percent service charge should be reinstated. We will be holding a meeting today with the restaurant association, and if they don’t withdraw their decision, services will be stopped from Tuesday,” he said.
Most restaurant workers are forced to work for 9 to 10 hours daily, he added. “When we don’t get even minimum wages, overtime pay is a far cry.”
Suraj Chaulagain, a restaurant worker at Him Thai Restaurant and Bar in Jawalakhel, said that he had been receiving a good amount of money through the service charge. “The amount from service charge varies depending on customer flow,” he said. “We receive around Rs4,000 monthly from service charge. Our basic pay is Rs8,000,” Chaulagain said. “Even if both amounts are added, it is still lower than the minimum set by the government,” he said. “It’s very difficult to survive on the basic salary.”
Workers at Taas and Tawa at Kupondol said that they were receiving Rs2,500 to Rs3,000 from the service charge. Ganesh Buda, a worker at the restaurant, said that the service charge had already been removed from the restaurant. “We have been informed by the restaurant owner that he will hold talks with us later.”
Buda said that he receives Rs8,000 as basic salary and it is difficult to make ends meet. “Half of the salary goes for house rent.” He used to make Rs12,000 monthly when the restaurant used to collect service charge. “It’s hard to save money to send home.”
The decision made by the association has troubled many youths working in restaurants, he said. Scrapping the service charge was an abrupt decision that has shocked many workers. “It was a hasty decision and made without planning and discussion with workers,” said Ram Magar of the same restaurant.
Workers at Bricks Cafe said they used to get Rs8,000 to Rs9,000 monthly from the service charge. “We are getting good pay, and it’s because the service charge is added to our salary,” said Raj Kumar Katuwal, a worker at the Bricks Cafe. According to him, they draw Rs17,000 to Rs18,000 per month. “We fully support the labour unions’ protest programme because we may lose a big amount if the service charge is scrapped.”
The mandatory service charge system came into force on January 1, 2007. Since then, hotel and restaurant customers have been paying 24.3 percent extra on the menu price as 10 percent compulsory service charge, 13 percent value added tax (VAT) and 1.3 percent service tax. The VAT and service tax go to the government.
Last June, Hotel Association Nepal and the Nepal Tourism and Hotel Labourers Association ended a two-year dispute over the sharing of service charges raised from consumers. They agreed that hotel employees would get 72 percent, the hotel management would get 23 percent, Hotel Association Nepal would get 2 percent and the three trade unions affiliated to the Nepali Congress, the CPN-UML and the CPN (Maoist Centre) would get 1 percent each.
They were following the 2007 agreement under which employees get 68 percent, while the management gets 32 percent of the service charge. The Restaurant and Bar Association of Nepal did not participate in the negotiations.