In recent times, a growing trend has emerged on social media: the constant request for tips or a 10% charge on total bills at establishments beyond restaurants, bars, or cafes. While tipping has long been associated with excellent service in the hospitality sector, questions have arisen regarding whether it’s legal for other types of businesses in Chile to ask for or suggest a tip. So, what does the law say, and how does tipping work in Chile?
Tipping and the Law in Chile: An Overview
In Chile, the practice of tipping is not a simple, free-for-all system, but rather one regulated by law, specifically within the Labor Code. The law sets clear guidelines about when and how tips can be requested or suggested, as well as which sectors are allowed to ask for tips.
Tipping, or “propina” as it’s known in Chile, is generally seen as a form of reward for good service. It is commonly associated with dining out at restaurants or enjoying drinks at a bar. However, recent years have seen an increase in businesses outside these traditional settings asking for a tip, especially in the form of a 10% surcharge. This has raised the question: Is it legal for businesses in other industries to request or suggest a tip?
Understanding Tipping in the Labor Code
According to Article 64 of the Chilean Labor Code, tips are a suggestion, not an obligation, for certain types of establishments. Specifically, the law applies to businesses where the service is provided through waitstaff, such as restaurants, pubs, cafes, discotheques, and similar establishments. In these cases, the employer is permitted to suggest a tip of at least 10% on the customer’s bill.
However, it’s important to note that while the tip can be suggested, it is not mandatory. The law states that customers are not required to pay the tip unless they express their willingness to do so. In other words, the customer must clearly communicate their decision not to leave the suggested 10% tip.
This provision serves as a safeguard for consumers, ensuring that tipping remains a voluntary act rather than a forced requirement. It also aligns with the expectation that tips should reflect the quality of service provided, and customers have the right to decline based on their experience.
What Does This Mean for Other Sectors?
While tipping is common in the hospitality industry, the law restricts this practice to a few specific sectors. In February 2023, the Chilean Ministry of Labor reminded the public, via a tweet from their official account (@trabejita), that according to the Labor Code, only a limited number of industries are permitted to request tips. The ministry emphasized that in some cases, businesses are requesting tips for services where customer service should already be included in the price.
The tweet made it clear that, in addition to waitstaff in restaurants and similar businesses, employees at gas stations who serve fuel are also allowed to suggest tips. However, this does not extend to other businesses, such as barbershops or hair salons, where it would be inappropriate to ask customers to leave a tip.
When Is It Inappropriate to Ask for a Tip?
The Chilean Ministry of Labor has also clarified the situations in which businesses are not allowed to ask for a tip. According to the rules, tips are not appropriate in businesses where service is provided on a self-service basis or where employees do not directly serve customers at tables. For instance, fast food establishments where customers order at the counter and pick up their food, or delivery services, fall outside the scope of tipping regulations.
Furthermore, employees working in roles unrelated to direct customer service, such as cleaning staff, luggage handlers, or security personnel at hotels, are not permitted to ask for tips. This clarification aims to ensure that tipping is reserved for those who offer personalized, face-to-face service, rather than for behind-the-scenes roles.
The Role of the Dirección del Trabajo
The Dirección del Trabajo (DT), or Labor Directorate, has also weighed in on the issue, providing additional guidance on when tips can be suggested. According to the DT, the suggestion of a 10% tip is only applicable in establishments where workers are serving customers directly at the table. This includes restaurants, cafes, and bars where waitstaff deliver food and beverages to customers.
However, the law does not apply to self-service establishments or businesses where employees only interact with customers to deliver products or handle payments. In these cases, the employer is not permitted to suggest or request a tip.
This distinction helps to clarify which industries and types of businesses can legally ask for a tip and which cannot. For example, a hotel receptionist or a cashier at a fast-food restaurant cannot request a tip because their duties do not involve providing direct, personalized service to the customer.
The Impact of Tipping on the Service Industry
The question of whether tipping should be mandatory or optional has been a topic of debate in many countries. In Chile, the law ensures that tipping remains a voluntary practice, but one that can serve as an important motivator for workers who rely on tips as part of their income. In sectors where tipping is customary, such as restaurants, waitstaff may be more motivated to provide excellent service if they know their efforts may be rewarded with a tip.
However, the rise of tipping requests in non-traditional sectors has sparked concern among consumers and workers alike. Some argue that businesses should include the cost of service in the price of the product or service rather than relying on customers to pay extra. This would eliminate the confusion and frustration that can arise when customers are asked to leave a tip for services that are typically not tipped.
A Shift in Tipping Practices
One noteworthy example of a business challenging the conventional tipping system in Chile is a French entrepreneur who, in 2023, decided to eliminate tipping altogether at his restaurant. Instead of relying on customers to leave a tip, he raised the prices of the menu items to include a fair wage for his employees. This move was a direct response to what he saw as an unfair and outdated system that left workers vulnerable to fluctuating customer generosity.
While this approach is still relatively rare in Chile, it highlights the growing conversation around tipping practices and the need for change. By eliminating the reliance on tips, businesses can provide workers with more stable and predictable wages, while also removing the pressure on customers to leave a tip.
Conclusion
Tipping in Chile is a legal and regulated practice, but it remains a complex issue. While tipping is allowed in certain sectors, such as restaurants and cafes, it is always optional. The law ensures that customers have the right to decline tipping if they do not wish to do so. The growing trend of requesting tips in non-traditional sectors has raised concerns, and businesses outside the hospitality industry should be cautious when suggesting or requesting tips.
As the conversation around tipping continues to evolve, it remains to be seen whether more businesses will follow the lead of those who are eliminating tips altogether in favor of fair wages. Ultimately, tipping should be a choice based on service quality, and both customers and employers should ensure that it is handled fairly and transparently.
