Until now, you may have believed that the biggest pain in the ass in a group dining situation was figuring out how to split the bill. Will you piss off the server by asking to split it four ways? Can you placate the group cheapskate who doesn’t want to cover the booze? Turns out while you were sweating the small stuff, the Cheesecake Factory may have been making off with your money in a massive tip heist. According to a class-action lawsuit filed in California, the irritatingly upbeat chain restaurant with 16 billion different menu items may have been deliberately misleading customers on the suggested tip portion of the bill.
Here’s what the lawsuit claims: At the Cheesecake Factory, as at many other restaurants, the bottom of your bill comes with a handy list of suggested tipping amounts calculated for you at 15, 18, 20 or 22 percent of the bill. The trouble is, when two or more people split the bill, the new bill each person gets doesn’t update that suggested gratuity amount to reflect the new amount. Instead, the bill still suggests 15, 18, 20 or 22 percent of the combined total bill. So when it’s time to now figure out your own tipping amount, what’s suggested claims to still be those percentages, but really it’s 30, 36, 40 or 44 percent of the bill.
I know you just ate two orders of fried macaroni and cheese and had four Typhoon Punches, but did you bring your calculator? No? Oh, you just left a 40 percent tip on an order of loaded potato tots and two J.W.’s Pink Lemonades.
It happened to one of the plaintiffs, one Marcel Goldman, who said she ended up leaving a $15.40 tip on a $38.50 bill at the restaurant because it was suggested as a 20 percent tip. In fact she had left a 40 percent tip. When she realized later what she’d done, she contacted the restaurant and corporate headquarters asking them to reimburse her, but they were too busy perfecting the Bang Bang Chicken and Shrimp.
The plaintiffs claim this has been happening for at least four years across all 200 locations, and that some 80 percent of the revenue the Cheesecake Factory earns — $2.27 billion in 2016 — is charged to debit and credit cards. The lawsuit estimates that about 10 percent of those are divided up checks, affecting thousands of customers.
The lawsuit alleges that the diner relies on this suggested gratuity amount in good faith and assumes it’s accurate. As a result, they may fill it out without thinking or doing the calculations, and then leave a higher tip than they would have had they known better. The lawsuit alleges that the Cheesecake Factory is aware of the practice and that it’s deliberate.
“Consumers should be aware,” Goldman’s attorney Julian Hammond told BuzzFeed News of the practice. “Why are we left to our own devices to do arithmetic acrobatics when the suggested gratuity represented is not true? The mathematic calculation is misleading. It must end; it needs to change.”
And this here is exactly the point. Yes, it’s easy to mock someone like Marcel Goldman for paying what’s effectively a stupidity tax: If you can’t whip out a calculator or do basic math in your head, you deserve to pay more, and that’s on you. But this is some capitalist horseshit: Why should consumers have to be paranoid ‘round the clock to avoid being conned out of our money? Why shouldn’t we be able to trust the basic calculations done at the bottom of the bill, which are there allegedly to help us out, but also do something critical for the restaurant: They get us out the door faster at the end, thus making space to seat yet another table to feed (and mislead).
What’s worse, the Cheesecake Factory pitches itself as a homegrown, family-friendly chain with lots of affordable dishes (under $15), whose commitment to quality is a brand pillar. But when Buzzfeed contacted the company for a response to the lawsuit, it punted.
“All gratuity amounts listed on our guest checks are suggestions only,” spokesperson Alethea Rowe told them. “Guests are free to tip as they please. We believe our guests appreciate service provided by our hardworking staff and tip accordingly.”
Not helping matters is that this is not even the only tipping controversy the restaurant is involved in. As Buzzfeed notes, many customers are not happy with the fact that the suggested tip amount the Cheesecake Factory uses is a post-tax tip amount, and not the pre-tax tip suggestion it should be.
If you're a restaurant that has "suggested gratuity" which is suggested on subtotal and tax total.. You're an asshole #cheesecakefactory
— Adam Sadie (@AdamSadie) February 16, 2017
They note that when a Yelp reviewer took this post-tax tip suggestion complaint to the company, they punted then, too: “It was a decision by our company executives to use this figure and we do so in all of our restaurants nationwide,” the company wrote.
Anecdotally, I’ve noticed this policy of refusing to update suggested tipping amounts on split bills at many restaurants here in Los Angeles and find it irritating. I just ignore the suggested amount and do my own calculation. But it’s a reminder of the constant vigilant advocacy required of us to not be swindled by establishments we happily patronize. It’s also easy to imagine that many people—perfectly intelligent people—could glance at that suggested tip amount and still thoughtlessly pencil in the suggested amount without thinking. Then leave never the wiser, and only the broker.
Of course, getting more money into the hands of servers is a good thing. However, it’s one thing to want to tip generously. It’s quite another to be tricked into it, or at least led into it unless you’re super-duper eagle-eye about the check. And it’s unclear why it’s continually left on consumers, not employers, to ensure tipped servers make a living wage.
Also worth noting: The Cheesecake Factory is wildly successful, with some 200 locations serving up Red Velvet Cheesecake and Chicken Bellagio to around 80 million unsuspecting people a year. From a business standpoint, the quality control they employ is considered bar-none, a testament to incredible efficiency where the workflow and product is relentlessly tested, constantly improved-upon and even fanatical — every dish, for instance, is compared to a photo to make sure the presentation is correct and consistent before hitting the diner’s table.
But that sort of devotion to craft and detail could point in either direction here: It’s hard to imagine they’d deliberately undermine their own image and risk pissing off a devoted base. It’s also hard to imagine that anyone that careful about every facet of production doesn’t know exactly what they are doing.
Further adding to the irony here is that California, where the lawsuit has been filed, has a reputation for being among the stingiest tippers in the nation.
Maybe eating at the Cheesecake Factory and being overcharged is some kind of karmic justice in itself. Or perhaps the real takeaway here is that there’s always a price to pay for reliable, consistent mediocre production values, and in this case, it’s a reliable, consistently marked-up bill.
Tracy Moore
Tracy Moore is a staff writer at MEL. She covers all the soft sciences like psychology, sex, relationships and parenting, but since this is a men’s magazine, occasionally the hard ones. Formerly at Jezebel.
