A steak at celebrity chef Salt Bae’s Miami steakhouse comes with a hefty price tag of $120 and 18% service charge, with none of that service charge going to the servers. Offended by this action, 24 servers from Nusr-et Miami sued the restaurant for withholding tips and, shockingly, lost.
On March 18, 2022, the 11th Circuit Court of Appeals ruled that Salt Bae's Miami steakhouse is legally entitled to keep every penny of the 18% service charge. Despite its term, "service charge" is not a "tip" for the server, but money for the restaurant to meet payroll obligations and reinvest in itself.
The Court’s decision is based on the fact that under U.S. law, a "tip" is that which a customer may pay at their discretion, and since the "service charge" is not discretionary, it is not a tip. This ruling applies to all restaurants in Florida, Georgia, and Alabama that choose to charge a service fee.