RELATING TO SERVICE CHARGES.

Active

The official status still shows this bill as active or still awaiting another formal step.

Sponsor: SHIMIZU (Introduced by request of another party)
Last action: 2025-12-08
Official status: Carried over to 2026 Regular Session.
Effective date: Not listed

Plain English Breakdown

Checked against official source text during the last sync.

Rules for Restaurant Service Charges

This bill sets rules about when restaurants can charge a mandatory tip for large groups.

What This Bill Does

Restaurants cannot add a mandatory service charge to the bill unless there are ten or more customers in the group.
If a restaurant does add a mandatory service charge, it must be no more than 18% of the total bill.
Before adding the service charge, the server must tell the customer about it verbally and clearly show this information on the menu.

Who It Names or Affects

Restaurants that serve food or drinks
Customers dining in restaurants

Terms To Know

Mandatory gratuity service charge: A required tip added to a bill by the restaurant.

Limits and Unknowns

The bill does not say what happens if a restaurant breaks these rules.
It is unclear how this will affect smaller restaurants that do not serve large groups.

Bill History

2025-12-08 D
Carried over to 2026 Regular Session.
2025-01-23 H
Referred to CPC, referral sheet 3
2025-01-23 H
Introduced and Pass First Reading.
2025-01-21 H
Pending introduction.

Official Summary Text

RELATING TO SERVICE CHARGES.
Restaurants; Mandatory Gratuity Service Charge; Party Size; Limit; Notification
Prohibits restaurants from imposing a mandatory gratuity service charge for the sale of food or beverage services unless the party includes ten or more customers, the service charge does not exceed eighteen per cent, and the customer is notified of the service charge.

Current Bill Text

Read the full stored bill text

HB852

HOUSE OF REPRESENTATIVES

H.B. NO.

852

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

relating
to service charges
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

����
SECTION
1
.
�
Section
481B-14, Hawaii Revised Statutes, is amended to read as follows:

����
"
�481B-14
�
Hotel or restaurant
service charge; hotel porterage service charge; disposition[
.
]
; party
size; limits.
�
(a)
�
Any:

����
(1)
�
Hotel or
restaurant that applies a service charge for the sale of food or beverage
services; or

����
(2)
�
Hotel that applies
a service charge for porterage services[
;
]
,

shall distribute the service charge directly to its
employees as tip income or clearly disclose to the purchaser of the services
that the service charge is being used to pay for costs or expenses other than
wages and tips of employees.

����
(b)
�
No restaurant shall impose a mandatory
gratuity service charge for the sale of food or beverage services on a party unless:

����
(1)
�
The party
includes ten or more customers;

����
(2)
�
The mandatory
gratuity service charge does not exceed eighteen per cent of the total bill for
food or beverage services;

����
(3)
�
The server
verbally notifies the customer before the bill is paid that a mandatory gratuity
service charge is automatically applied to the bill; and

����
(4)
�
The menu
contains clear and conspicuous notice in large font indicating that a mandatory
gratuity service charge is automatically applied to the bill and the exact percentage
that will be charged.

����
[
(b)
]
(c)
�
As used in this section, unless the context
requires otherwise, "porterage" means the act of moving luggage,
bags, or parcels between a guest room and a lobby, front desk, or any area with
vehicular access at a hotel, hotel-condominium, or condominium-hotel, as
defined in section 486K-1."

����
SECTION 2.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.

����
SECTION 3.
�
This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

Restaurants;

Mandatory Gratuity Service Charge; Party Size; Limit; Notification

Description:

Prohibits
restaurants from imposing
a mandatory gratuity service charge for the
sale of food or beverage services unless the party includes ten or more
customers
, the service charge
does not exceed eighteen per cent, and the customer is notified of the service
charge.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.