Unlike a tip, service charges do not always go directly to the employee who took care of you. Rather, they are considered non-tip wages and are required as part of the bill payment, unlike tips which are optional.

A resort service charge is generally not considered a tip for individual staff members, although the terminology can be confusing. In 2026, most resorts define a "service charge" as a mandatory fee that goes toward the general operating costs of the property or is distributed among the back-of-house staff (such as laundry, maintenance, and kitchen prep) who do not typically receive direct gratuities. Unlike a tip, which is a voluntary amount given for exceptional personal service, a service charge is often a fixed percentage (typically 10% to 20%) added to your bill automatically. It is important to read the fine print on your folio; if a resort says the charge is "in lieu of gratuities," you may not need to tip extra. However, in many luxury Caribbean or Hawaiian resorts, the service charge does not go directly to your specific server or housekeeper. Therefore, if you receive excellent service, it is still customary to provide a separate, direct tip to ensure that specific individual is rewarded for their work.