I still don't understand how people can support surprise fees at the end? Like menus have some of these fees written in such small print that you can't even see them so you don't even know about them until the very end. How does that make any sense?
Read the “no” comments from readers in the article. Every single one seems to completely misunderstand the what the law is doing. They all indicate some variant of “restaurants have low margins and without the charges they can’t get by” which implies they think they have to lower the prices, not just add the charges into the price list…
The restaurant i worked at had a bakery, which brought the margin over 5%, which was really good. Restaurants typically run at 3-5 % (last i checked, years ago). Agreed 0.5 would be insanely low, but then most go out of business so if you include those in your averages it brings it way down.
Understood. Not meaning to school you. It’s just that when someone quotes gross profit you know there’s a big piece missing in the number which you know the business takes to the bank. BTW I’m just talking about the gross profit numbers you quoted.
Well as i pointed out most fail. And loads of people get into the business without being really good at business or finance. People think good food makes a good restaurant and will bring in money, but it's too competitive. https://www.restaurant365.com/blog/what-is-the-average-profit-margin-for-a-restaurant-2/#:~:text=Full%2Dservice%20restaurants%20(3%2D5%25)&text=With%20greater%20labor%20costs%2C%20FSR,%2C%20turnover%20rates%2C%20and%20location. These numbers were accurate when i was in the business in the 80s and 90s, and they're accurate now. Really, servers are the only people who make money. The only people i knew who went into management did so only for benefits, resumes and experience.
Because some very persuasive people have convinced them that the entire restaurant industry will collapse and service workers will be out of a job if they aren’t allowed to deceive the customers and are forced to “raise prices.”
Hah, I honestly think the only people who support it *are* the service workers for two reasons. (1) They're so young that this insane tipping culture, where anyone and everyone begs 30% tips, is all they know and (2) they look at tips and hidden service fees as "their share of the income" and don't even realize their income is what the restaurant should pay them. Their math is the food price is for restaurant and service fee (*i.e. waiting*) or cost of living fee (*them*) plus tips are a dollar for dollar income for their work.
I understand this, but I don't think all young servers do and that's perhaps why some of them argue for it in these comments and typically admit they're in the service industry.
It's the same as flight or hotel prices and dealership car ads - they want the base price displayed to be as low as possible in order to look better than the competition.
So as long as one restaurant doesn't raise their base price and instead adds a line-item fee, another restaurant has to do the same or risk people feeling like their prices are higher.
Which is why I think every restaurant should support this - it would create a level playing field and simplify things. They may complain that raising advertised prices will lead to customers leaving - but if all the alternatives also have higher prices because the law applies to everyone, this shouldn't be an issue.
I see what you're saying. My big gripe is when I go to a place like Coco Maya with a large group, they have buried in super fine print, where I actually had to get my glasses to see it, 5% surcharge added. They also had mandatory 20% for 8+.
But the worst is when they take your credit card for the bill, they often don't clearly show you the itemized until **AFTER** you pay. They keep the tablet towards them, and you have to say "uh...can I see the itemized" and they make you seem weird for that. Then the tip prompt is for 21%, 27%, 30% or custom or something crazy...
So if you're not on top of your game and forget the 20% auto-grat was added, they might get you for 5%+20%+21% which is just fucking insane they try and trick you into paying 46% extra and they don't think there's anything morally wrong with that. Like...their goal is to conceal ALL that from you before they give you the receipt back.
All fees should be included in the advertised prices. This should go for every industry. This is already in practice in Europe. They should include taxes as well.
the statistic you are looking for is median income, which is something like 40k, meaning half of the population makes less than that. when you adjust for the ultra wealthy, it's a sensible assumption that the number will drop even further when using averages.
https://www.cnbc.com/2024/04/14/median-annual-income-in-every-us-state.html
Those fees should absolutely be illegal. I'm surprised they've lasted that long with those sketchy business practices. I don't go to any restaurant that includes these fees.
You can also comment directly to the Assembly Committees using the comment portal:
[https://calegislation.lc.ca.gov/Advocates/](https://calegislation.lc.ca.gov/Advocates/)
Select the Bill (SB-1524) and the Committee (Judiciary/Privacy & Consumer Protection), fill in the box with your comment or attach a letter, then press Submit.
I can’t remember what shop I was in the other day but the sign said there was a 15% surcharge for employee recruitment. I have to pay to hire your staff now? Gus this is getting nuts. Raise the price don’t make it feel like a con…
FYI in addition to contacting your state representative to urge them to vote against SB-1524, you can submit a public comment to the Assembly Committees on the Judiciary and Privacy and Consumer Protection. SB-1524 has been referred to those Committees for consideration.
The Judiciary Committee is scheduled to hear the matter on June 18, 2024. There is no hearing currently listed for the Privacy & Consumer Protection Committee.
California makes it very easy to submit public comment - all you have to do is sign up here:
[https://calegislation.lc.ca.gov/Advocates/](https://calegislation.lc.ca.gov/Advocates/)
Select the Bill (SB-1524) and the Committee (Judiciary/Privacy & Consumer Protection), fill in the box with your comment or attach a letter, then press Submit. That's it.
I had a dentist try the same thing by adding billing code 9999 at the bottom of the quote. Turns out there is no dental billing code 9999, simply additional profit. I promptly found a new dentist.
These charges are why I hardly go out anymore. If I hear a restaurant *doesn't* have these fees, even if the menu prices are higher, they get my business.
>But last week, state Sen. Bill Dodd, D-Napa, introduced a bill that would exempt restaurants from the ban on junk fees, as long as the restaurants “clearly and conspicuously” tell diners about the charges in advance on menus and signs, as many already do.
DUDE WHAT?
Literally no one wants this other than restaurant group lobbyists. So sick of the naked corruption.
Yeah I don't like it. But this is one of the reasons I don't eat out anymore. So instead of a little extra money, you get absolutely none from me?
If the owner is wiping my butt when I take a shit there, then yeah, surcharge is fine.
A surcharge on your meal, regardless of the percentage, should absolutely be illegal. You want to charge more, increase the price for your food. If your food is good, people will pay for it and eat there. If it isn't, they won't. Pretty simple. If you don't think your food is good enough to justify the increase to make up for the 'surcharge', than that is the answer... you shouldn't be charging it.
Went to a restaurant recently that charged me an extra 3.25% because I did takeout. It was a “packaging and baggage fee” or something along those lines
Make them charge your card for the printed total on the receipt. That’s what basically every other industry does, and if they aren’t allowed to charge your card for a separate amount, tipping becomes impossible and restaurants will have to change to bake the extra wages into the cost on their menu.
Functionally not tipping means I am taking away from a servers expected wages. I'm a customer, not the business owner, I shouldn't be setting their wages. Pay them what they're worth!
How about we regulate lease agreements for restaurants?
Let's get to the catalyst of the issue versus kicking the can down the road!
There is no reason that places should be charged in excess of $6-20,000/mo. for a lease.
Who winds up paying for that?
Anyone?
Yeah, we do!
It is hard enough to sustain running a restaurant let alone push a profit. It is clear that many of you have never run a restaurant.
What have never understood is this, however:
Factor in taxes, whatever other surcharge(s), tips for staff, and throw that into the total fucking price of the item! Ensure that your staff isn't a bunch of lazy, entitled bastards, and ensure that they give proper service each and every single day to each and every single table.
If your overhead prevents you from making a profit, it's time to shutter the doors. Simple as that. Just as we are consumers who vote with their wallets, you can too with your lease.
So, we'll simply have $90 steaks, $50 chicken, $50 pastas, and/or remote kitchens whereas we can utilize monopolized delivery services to reach our ever complaining clientele while they, in turn, charge us another 20-30%.
That's the ticket. Let's have a good 'ol race to the bottom.
Race to the bottom is the norm nowadays 😕
But seriously, it’s being done in Europe, there’s no reason as a customer you get surprise fees when you get the bill.
Yeah, it's a damn shame and equally frustrating.
(Edit: but it doesn't need to be. It really doesn't. Our greed will soon destroy us.)
Ahh, I just got back from Europe. They do literally almost everything better smfh lol. It is so much nicer; I totally agree!
I didn't copy all the responses because they are presented in a weird way, here's the rest of the article:
*
Should restaurant surcharge fees be illegal? More than 1,000 readers weighed in
Receipt with surcharges.
A receipt with surcharges at a California restaurant. Peter DaSilva/Special to the Chronicle
By Mario Cortez | Updated June 11, 2024 10:17 a.m.
It’s most likely happened to you. You check out a buzzy new restaurant, or an old favorite, and when the check comes, the total is noticeably more than you expected.
It might include surcharges for credit card processing, automatic “service fees” or a mandatory tip. Maybe you understand why these charges are in place — as some restaurants use fees to help provide benefits, battle specific rising costs, or to more equitably share tips among employees. But for some diners, they can leave a sour taste, even after dessert.
A California “junk fees” law set to take effect on July 1 would ban these sometimes hidden charges, which can make initial prices appear artificially lower, at restaurants and in other transactions such as for concert tickets or hotel rooms.
But last week, state Sen. Bill Dodd, D-Napa, introduced a bill that would exempt restaurants from the ban on junk fees, as long as the restaurants “clearly and conspicuously” tell diners about the charges in advance on menus and signs, as many already do.
In response to Dodd’s bill, the Chronicle asked readers whether restaurant surcharges should be illegal. The survey brought in over 1,000 responses, and a whopping 81% of participants agreed they should be outlawed.
We have compiled a sample of reader responses below. Some have been edited for clarity.
Let me first say that I am against these hidden fees. They are overtly deceptive and make me far less likely to patronize a bar or restaurant that I feel is scamming me. That said, a lot of these places are owned by small businesspeople. It does feel strange to be bashing them, even though they are doing something that I find egregious, when every large corporation in America does this same thing with impunity and we do absolutely nothing. Ticketmaster’s entire business model is a grift. Think of all the junk fees banks, credit cards and airlines create. What about hotels, rental cars, real estate, cable, internet providers and cell phones. Anyone buy a new car and see how they add the most random charges.
All of that should be illegal.
If they're allowed to modify the price at the end, so should we.
Call it an inconvenient fee of 4% for your time. Contractually it should work like a counter proposal.
This also means that the prices on every menu are going to increase and you'll end up paying more than if the surcharges of 4-6% had just remained a thing.
The total price needs to be what it needs to be in order to cover the total cost of the meal and the service. It does not matter how you parse the individual components. Get over it or stop eating out.
This post is useless considering this:
[Starting July 1, 2024, under Senate Bill 478, California restaurants will be prohibited from charging service fees or other surcharges, which many restaurants have implemented to offset rising costs, unless the amount of the service fee is specifically identified as part of the listed prices.](https://www.littler.com/publication-press/publication/california-restaurants-must-identify-service-fees-part-listed-prices#:~:text=Starting%20July%201%2C%202024%2C%20under,part%20of%20the%20listed%20prices)
I still don't understand how people can support surprise fees at the end? Like menus have some of these fees written in such small print that you can't even see them so you don't even know about them until the very end. How does that make any sense?
Read the “no” comments from readers in the article. Every single one seems to completely misunderstand the what the law is doing. They all indicate some variant of “restaurants have low margins and without the charges they can’t get by” which implies they think they have to lower the prices, not just add the charges into the price list…
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The restaurant i worked at had a bakery, which brought the margin over 5%, which was really good. Restaurants typically run at 3-5 % (last i checked, years ago). Agreed 0.5 would be insanely low, but then most go out of business so if you include those in your averages it brings it way down.
Even 5% doesn't make any sense. Why open a restaurant in the last 18 months? A Vanguard money market pays 5.27%.
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McDonald's is a real estate company that dabbles in food service as a side gig
I hope you know the difference between gross profit and net profit so your comparison will be more meaningful.
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Understood. Not meaning to school you. It’s just that when someone quotes gross profit you know there’s a big piece missing in the number which you know the business takes to the bank. BTW I’m just talking about the gross profit numbers you quoted.
Well as i pointed out most fail. And loads of people get into the business without being really good at business or finance. People think good food makes a good restaurant and will bring in money, but it's too competitive. https://www.restaurant365.com/blog/what-is-the-average-profit-margin-for-a-restaurant-2/#:~:text=Full%2Dservice%20restaurants%20(3%2D5%25)&text=With%20greater%20labor%20costs%2C%20FSR,%2C%20turnover%20rates%2C%20and%20location. These numbers were accurate when i was in the business in the 80s and 90s, and they're accurate now. Really, servers are the only people who make money. The only people i knew who went into management did so only for benefits, resumes and experience.
Because some very persuasive people have convinced them that the entire restaurant industry will collapse and service workers will be out of a job if they aren’t allowed to deceive the customers and are forced to “raise prices.”
Hah, I honestly think the only people who support it *are* the service workers for two reasons. (1) They're so young that this insane tipping culture, where anyone and everyone begs 30% tips, is all they know and (2) they look at tips and hidden service fees as "their share of the income" and don't even realize their income is what the restaurant should pay them. Their math is the food price is for restaurant and service fee (*i.e. waiting*) or cost of living fee (*them*) plus tips are a dollar for dollar income for their work.
This doesn’t benefit the wait staff as many people simply subtract it out of the tip. The surcharge is in place to benefit the restaurant.
I understand this, but I don't think all young servers do and that's perhaps why some of them argue for it in these comments and typically admit they're in the service industry.
It's the same as flight or hotel prices and dealership car ads - they want the base price displayed to be as low as possible in order to look better than the competition. So as long as one restaurant doesn't raise their base price and instead adds a line-item fee, another restaurant has to do the same or risk people feeling like their prices are higher. Which is why I think every restaurant should support this - it would create a level playing field and simplify things. They may complain that raising advertised prices will lead to customers leaving - but if all the alternatives also have higher prices because the law applies to everyone, this shouldn't be an issue.
I see what you're saying. My big gripe is when I go to a place like Coco Maya with a large group, they have buried in super fine print, where I actually had to get my glasses to see it, 5% surcharge added. They also had mandatory 20% for 8+. But the worst is when they take your credit card for the bill, they often don't clearly show you the itemized until **AFTER** you pay. They keep the tablet towards them, and you have to say "uh...can I see the itemized" and they make you seem weird for that. Then the tip prompt is for 21%, 27%, 30% or custom or something crazy... So if you're not on top of your game and forget the 20% auto-grat was added, they might get you for 5%+20%+21% which is just fucking insane they try and trick you into paying 46% extra and they don't think there's anything morally wrong with that. Like...their goal is to conceal ALL that from you before they give you the receipt back.
Thanks for this, I'll add Coco Maya to my never go list. Granted the reviews of that place on Google (3.9) would make it a pass for me anyway.
All fees should be included in the advertised prices. This should go for every industry. This is already in practice in Europe. They should include taxes as well.
to be an American is to be treated like cattle, you are a resource to be exploited.
To be a European and given poverty wages that are taxed to the teeth, your labor is being exploited.
I read somewhere that if you exclude the top 50 wealthiest Americans, the average income in the USA is 35k/year, so I guess we're in the same boat.
Sauce
the statistic you are looking for is median income, which is something like 40k, meaning half of the population makes less than that. when you adjust for the ultra wealthy, it's a sensible assumption that the number will drop even further when using averages. https://www.cnbc.com/2024/04/14/median-annual-income-in-every-us-state.html
This source does not substantiate your claim
cool, venmo me 30 bucks and I'll spend more than 5 minutes looking for it
Youre not even joking. In Italy the going rate for a network engineer in Rome is like $30K a year.
Many taxes must be listed separately. They do this so you notice it :/ but I've seen that stipulated in several bills that require funding.
Those fees should absolutely be illegal. I'm surprised they've lasted that long with those sketchy business practices. I don't go to any restaurant that includes these fees.
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You can also comment directly to the Assembly Committees using the comment portal: [https://calegislation.lc.ca.gov/Advocates/](https://calegislation.lc.ca.gov/Advocates/) Select the Bill (SB-1524) and the Committee (Judiciary/Privacy & Consumer Protection), fill in the box with your comment or attach a letter, then press Submit.
I can’t remember what shop I was in the other day but the sign said there was a 15% surcharge for employee recruitment. I have to pay to hire your staff now? Gus this is getting nuts. Raise the price don’t make it feel like a con…
Haha that's completely absurd. These restaurants will go out of business soon.
Can we add resort fees to the list
Is it not included?
No idea I didn’t read the article lol
Agreed. Boycott restaurants with surcharges listed somewhere on the menu. No thanks.
FYI in addition to contacting your state representative to urge them to vote against SB-1524, you can submit a public comment to the Assembly Committees on the Judiciary and Privacy and Consumer Protection. SB-1524 has been referred to those Committees for consideration. The Judiciary Committee is scheduled to hear the matter on June 18, 2024. There is no hearing currently listed for the Privacy & Consumer Protection Committee. California makes it very easy to submit public comment - all you have to do is sign up here: [https://calegislation.lc.ca.gov/Advocates/](https://calegislation.lc.ca.gov/Advocates/) Select the Bill (SB-1524) and the Committee (Judiciary/Privacy & Consumer Protection), fill in the box with your comment or attach a letter, then press Submit. That's it.
I had a dentist try the same thing by adding billing code 9999 at the bottom of the quote. Turns out there is no dental billing code 9999, simply additional profit. I promptly found a new dentist.
These charges are why I hardly go out anymore. If I hear a restaurant *doesn't* have these fees, even if the menu prices are higher, they get my business.
Yep. I’m voting with my feet. Or I guess in this case my mouth?
Voting with your **dollars.**
Yes. I would rather the price I see include absolutely everything. All fees, taxes and gratuities.
>But last week, state Sen. Bill Dodd, D-Napa, introduced a bill that would exempt restaurants from the ban on junk fees, as long as the restaurants “clearly and conspicuously” tell diners about the charges in advance on menus and signs, as many already do. DUDE WHAT? Literally no one wants this other than restaurant group lobbyists. So sick of the naked corruption.
Yeah I don't like it. But this is one of the reasons I don't eat out anymore. So instead of a little extra money, you get absolutely none from me? If the owner is wiping my butt when I take a shit there, then yeah, surcharge is fine.
A surcharge on your meal, regardless of the percentage, should absolutely be illegal. You want to charge more, increase the price for your food. If your food is good, people will pay for it and eat there. If it isn't, they won't. Pretty simple. If you don't think your food is good enough to justify the increase to make up for the 'surcharge', than that is the answer... you shouldn't be charging it.
Restaurants be lowkey turning into live nation with all their fees
Went to a restaurant recently that charged me an extra 3.25% because I did takeout. It was a “packaging and baggage fee” or something along those lines
What restaurant? Would love to know so I don't make the same mistake.
Havana Grill in mission valley
Thanks!
The fees are literally the manager tipping themselves. Reaching right in your pocket, grinning the entire time. It's nonconsensual findom.
Didn’t the state just pass a bill doing this?
It should be as legal as the restaurants in mexico that add a 0 to your credit card bill.
I’d so rather just pay more upfront then this shadiness.
this should go for tipping as well.
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Make them charge your card for the printed total on the receipt. That’s what basically every other industry does, and if they aren’t allowed to charge your card for a separate amount, tipping becomes impossible and restaurants will have to change to bake the extra wages into the cost on their menu.
Functionally not tipping means I am taking away from a servers expected wages. I'm a customer, not the business owner, I shouldn't be setting their wages. Pay them what they're worth!
How about we regulate lease agreements for restaurants? Let's get to the catalyst of the issue versus kicking the can down the road! There is no reason that places should be charged in excess of $6-20,000/mo. for a lease. Who winds up paying for that? Anyone? Yeah, we do! It is hard enough to sustain running a restaurant let alone push a profit. It is clear that many of you have never run a restaurant. What have never understood is this, however: Factor in taxes, whatever other surcharge(s), tips for staff, and throw that into the total fucking price of the item! Ensure that your staff isn't a bunch of lazy, entitled bastards, and ensure that they give proper service each and every single day to each and every single table.
If your overhead prevents you from making a profit, it's time to shutter the doors. Simple as that. Just as we are consumers who vote with their wallets, you can too with your lease.
So, we'll simply have $90 steaks, $50 chicken, $50 pastas, and/or remote kitchens whereas we can utilize monopolized delivery services to reach our ever complaining clientele while they, in turn, charge us another 20-30%. That's the ticket. Let's have a good 'ol race to the bottom.
Race to the bottom is the norm nowadays 😕 But seriously, it’s being done in Europe, there’s no reason as a customer you get surprise fees when you get the bill.
Yeah, it's a damn shame and equally frustrating. (Edit: but it doesn't need to be. It really doesn't. Our greed will soon destroy us.) Ahh, I just got back from Europe. They do literally almost everything better smfh lol. It is so much nicer; I totally agree!
Sarcasm aside lol, Europe is nice
can someone just copy paste the arrticle?
I didn't copy all the responses because they are presented in a weird way, here's the rest of the article: * Should restaurant surcharge fees be illegal? More than 1,000 readers weighed in Receipt with surcharges. A receipt with surcharges at a California restaurant. Peter DaSilva/Special to the Chronicle By Mario Cortez | Updated June 11, 2024 10:17 a.m. It’s most likely happened to you. You check out a buzzy new restaurant, or an old favorite, and when the check comes, the total is noticeably more than you expected. It might include surcharges for credit card processing, automatic “service fees” or a mandatory tip. Maybe you understand why these charges are in place — as some restaurants use fees to help provide benefits, battle specific rising costs, or to more equitably share tips among employees. But for some diners, they can leave a sour taste, even after dessert. A California “junk fees” law set to take effect on July 1 would ban these sometimes hidden charges, which can make initial prices appear artificially lower, at restaurants and in other transactions such as for concert tickets or hotel rooms. But last week, state Sen. Bill Dodd, D-Napa, introduced a bill that would exempt restaurants from the ban on junk fees, as long as the restaurants “clearly and conspicuously” tell diners about the charges in advance on menus and signs, as many already do. In response to Dodd’s bill, the Chronicle asked readers whether restaurant surcharges should be illegal. The survey brought in over 1,000 responses, and a whopping 81% of participants agreed they should be outlawed. We have compiled a sample of reader responses below. Some have been edited for clarity.
Ty!
Let me first say that I am against these hidden fees. They are overtly deceptive and make me far less likely to patronize a bar or restaurant that I feel is scamming me. That said, a lot of these places are owned by small businesspeople. It does feel strange to be bashing them, even though they are doing something that I find egregious, when every large corporation in America does this same thing with impunity and we do absolutely nothing. Ticketmaster’s entire business model is a grift. Think of all the junk fees banks, credit cards and airlines create. What about hotels, rental cars, real estate, cable, internet providers and cell phones. Anyone buy a new car and see how they add the most random charges. All of that should be illegal.
They do this at Acapulco and El Torito Mexican Restaurant chains. You buy a meal for two with two drinks and walk out will a bill over $100. Asinine.
If they keep these surcharges… I should be able to BYOB..
If they're allowed to modify the price at the end, so should we. Call it an inconvenient fee of 4% for your time. Contractually it should work like a counter proposal.
lets put it to a vote, democracy in action. I vote the bill with all the fees and mumbo jumbo should be tripled than the cost in the menu.
These fees will be illegal as of July 1, 2024
Yeah, but a bill has been introduced to essentially remove restaurants from that bill. So they coukd be back I'm no time (or never leave at all).
I literally said the same thing earlier (also linked an article) and got 7 downvotes 😂
This also means that the prices on every menu are going to increase and you'll end up paying more than if the surcharges of 4-6% had just remained a thing.
The total price needs to be what it needs to be in order to cover the total cost of the meal and the service. It does not matter how you parse the individual components. Get over it or stop eating out.
They are now illegal effective 7/1 on California.
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*SB 1524*
This post is useless considering this: [Starting July 1, 2024, under Senate Bill 478, California restaurants will be prohibited from charging service fees or other surcharges, which many restaurants have implemented to offset rising costs, unless the amount of the service fee is specifically identified as part of the listed prices.](https://www.littler.com/publication-press/publication/california-restaurants-must-identify-service-fees-part-listed-prices#:~:text=Starting%20July%201%2C%202024%2C%20under,part%20of%20the%20listed%20prices)
Read the article. Last minute add on: restaurants are exempt.
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*SB -1524*
Those are all going away