Restaurant Surcharges

More Than 200 NYC Restaurants Demand Right to Add a Surcharge to Bills - Eater

Excerpt from Eater

Places from Eleven Madison Park to Jack’s Wife Freda signed an open letter

Restaurants in New York want to the right to charge diners a surcharge on their bills.

More than 200 restaurants — from Michelin-starred restaurants like Eleven Madison Park and Cafe Boulud to popular neighborhood ones like Jack’s Wife Freda and St. Anselm — have signed a letter to Mayor Bill de Blasio asking that he support their right to add a surcharge. Currently, it’s illegal in restaurants for New York to add a surcharge to bills, a law intended to protect diners from surprising fees.

But according to the open letter, full-service restaurant owners say they need to do it to help offset increasing labor costs such as higher minimum wage and rent. The idea is that tacking on a surcharge keeps the list price of dishes lower, a way to offset increasing costs while making it seem like prices haven’t gone up significantly.

“If you want to support local restaurants and staff, allow us the option of using a clearly disclosed surcharge to generate the revenue to simply survive,” the letter says.

The letter is posted on the website of the NYC Hospitality Alliance, a trade group that represents the hospitality industry and aims to “reduce regulatory burdens” on restaurants and bars.

New York City is one of the only major cities in the country that bans surcharges at restaurants. Elsewhere in the state, restaurants have been increasingly adding extra charges and noting that they’re to pay for increases in minimum wage. The Hospitality Alliance has been advocating for NYC restaurants to be able to do it as well for a couple years now, but to no avail. In 2016, such a bill failed to move forward significantly.

Restaurants are arguing the increasing difficulties to operating a full-service restaurant demand the flexibility for a surcharge, noting that even menu price increases don’t do enough to cover costs. For diners, the right to add a surcharge will mean that menu prices won’t seem like they’re getting higher — but the end bill may be slightly more expensive.

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