Special surcharges to become illegal in California restaurants

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By Yosi Yahoudai
Founder and Managing Partner

WALNUT CREEK, Calif. – As of July 1, it will be illegal for any restaurant in the Golden State to add special surcharges to diners’ checks, which has become a favorite method that restaurants use to lower costs and enhance employee incomes. 

Except for taxes, the surcharge disclosure law applies to all imposed add-on fees such as service fees, dining-in charges, delivery charges, credit card processing fees, and even imposed tips. But this is not crystal clear.

Attorney General Rob Bonta, who had previously said restaurants would be allowed to make surcharges, says they must be disclosed in advertising, which, presumably includes menus. 

However, the California Restaurant Association, is ready to fight back, saying that the written law only applies to advertisements because courts have ruled that “advertisements” for goods and services do not include menus.

In Walnut Creek, many people dining out had essentially the same opinion. “Yeah, it needs to be in the price of the food. It might help somebody decide on a menu item,” said Susan Bomba,

If this bundling happens, don’t expect the price of dining to decline. In fact, expect them to rise sharply. 

“Seeing the fee, we know about it and, I guess, if you eat somewhere long enough and you see those prices raised, you know that’s where those fees went,” said Dana Barry.

In fact, many folks think tipping, fees and surcharges are way out of control now. 

“I absolutely agree with that. Like I said, I’ve been to restaurants before and put a nice tip down and then realized later, the tip was included or something else,” said Bob Kennedy. 

“They shouldn’t be tipping on those fees,” said Dana Barry. “Now, for a carry-out, you’re expected to tip. That was never the case. I didn’t mind it during Covid, but now we’re back to something normal, we’re still expected to tip for carry-out food,” said Bomba.

Restaurant owners say they need clarity and specific answers soon, given that these rules take effect in just 60 days.
 

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About the Author
Yosi Yahoudai is a founder and the managing partner of J&Y. His practice is comprised primarily of cases involving automobile and motorcycle accidents, but he also represents people in premises liability lawsuits, including suits alleging dangerous conditions of public property, third-party criminal conduct, and intentional torts. He also has expertise in cases involving product defects, dog bites, elder abuse, and sexual assault. He earned his Bachelor of Arts from the University of California and is admitted to practice in all California State Courts, and the United States District Court for the Southern District of California. If you have any questions about this article, you can contact Yosi by clicking here.

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