Restaurants add surcharge to patrons’ tabs to help offset employee health care costs

It may not be happening at your favorite eatery, but some restaurants are adding a surcharge to patrons’ bills to help pay for the business’ employee’s health care coverage.

And it isn’t a new move.

Two restaurants in Austin, Texas, are among the restaurants that added a health care fee to their bills.

Foreign & Domestic in North Austin added a 3% charge to customers’ bills that will be used exclusively for employee health insurance, KVUE reported. Owners say the added charge is listed on both the menu and the receipt and can be removed at the customer’s request.

It was added on after restaurant owners started paying for health insurance for full-time employees, KVUE reported.

Another Austin restaurant, Hoover’s Cooking, adds its own extra charge, a flat, not optional, $1, calling it a Community Value Contribution and which goes for employee paid time offaccording to KVUE.

The surcharges are not exclusive to Austin, nor are they new. Some restaurants in Chicago started adding the extra charge last year, The Chicago Tribune reported in December.

Fat Rice in Chicago’s Logan Square added a 4% charge for employee health insurance and to give kitchen staff a raise, calling it a hospitality provision fee, the newspaper reported.

The newspaper also reported that the charge is common in bigger cities like Los Angeles and San Francisco.

A handful of Minneapolis restaurants also started tacking on the fee last year. Travail Kitchen and Amusements and The Pig Ate My Pizza, both of which are owned by the Travail Collective, both charged a 3% fee in 2018, WFMY reported.

Another group, The Bartmann Group, which owns nine restaurants in the area, also add a 3% charge that helps owners cover 70% of employee insurance costs, WFMY reported.


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