With Arizona businesses starting the reopening process, residents are eager for life to return back to normal. However, customers might be in for a surprise about that new normal and how it could impact the prices for goods and services.
New story rumblings from around the country as states are starting to open have reported customers complaining about restaurants adding an extra fee to the bill. It is being called a COVID-19 surcharge.
The justifications from the eateries say they are charging the new fee to help make up for the rising cost of food and operating costs. The restaurant owners are experiencing a noticeable price increase on meat, seafood and vegetables from their local supplier.
It has been reported that many restaurants across the country have struggled to keep menu prices low as the cost of food quickly rises. To help manage costs during the ongoing coronavirus pandemic, the restaurant recently implemented a “COVID-19 surcharge.”
As restaurants across the nation grapple with rising food prices and other new operating costs, diners across the country should be prepared for the possibility of seeing a COVID-19 surcharge added to their receipts Gregory Frank, a partner at Frank LLP Class Action Litigators, said in a TODAY interview. According to the New York City-based attorney, these charges are legal.
“Generally, restaurants are allowed to structure their pricing however they like,” Frank said. “The important question is whether the restaurants are disclosing to consumers what they are paying before they pay it, so they can make their own informed choices.”
Restaurants typically handle cost fluctuations by altering menu prices, but the cost of reprinting menus can pose an additional burden to already struggling restaurants.
“For short term cost increases, like this crisis, it makes more economic sense for the restaurant to change their point of sale system to add a fee. Doing it this way can also make the customer more comfortable paying the fee knowing that it is temporary and related to the circumstance,” he continued. “It also makes it more likely they will lower the prices again after the crisis as a ‘COVID-19 fee’ would certainly look suspect after the crisis.”
In Arizona’s economy, hotels have added on resort fees to cover costs of internet bills and fitness center maintenance. Restaurants have already added a surcharge to make up for minimum wage increases. Will Arizona Valley business add the new ‘COVID-19 fee’?
As you can imagine, customers and people on social media have had very mixed reactions.
“I went in. I said, ‘Are you serious? You’re charging $6 extra just because of COVID,'” a salon customer recently said about her nail salon in Buckeye.
The business posted a sign when they reopened last week, saying they were adding a $6 fee due to an increase in supply costs.
Is The Tack On Fee Legal?
Are COVID surcharges the new standard? Can customers expect this to roll out across the state for good and services?
The Arizona Attorney General’s Office explained that each case is different. If the business has it posted or explains the fee to you before you receive any services, it can be legal. Customers need to be given the choice to pay the costs or not receive a service.
The AG’s Office does warn customers, if it shows up on a receipt, if you find a surcharge after the fact, and it wasn’t explained prior, it should be reported to their office.
Click here to contact the Arizona Attorney General’s office.