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January 24, 2013

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Legal Center Live: Restaurants typically must eat cost of overlooked charges

Question: A server forgot to charge some patrons for wine they ordered and drank. He called them to ask if he could charge their card and they said no.  Is the server responsible for paying the bill?

Answer: Alden J. Parker, an attorney with Weintraub and Tobin in Sacramento, offers these insights:

This situation is common in the restaurant industry and in other service sectors.

In a a fast-paced restaurant environment, an item can often not end up on a bill. Additionally, a customer can forget to pay for a billable item, refuse to pay or dispute a charge. In most situations, an operator doesn't want to alienate or hassle the customer to ask for additional charges to be levied against them for an honest mistake. This causes many employers to look to the employee to take responsibility for the financial loss.

In California, it is illegal to garnish an employee's wages to pay for these losses. If the employee made an innocent mistake in not charging for a bill item, the company has no recourse in claiming the loss.

However, if the company can prove that there was malicious intent in leaving items off of the bill, there could be some options for the employer to collect the loss.

In most instances, though, the employer must suffer the loss due to strict labor code statutes in the state.

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Legal Center Live is a video series answering commonly asked legal questions affecting California restaurant operators. The CRA Legal Center provides CRA members with access to attorneys across the state who specialize in issues affecting restaurant operators. To ask a question, contact helpline@calrest.org.