California Restaurant Association Issues Statement Regarding San Diego Restaurant Surcharge
Dear San Diego Restaurant Patrons,
Today, the San Diego City Attorney raised concerns about the manner in which surcharges were placed on customer receipts at some restaurants at the start of the new year. We appreciate her comments and respect her statements.
Because there has been some debate about surcharges, we think it’s critical that you know why some restaurants chose to adopt a surcharge. Many businesses all over California have been scrambling to find ways to adapt to the rising minimum wage. In a restaurant, labor costs often account for a very large portion of overall operating expenses, in an industry with remarkably low profit margins and high failure rates. This is why, when you hear about the minimum wage, you often hear about how it impacts restaurants.
To adapt to wage increases, restaurants around the state have either raised menu prices, reduced employees’ hours, reduced their own hours of operation, or adopted a surcharge or, in some cases, eliminated tipping and are now using a service charge. San Diego is not alone in this challenge and restaurants are not the first business to use a surcharge — many hotels and transportation providers also use a surcharge.
Whatever avenue each business chooses as a way to survive into the coming years, restaurants in San Diego and in every city want to be around for a long time to come.