“DC AG Announces Guidance on Deceptive Restaurant Fees”

photo by kristenstake

Thanks to M. for sending: “In my opinion, the guidance still permits a lot of complicated/confusing restaurant fee practices.”

From the office of the Attorney General for the District of Columbia:

“You have dinner at a local DC restaurant with your family. You plan to pay the price listed on the menu, sales tax, and a tip. But when your bill comes at the end of the meal, there’s a vague 20% fee added on that you didn’t expect. How do you know if the fee is going to service workers? Are restaurants allowed to charge fees without telling you?

Many District consumers have raised questions about fees and surcharges that restaurants charge to diners, including whether those fees are allowed and what they can be used for. This consumer alert is intended to provide the public with information about what the law allows and prohibits. These questions and answers are for illustrative purposes and should not be considered as legal opinions.
Are there rules against deceptive restaurant fees?

Yes. The District’s Consumer Protection Procedures Act grants District consumers the right to complete, accurate, and timely information whenever they purchase goods or services–including when they place orders at restaurants. That means that while restaurants are allowed to charge fees, they are not allowed to hide them, obscure them in fine print, or only disclose them after you have already ordered. And restaurants must also inform consumers why the fees are being charged.
What types of fees are legal?

To comply with these laws, restaurants should:

Clearly and prominently disclose fees at the beginning of the ordering process. This must include the type and amount of fee. For example: Servers could tell you about a fee verbally, or it could be disclosed in bold print on the menu.
Accurately describe the reason for the fee, either by naming the fee clearly (like: “worker health insurance fee”) or explaining how it is used.
Use any fees exclusively for the purposes disclosed. For example, “service fees” must go fully and directly to service workers, unless other uses are prominently disclosed.

What types of fees are illegal?

Restaurants may violate the District’s consumer laws if they:

Bury fee information in fine print on a menu.
Fail to disclose the amount or percentage of a fee until the bill is given to the diner at the end of a meal.
Use fees collected from diners for purposes contrary to the purposes disclosed.
Use ambiguous or misleading language that fails to fully convey to a diner how a fee will be used (for example, charging an ambiguous “restaurant recovery” fee without explaining what the fee will assist in recovering).

These rules apply both when sales are made in person and when they are made through an online platform.
Are there consequences for violating the law?

Yes. OAG is the primary enforcer of the District’s consumer protection laws. If our office finds that a business has violated the law by failing to adequately disclose or describe fees charged to diners, we could seek refunds for consumers, penalties, and changes to the restaurant’s practices.
How can I alert OAG about potential violations?

You can submit a consumer complaint by:

• Filling out our online complaint form
• Calling (202) 442-9828; or
• Emailing [email protected]  ”