16 Aug 24th–Aug 30th, 2023 phoenixnewtimes.com phoenix new Times | music | cafe | film | culTuRe | NighT+Day | feaTuRe | NeWs | OPiNiON | feeDBacK | cONTeNTs | country. Steve Chucri, president and CEO of the Arizona Restaurant Association, estimates that fewer than 5% of restau- rants in the state employ them, but he says that number is growing. The National Restaurant Association esti- mates that 15% of restaurants nationwide now charge the fees. Should diners expect service fees to take hold in the Valley? It depends on who you ask. While most customers and experts share their displeasure with the added costs, restaurant and bar owners say the fees are their best option to address ongoing challenges. One thing both sides can agree on is the need for service fees to be advertised more openly. Decoding dining fees When it comes to decoding added fees, it’s important to note they are not tips. Automatic tipping fees, which are commonplace in Europe, have had fits and starts in gaining traction in the U.S., but have never taken hold as the norm. Those generally range from 18% to 22% and are most common when dining with a large group or hosting a private event, at which time no additional gratuity is expected. Other fees, which can be called service fees, service charges or employee benefit fees, generally hover between 3.5% to 5%. They’re not considered a tip, so these dollars flow to restaurant owners. “That gives them the ability to do whatever the hell they want with that money,” says Tracy Miller, an employ- ment law attorney with Ogletree Deakins in Scottsdale. That can mean covering the costs of doing business, such as paying credit card processing fees, increasing employees’ hourly pay or providing employee benefits or support. The classifications are general and, as a result, can be confusing to diners and murky for employees. When fees become fraud Maple & Ash and Etta settled for $20,000 with the Arizona Attorney General’s Office in April for failing to properly disclose a 3.5% charge to diners. The charges appeared on customer bills as “Emp Benefit” — or employee benefits, according to a lawsuit Attorney General Kris Mayes filed against the two restaurants. The charge was only disclosed on the restau- rant’s “About Us” page of its website or on the reservation checkout page, according to the lawsuit, and not on menus. Those attempts at disclosure, the attorney general’s office says, were not adequate and amounted to consumer fraud. “Defendants created a separate charge that appeared mandatory and allowed defendants to advertise lower menu prices while knowing they would charge higher prices on the final bill,” according to the lawsuit. “Defendants then concealed, suppressed or omitted material informa- tion about that charge on the menu, over the phone and on their websites.” Once sister restaurants of the same Chicago-based hospitality group, Etta and Maple & Ash have since split. Etta’s new management has done away with the fee. Maple & Ash continues to charge the fee, but it is now disclosed on the menu. “The public deserves transparency when dining out, and that includes knowing the total cost of meals before ordering,” Mayes says in a press release. “This settlement sends a clear message to restaurants that they must disclose all add-on charges on their menus, so customers can make informed decisions.” Finding fees To avoid confusion, the Barter & Shake Cocktail Entertainment team — which runs the immersive bars Platform 18, Grey Hen Rx and UnderTow in Phoenix and Gilbert — puts its 4% staff benefit fee out for all to see. That starts with including it on online reservations pages, as 88% of guests book their experience in advance, according to Mat Snapp, Barter & Shake’s executive vice president of operations. “A lot of the noise is that people think that employers and businesses are trying to be super shady. I feel proud to say we’re doing our best to be the opposite,” Mat Snapp is Barter & Shake’s executive vice president of operations. (Photo by Barter & Shake) Hidden Fees from p 15 >> p 18
