WASHINGTON — Get ready for even more of those mandatory service charges tacked onto your bill if you plan on eating at a D.C. restaurant in the near future. New research is revealing dire new projections about the fallout of D.C.’s new tipped wage initiative.
“So, they're saying, we either need to adapt our menu prices or we need to add these fees,” said Rebekah Paxton, research director at the Employment Policies Institute, a non-profit research group studying public policy initiatives surrounding employment growth in Washington, D.C.
“And I think we're already seeing that.”
EPI’s new survey on the “Impact of Initiative 82” found:
- 70% of D.C. restaurants said they plan to introduce automatic service charges to customers' bills.
- 46% said they would introduce other automatic fees for customers such as a "Fair Wage" fee.
“We know that this is an industry that operates on super thin profit margins,” Paxton said. “So restaurants are saying, you know, we need a little give and take here because we want to keep our staff we want to continue to serve our customers, but we can't afford these increases.”
In March, WUSA9 investigated the spread of restaurant fees to determine whether it was a “wellness fee” a “restaurant recovery charge” an “environmental surcharge” or simply a “supply increase fee.” Customers like Sarah Stella told WUSA9 they are fed up.
“You know, let's just like settle on, like one or two names,” Stella said with a laugh.
EPI’s online survey of 105 restaurant operators in D.C., many of them small businesses, predict the impact of Initiative 82 will go beyond extra surcharges on your bill.
46% of operators said they would open future locations in surrounding jurisdictions, such as Maryland or Virginia, not D.C. Others said they would have to reduce staff, raise prices, or close locations all together.
“So, diners might not be able to go to some of their favorite restaurants,” Paxton said. “They also may see a difference in service.”
Paxton said that could mean less servers and more use of technology, like ordering from an iPad or filling their own water a little more than customers are used to.
In March, DC Attorney General Brian Schwalb issued a consumer alert warning letting residents know that restaurants in the District are barred from charging deceptive, or hidden fees.
Anybody who feels that they were surprised or misled by a fee on their bill should contact the Attorney General’s office and file a complaint.