Public Holiday Surcharge? Is It Legal?

Dear Ozbargainers

I was just wondering, I was in Melbourne over their labour day weekend, and realised that all the 3 restaurants that I went to did not have any kind of surcharge.

In Brisbane I called up a restaurant to book on Easter Sunday, and I asked if there was a surcharge, and they said 'Yes of course 10%'.
Technically speaking Easter Sunday isn't even a holiday because it is Sunday anyway.
But yea most restaurants in Brisbane have public holiday surcharges and I was wondering what are the rules and regulations? I heard that it is actually illegal to have surcharge.

Please give me your thoughts.

(Also hate them minimum eftpos and credit card fees!! Ugh!)

Thanks guys.

Comments

  • -6

    illegal, but who to report?

  • As long as they publicly display and notify you of the surcharge then it is legal. I also hate it but as the consumer you can either agree or leave if you are informed. I was in a domino's once and Anzac day fell on the sunday with the public Holiday being on the monday. They charged 10% surcharge on both days, I complained but was told they could put up a sign that said 10% surcharge because its the owners birthday and it is legal, as long as you are informed. Ethical is another ballpark and as consumers we have a choice if we want them to have our business. I havent been back to Domino's since

    • -3

      Owner's Birthday???? No way………………….. that is a big load of bull, what criminals. That is ridiculous. Im sure that cannot be legal!

      But thanks for the input anyway, very interesting story

      • Then there'll be a owners dogs birthday, and a owners first home anniversary day

      • Businesses can charge whatever the hell they want to, for whatever reason they want to which does not impact anti-discrimination laws.

        You just have to be careful to stay within advertising regulations, so applying a surcharge without telling people about it first is not allowed.

        You could have a '(profanity) You' surcharge of 1000%, and so long as you sign it appropriately (and probably name it something more child friendly) it is perfectly legal.

    • displaying there is a % surcharge is illegal…. The menu must reflect the TRUE price

      http://www.accc.gov.au/media-release/misleading-menus-invite…

      • See the below comments, this was changed in 2013, your article was in 2010.

        • God the ACCC really needs to make up its mind then!!! Flip flopping again.

    • +7

      Went to a chinese restaurant on chinese new year on Thursday in the city, the cashier gave surprise surcharge , he said its chinese new year, there's 10% surcharge on the bill.

      I said we're not in china, and chinese new year here isn't a public holiday. Cashier said nothing back and gave a revised bill without the surcharge.

      WE'RE IN STRAYA!!!!

      • no idea why you were down-voted, so I corrected. Surcharge is do to penalty wages for staff - there is no excuse for non-public holiday.

        • maybe becoz most ozbargainers are chinese, including the founder. there's nothing against chinese here, just happened at chinese restaurant on chinese new year.

    • +1

      There are some businesses that should be avoided at all costs - Domino's is one of them!
      Shonky mob selling the worst pizzas in Australia

      • well that's what $5 pizza gets you

  • +2

    I didn't think it was illegal, but I refuse to go to places that charge a public holiday surcharge. On the whole the practice discourages me from going out on public holidays.

    CC surcharges piss me off too and are often only noticed once sitting down (or in some cases, only when it comes to paying the bill). At least this is usually 1-3% so not as bad as some of the public holiday surcharges which can be up to 15%.

    • +2

      Yea tell me about it, especially I just don't understand how big places have surcharge. For example, I stayed at Shangrila Sydney 2 years ago, and they said there is a 1.5% surcharge with credit card. I got upset and refused to pay the surcharge so ended up going to ATM getting like more than a grand out and paying by cash….

      It is just ridiculous……….
      Yea I normally don't go out on public holidays coz I hate these surcharges, but this time family is coming from overseas so I have no choice. but yea I wonder why Melbourne doesnnt have many places that have surcharges

      • Did you ask for a discount that you paid cash?

        All major chains i think make a millions because the credit card fee is included in the price.

        mixo

        • No I didn't ask for a discount. Maybe I should have haha.
          Yea… I mean especially big companies should definitely not charge surcharge.., I really do not understand.

        • +1

          Wasn't the discount the 1.5% less he paid by using cash?

        • +10

          Actually the jokes on the hotel. The more cash they handle the higher the Armaguard rate, plus it increases their insurance.

          Not to mention the staff time that is taken counting the cash around 3 to 4 times. Pity you didnt have it in $10 notes that would have cost them more.

        • Haha yea I should have done that! Pity the ATM doesn't give out $10 or $5 notes haha

      • +1

        I agree about not paying the cc surcharge, but you should have paid via EFTPOS rather than going to an ATM.

  • +10

    firstworldproblems

    Staff are usually paid more to work public holidays.
    Banks charge merchants for credit card facilities.

    In WA there are a lot of vacant shops, a lot of buildings for lease. It's tough for small businesses.

    • -4

      Yes, but it is that much busier on public holidays. Therefore I am sure owners would still make more money than normal weekdays.
      I mean people who work Sundays get paid more, but there is not a surcharge on Sundays.

      • +2

        It must be very different in Western Australia.
        A lot of the shops don't even open on the Sunday/Public holidays and these are shops in major shopping centres.

        You are obviously aware that these fees exist, it's now a part of life.

        You should speak to some business owners, you might be shocked.
        Being busy doesn't always equate to making more profit. (Increased wages)

        Wages is a killer in Australia,

        • Very good point. well taken. but yea I can fully understand where you are coming from, and I am not saying surcharges are unfair, it is just that I believe it is not necessary and I am sure it just unconsciously bothering a lot of people. Maybe we just got to accept it and live on.

        • +1

          Wages is a killer in Australia

          Do you really think so? I think the cost of living is the killer.

          Wages at the mid to lower end have failed to keep up with inflation for years now, while prices for many things that people actually need to buy have increased at a much higher rate.

        • @pjetson:

          inflation hasn't been that bad.

          The way its measured is just bad.

          If we were to look at it from a low income earner point of view it would be extremely high

          Electrity would be increasing some people cost of living by 10-20%

        • +1

          @pjetson:
          I think so. The main reason eating out is expensive in Australia is the cost of staff. In the US food is cheap, but staff are dependent on tips to earn a decent wage.

        • +1

          Up until recently WA didn't have weekend or night time trading!! Its a different place over there.

        • @SlickMick:

          And the service (in the US) is (profanity) fantastic as a result.

        • -1

          @Level380:

          Correction, we have always had weekend trading.
          It has lately been extended to all the shopping centres.
          However 1/2 the shops still don't trade on these Sundays.

          We've also had late night trading, the govt set some changes
          to allow more shops to trade longer. These shops are usually dead adter
          about 6.00pm anyway.

        • +1

          @pjetson:

          Housing prices is really the killer. The average income earner cannot possibly afford to rent or service a mortgage while actually living.

        • @massafiri:
          did you get bored talking about restaurant surcharges? subtle attempt at change of subject much

        • @SlickMick: It got me off the track.

          The average income earner cannot possibly afford to rent or service a mortgage while actually living.

          Only Zombies can afford surcharges ?

    • Depending on the type of job, wages can be 1.5 or 2 times the base rate on public holidays (eg at Myer many years ago I was paid 2.5 x base rate for working on Boxing Day). These businesses are just passing on a portion of these increased costs.

  • It can suck, but it's not illegal as long as they're upfront about it. There was a bit of yes/no with some changes to the law a few year's back, but i believe cafes and restaurants can now add surcharges for anything they like.

    If they told you about it right at the end then it would be illegal.

    • Fair enough, but sometimes they have it in small writing that is barely noticeable and so on~ oh well~

      • That might be a different issue. They're exempted from the requirement to display the final price next to every item (which stopped them adding surcharges) but they still need to be very clear when a surcharge does apply.

        The problem came about because all the cafes and restaurants needed to have separate menus for days with increased prices. They complained that it would be too hard to comply and got and exemption.

    • -4

      Its illegal if they display there is a % surcharge…. The menu must reflect the TRUE price being charged, so on public holidays they need to have a different menu with the prices adjusted.

      http://www.accc.gov.au/media-release/misleading-menus-invite…

      • Misleading menus invite Infringement notices
        1 July 2010

        it has changed since then

  • Unless you expect workers to earn the same as a normal day, whats wrong with public holiday surcharges, would you rather that all stores shut down during the public holidays?

    I've always been surprised its only 10%, I would of thought 20%-25% would of covered employess cost

    • -1

      Yes, but as I said on the top post, it is that much busier on public holidays, and therefore even without surcharge, they would make more money than normal weekdays. And also Sundays there are no surcharge, when the staff usually get paid more on Sundays. I can understand where you are coming from, and I am not saying surcharges are unfair, it is just that I believe it is not necessary.

      • +1

        Enough to cover the extra wages? If that were the case there would be a lot more stores open on public holidays and they wouldnt be constantly whinging for the removal of penalty rates.

        At the same time not everyone hangs around during oublic holidays

        • yea, but maybe surcharge is the reason not as many people are around? I know it is not a great deal 10%, but it is just a mental thing in my head saying 'why do I have to pay 10% for the same food just because it is a public holiday?'

          I am sure if they did not have surcharge, there would be more people eating out on public holidays and one more table of paying customers could probably cover the whole increased wages in public holidays.

        • @vcmelo15:

          yes its you not everyone else.

          10% is discouraging hordes of people from going out…

        • ok maybe it is just me~….

        • +1

          @vcmelo15: You've forgotten that if more people eat out of public holidays, either more staff are required, leading to extra costs, or the quality of the service suffers, which hurts the restaurant in the long run. That and the restaurant might run out of space, leading to long queues.

        • Yes, more people eating out may mean more staff, but in turn they are receive much more income that will fully cover the extra staff costs. If it does not, how can restaurant make money? Unless you are running the restaurant in a poor and inefficient manner, normally more people dining means more profit for the owner. Im sure that is the point of business to attract as much customers as possible.

        • +1

          @vcmelo15: Given that many restaurants choose to not open on public holidays, what you're saying is simply not the case. There's much more to running a restaurant than "more customers = more profits" and you're simply missing the whole picture.

        • @Baghern: me as well. 10 percent surcharge and I am going out of the door.

        • +1

          @vcmelo15: I think that's your opinion rather than a fact. It also ignores price elasticity of demand and capacity of the business (e.g. if the business is full on a weekend anyway, then they're not going to make more than usual but will incur the higher wages costs).

          If they didn't charge the 10% but more people came, that doesn't automatically mean they'll make more profit. Depends on elasticity.

          Frankly, it's about willingness to pay. Most people accept that you might have to pay a public holiday surcharge and will pay it anyway. So many business owners make that assessment and decide they're better off charging it. Either all these business owners trying to run profitable businesses have rocks for brains and you've come up with an amazing insight about how pricing/profitability in the restaurant industry works, or maybe they've got a bit of experience with setting pricing and the impact it has on their businesses.

      • +8

        I don't think you understand how much public holidays cost employers. Employees get double time and a half on public holidays. Lets say a small bistro rotates 7 people at min wage, from 6am to 10pm. They would ordinarily receive 16.87 an hour; the penalty rates for a public holiday bump that minimum to $42.16 an hour.

        If it was a a weekday (weekends are different), the wages for everyone in the cafe would be about $1889 — for the whole day.

        On a public holiday, the wages for staff get bumped up to $4720 for seven people working all day (they wouldn't work all day, but hypotheticals).

        Restaurants have a finite amount of seating/space— which means they have a upper limit on how much money they can conceivably make an hour depending on how big the establishment is, how long people are taking to bring in new customers, how long people linger, etc, and they would need to make 5000 dollars— just to break even on employee wages— this is not including the cost of rent, food, bills, etc.

        Also, it's not a given that it's much busier on public holidays. You can't predict these things, and you may have a dud day, which happens and is terible for the establishment.

        Given all of the above, 10% is really not that much, and it's definitely not a greedy money grubbing exercise, as it is still a lot less than the penalty rate. Moreover, it's like two cups of coffee on a 100 dollar meal — and if you split the bill you're paying even less.

        If you're going to argue that penalty rates are too high— perhaps, but keep in mind, waitstaff, et al, want to enjoy a lovely public holiday too, go relax at a cafe, spend time at the beach or with their families who have the day off, etc.

        You kind of remind me of this lady I saw at Woolworths last Friday night at 8. she was livid they had like three employees on, and she had to bag her own groceries. She went on some tirade, about how staff are lazy and they should hire some employees and why were they restocking things when she was trying to shop and stuff was blocking the aisle— and she wasn't going to self-checkout because this and that and that was their job. Yeah, I get it. But nobody wants to work til 9pm Friday night in a Woolworths These people don't want to be there serving literally three customers in the store at that time.

        The thing is, if you want convenience, if you want things your way, if you want the shops and restaurants and such to be open at all hours and especially at a time that is convenient to you, public holidays— it comes at a cost, either in a surchage or a decrease in service or employees. If it bothers you so much, and if you don't want to pay the surcharge, you don't have to add to the throngs of people going out that day.

        • What about restaurants that charge surcharge on food? Eg: Dominoes charge 2.5% surcharge on prawns and chicken pizza

      • If it's busier, you need more staff which in turn means more wages.
        Edit:just realised a million people articulated that much better than me

    • Public Holidays are gazetted well in advance, you run your business and set your pricing after factoring many things including wages, I cannot believe this many businesses haven't factored in the few public holidays and their wages when setting their pricing to ensure they remain profitable throughout the year.

      • or they could set lower prices and be more competitive the rest of the year and close during the public holidays…

      • It was good while all the cash paying customers were subsidising my credit card fees, shame that's over. But I wouldn't be keen on paying extra all year round just so you don't get a surcharge on public holidays.

  • +3

    The businesses are also using casual staff which equals higher pay rates as well. A lot of people forget that the business owner is
    paying the PAYG for the employees, paying the superannuation, paying the workers comp (which is calculated by number of employees).

    vcmelo15, next time you are in the coffee shop with your family on a public holiday , make sure you tip the waitress who is probably saving for uni fees and giving up her Sunday so you can have a nice cappuccino.

    • -1

      Yes, but PAYG for employees and superannuation and workers comp is paid anyway even on every other day. And who was not going through tough times like paying for uni fees etc. Look all I am saying is, if there was restaurant A and B and A has surcharges and B doesn't, even though I like A a little more, I would go to B. And I am sure there are others that would be similar thing. I think restaurants would get more busy if there wasn't any surcharge. As I said above, one or two more table of paying customers could probably cover the whole increased wages in public holidays.

      • +2

        one or two more table of paying customers could probably cover the whole increased wages in public holidays

        hehehe

        might want to stop right there…

        • +4

          vcmelo15 obviously thinks that the wages bill for a Sunday is an extra $50.00

          NFI

        • haha yea well you get the point, where I believe there would be more customers if there was no surcharge, but then again maybe not~

        • @vcmelo15:

          Wait did you infer you're a student?

          10% may effect, may effect some cost concious students…

          But most people even students(lazy) are pretty 'meh about it. Its generally when people aren't aware of a surcharge that they get angry.

    • +2

      She isn't giving up her sunday for my benefit to drink coffee. No one is forcing her against her will… She chooses to work that day knowing full well she will get paid $40+ an hour to pour milk in a cup!!

      • +3

        It was a hypothetical. She doesn't work there anymore as her shifts were reduced, she is now delivering pizzas.
        She receives more tips delivering pizzas. Uni fees are quite high and her family ain't rich, so she is forced to work weekends.

        • This could make a good Children's book haha..

  • +2

    I don't see the problem here. If anyone is unhappy about the surcharge they can choose to go somewhere else that doesn't have it. Or they can complain straight to management, if they get enough complaints from customers, maybe the owner will think twice about it. As far as I know, it's a perfectly legal practice.

    • Oh wow~~ thanks for those links.
      it must not be as strict~~

    • +3

      These are out of date now.

      • Oh dang, just read your comment. I need to get with the times.

  • +4

    It's legal, they were previously required to have the actual prices displayed including the surcharge rather than just saying +10% to all prices.
    In 2013 this changed and it is no longer be necessary to produce separate menus for weekends and public holidays when a surcharge may be applied.

    Restaurants and cafes will no longer have to:

    print and distribute a different menu for weekends and public holidays; or
    show two or more lists of prices on the same menu; or
    undertake changes to the blackboard menu.

    • And this is a Australia wide thing right?

      • I believe so, it's a Federal Gov. thing.

  • +1

    It used to be illegal, now it is fine for cafe's and the like. The surcharge must be displayed somewhere visible.

    http://www.comlaw.gov.au/Details/F2013L01387

    • Wow great find. This was exactly what I was looking for.
      So it seems like it is legal as long as they have it clearly written.

      I don't get this part fully;

      (6)The representation must be displayed at least as prominently as the most prominent display on the menu of the following:

                       (a)  the consideration for the supply of food or beverage;
      
                       (b)  a fee or surcharge relating to the supply of food or beverage.
      
      • I believe this means that the statement on the menu that there is a surcharge applicable can be no smaller than the size of the text that shows the price of items on the menu.

        • Oh size of the text~~ yea that makes sense.
          Thanks for the Pjetson~

      • I got slugged with a 10% surcharge at a f***ing pub on labour day. They told me AFTER I ordered my drink

  • +3

    You keep saying the surcharge is unnecessary, have you ever work/managed/owned a restaurant before?

    • Nope but my uncle runs a café and so I have been exposed to it.
      Well my purpose was to find out the legality in which the above post has answered very well, but yea I still do not think I will ever be fond of these surcharges.

    • +7

      I've run a retail business and I did not get to jack up the prices by 10% just because someone wanted to buy products on a public holiday. I factored in my expected wages for the year (including the public holidays and how many full time casual and part time employees I had) and maintained my margins accordingly. I see no reason the food industry cannot manage their business in the same way

      • +4

        Tl;dr Japius doesn't run a food business

        • Normal businesses pay their staff on a public holiday and the employee doesn't even have to come in!

        • TL:DR Japius runs his business this way, therefore everyone else should do things this way.

      • Retail is not the same as restaurant business.

        How many staff do you hire in a busy day? Maybe 2 at the register and 2 on the floor?

        In a restaurant, you need at least 4 waiters on the floor alone, then you got the kitchen staff.

        • +4

          On a public holiday I would have at least 8 on the floor plus 2 on register and a manager. All things to factor in when running a business. I am just saying a cafe can do the same, they know the staff and the costs well in advance its not like public holidays appear by surprise

  • Not only holiday surcharge, but many cafes in Sydney have a Sunday surcharge too.

    • Wow sunday surcharge…..

  • +3

    I used to work for a restaurant inside a RSL. We got paid extra for public holidays and the punters got charged extra (10%?) on their bill.
    Surely the people working (while the rest of us have the day to have with our friends and family)deserve some reward. Working on a public holiday is not the same as working during the week…. All people have choices, just some have more choices than others?

  • I saw on a Dominos leaflet that public holidays attract a surcharge of 10%. Didn't realise fast food does it too

  • They charge you surcharge cause they need to gain back from the extra that they pay their employees during public holidays.

  • +1

    From FWA, adult casual wage for hospitality (eg. waiter/waitress) is $21.69 per hour. Public holiday wage is $47.72. That's a difference of $26.03.

    Minimum shift is 4 hours. That's still $100 extra per staff member. I can not see it likely that that staff member will bring in an extra $100 just because it's a public holiday.

    10% extra is nothing, especially when you're talking about Dominos etc when the average purchase would be $15-$25.

    • Very good point there. is this more than 2 times?? That's ridiculous~

  • Meh, all restaurants flat out charge more for equivalent product every day of the year over in WA. Its most noticeable in the chain restaurants that sell identical things but it really is across the board.

    There doesn't seem to be any reason for this. Produce at super markets is a similar price. It would seem we've just been conditioned to pay more and there doesn't seem to be enough competition here to push prices down. Melbourne of all the capital cities seems to have the lowest restaurant prices. I always assumed it was because of the cafe/restaurant culture they have going and the increased competition it brings…

    • I'm from Melbourne and I think the prices at nice restaurants are too high. Imagine I lived in Perth!

      We eat out a 3-4 times a week, usually cheap to moderately priced restaurants, and expensive restaurants (expensive to me, i.e. $35-40 mains) about 5-6 times a year. Use to eat out more at expensive restaurants before kids.

      Some restaurants here in Melbourne have surcharges on public holidays and Sundays, I just avoid them (on those days) and eat elsewhere. Fortunately, they are the rare exception rather than the rule. As you said, many places to eat in Melbourne.

      I don't see why I have to pay a surcharge because they choose to open, it's called a cost doing business.

      • There are areas where businesses don't charge a surcharge… those area are what you call deadzone… as there are hardly any stores open.

        So yes its a cost of doing business… which many choose not to take on, as even with the 10% its not enough.

        Closed businessed are bad for the eonomy as a whole.

        Theres an intiative by the Liberals to remove penalty rates, to enable businesses to operate on weekends and public holidays. Its perfectly sensible from a business/economy point of view, it would boost out GDP by billions. But you try telling that to the workers whoa re screwed by it.

        • I disagree that all workers are screwed by it. Some more, most aren't.

          When I worked in retail in a past life as a casual worker, I didn't get paid extra for working on a public holiday. It was a job, I turned up, didn't get paid more or less. I was glad I had a job and was getting paid.

          But you are correct, it's bad for the economy.

          I don't see many places in Melbourne closed on weekends or PHs.

          But it may be a catch 22 for smaller cities, people are less likely to eat there if there is a surcharge. Restaurants know it may be quieter, so they place a surcharge. Maybe if there wasn't a surcharge, people (like me) will be more likely to go out and eat. If there is one, I'll just cook a steak at home, and eat out the following day :D

        • Exactly~

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