The service sector, which has been hit hard by the outbreak, has been forced to come up with novel ways of trying to make up for the huge losses as states reactivate their economic plans.
Las Vegas casino boss to send free one way ticket business, never send outside the Michelin restaurant to send the take-away, recently some American restaurants, beauty salon, even dental clinic began to impose “coronavirus surcharge”, a Chicago restaurant adds cost as much as billing rate of 26%, caused widespread controversy.
Supply chain disruptions have pushed up some food costs to their highest level in 46 years, creating a major headache for some struggling restaurants.
Many restaurants, already struggling with thin profit margins and low cash reserves, are reopening after weeks of closure, facing increasingly unaffordable costs and revenue ratios.
Many service companies are required by policy to ensure the safety of their workers and customers, again pushing up operating costs.
These factors are the reason why some restaurants, beauty parlors and even dental clinics around the country levy a “covid-19 Surcharge” on their bills.
A photo of the receipt at Kiko Japanese steakhouse & sushi restaurant in nishwara, Missouri
The coronavirus surcharge was initially controversial on twitter.
Earlier in May, diners at a Missouri restaurant were found to have added a $2.19 “coronavirus surcharge” to their receipts.
Many netizens expressed puzzlement, saying that in such an economic state, restaurants should not make customers pay for the extra costs they should bear.
The restaurant later posted an apology on twitter and said it had chosen to add a surcharge to diners’ bills as an easy way to compensate for higher food prices, rather than simply raising the price of its menu.
A similar surcharge was imposed at a Mexican restaurant in California for a modest $1, which the restaurant explained was due to the cost of coping with a shortage of meat and the cost of disinfecting it.
Harold’s Chicken Shack, a popular Fried Chicken restaurant in Chicago, caused a stir on social media when it charged a whopping 26 percent of its bill for the coronavirus.
The restaurant’s manager said the price of chicken, French fries and other ingredients had risen significantly since the reopening and that “the restaurant has no choice but to charge more”.
After an outcry from customers, the restaurant reduced the charge to 15 percent the next day.
Rising unemployment, security issues and limits on the number of customers merchants can serve have capped the capacity of restaurants and other service industries, with many restaurants operating at 25 to 50 percent of their stores and likely struggling to make ends meet.
It’s not just restaurants that are imposing a coronavirus surcharge. A dentist’s office in Florida is charging patients $10 to make an appointment for personal protective equipment.
There are similar charges in Texas, where some hair salons have begun charging $3 for hygiene to cover their losses after a few weeks out of business, or to cover the cost of protective equipment and cleaning supplies.
So, is it legal for businesses to charge customers a Surcharge for covid-19 surcharges?
According to Shawn Conroy, Georgia’s attorney-general, if companies do impose a Surcharge for covid-19 surcharges, it is legal in Georgia.
But one requirement is that stores post surcharges through social media or restaurant signs, and if they don’t do so to consumers in advance, they could be violating Georgia law.
Later, the Chicago city government also issued a statement saying that reasonable price increases due to the epidemic are acceptable.
However, if the price increase is not disclosed before the consumer purchases, or if the merchant claims that the additional fees are taxes, it may be considered deceptive and not in accordance with the law.
Similarly, Adam Itzkowitz, a lawyer at the law firm, said it was perfectly legal in Florida to impose a coronavirus surcharge, but it was important for companies to be as transparent as possible in enforcing the fees.