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Reports of restaurants adding a “COVID surcharge” have become widespread during the pandemic. In recent months, cities and states across the nation have implemented a number of measures designed to help struggling restaurants adapt to the new normal. These include allowing restaurants to implement a “surcharge,” as well as capping fees that third-party delivery services can charge restaurants. However, while “surcharges” may be more benign than direct price increases, a recent California price gouging lawsuit demonstrates that restaurants still need to be vigilant in their compliance with state price gouging laws.
Thursday, December 17, 2020
Reports of restaurants adding a “COVID surcharge” have become widespread during the pandemic. In recent months, cities and states across the nation have implemented a number of measures designed to help struggling restaurants adapt to the new normal. These include allowing restaurants to implement a “surcharge,” as well as capping fees that third-party delivery services can charge restaurants. However, while “surcharges” may be more benign than direct price increases, a recent California price gouging lawsuit demonstrates that restaurants still need to be vigilant in their compliance with state price gouging laws.
In an effort to help struggling restaurants, Cleveland has become the latest city to implement a cap on the amount of fees that third-party food delivery services may charge restaurants. The limitation, passed on December 15, caps third-party delivery fees at 15% of the order. Similarly, Chicago implemented a ban in Nove