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The sanctity of Sunday surcharges

By Alexandra Craig - 30 September 2014 19

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Over the weekend I had Sunday brunch with my partner at a lovely new-ish establishment in Canberra. The food was delicious and reasonably priced, the service lovely and we didn’t have to wait long for a table. Perfect. When it was time to pay the bill, we were hit with a 10 per cent Sunday surcharge.

I don’t mind paying a surcharge. Sure, I might have had a little groan on the inside to myself about it but I’m actually okay with it. We have pretty good workplace relations laws in Australia which we should be incredibly thankful for and yes, if we work on a Sunday or a public holiday when everyone else gets the day off, we should get a little bonus for that. That seems fair enough, right? The café owner feels the need to put a surcharge on the days when they’re bound by law to pay their staff extra. But why is it only cafes and restaurants that apply this surcharge and do people actually cop it?

I can only imagine the outrage and backlash if other stores started whacking an extra 10 per cent on their prices on Sundays. People would go ballistic if they were purchasing a shirt or a pair of shoes from a fashion retailer and were hit with a surcharge at the cash register. If you were finalising your purchase of clothes or other goods and the retailer bumped the price up because it was a Sunday, would you pay it? Retail stores still need to pay their staff penalty rates, but they don’t put their prices up. Why is it only an exclusivity for the hospitality industry? I’d definitely avoid doing clothes shopping on days that attract penalty rates for staff if a surcharge was going to be imposed, but I don’t generally avoid restaurants or cafes that have a surcharge.

10 per cent seems to be your stock standard surcharge but I’ve seen 15 and even 20 per cent surcharges across the capital on Sundays. To me, 20 per cent is a little exorbitant and seems more like a tactic to make extra profit rather than making enough money to fund the penalty rates of employees. There is one café in Canberra – which I absolutely love – but they whack a 20 per cent surcharge on your bill on Sundays, so I don’t make a habit of going there unless it’s Monday-Saturday.

If you come across a restaurant or café that is applying a surcharge do you avoid it and find somewhere surcharge free, or do you suck it up and eat there anyway? If you pay the surcharge, would you stop at 10 per cent or would you happily pay 15 or 20 per cent?

What’s Your opinion?


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19 Responses to
The sanctity of Sunday surcharges
watto23 1:57 pm 01 Oct 14

Sundays are probably many cafes busiest days of the week. I’m pretty certain that majority of cafe owners don’t earn extravagant amounts of money and most rarely take time off. As long as you know their is a surcharge either by it being on the front of the menu in reasonable size print and also by the till if its a pay before you seat type place then you have the information to decide whether to eat there or not. I think extortionate “cakeage” fees are more of a rort.

Even getting rid of penalty rates won’t help much, just shift the issue elsewhere, like inability to hire people to work weekends and public holidays.

1967 1:03 pm 01 Oct 14

I have no problems with paying a surcharge on Sundays and Public Holidays.
It seems fair enough to me that if the manager / owner is paying his staff penalty rates then I, as the consumer and ultimatly the reason these people are working, should contribute.

However……

Some years ago, I ended up in a very heated argument with the manager of a fast food outlet and ended up leaving without my pizzas and garlic bread, vowing never to darken his doorstep again.

It was the Saturday after Good Friday, and a surcharge had been applied to my bill.
Being a wage earner myself I was well aware that Saturday was not, in fact, a public holiday.
I questioned the kid on the counter and he told me that was the status quo for Easter Saturday.
I then asked him if he was being paid penalty rates for the days work.
He didn’t know.
I asked to see the manager, and when I suggested to him that his employees should be getting penalty rates he actually laughed at me.
It all went down hill from there but I could see the staff thinking thias over as I left.

Sorry to go a little off topic, but I think it’s important.
Cheers.

Antagonist 10:58 am 01 Oct 14

dkNigs said :

If you’re hungry and the food looks good, are you really going to leave, go home, order food online and wait a few days? They’ve got it in the bag.

If I’m hungry and the food looks good, I am still going to get up and leave the minute I find out they have a Sunday surcharge. There will be somewhere else nearby (ideally within site of said eatery) where I can get a feed without being gauged for an extra 10%-20%. My feet WILL do the talking every time.

Postalgeek 10:57 am 01 Oct 14

Surcharge takes care of the tip.

neanderthalsis 9:06 am 01 Oct 14

Madam Cholet said :

Bosworth said :

are these surcharges legal?

I thought the menu had to state that there was a surcharge but that the menu prices actually had to include the surcharge rather than it being whacked on at the till which might take you by surprise. So in essence it had to be a special Sunday menu.

It was previously the case that cafes and restaurants could not apply a percentage based surcharge and had to either have a flat rate surcharge (eg. $5 Sunday loading per bill) or a different menu that showed the increased price per individual item. As per my previous comment, legislation was passed in June 2013 that made changes to federal competition law for hospitality businesses to charge a percentage based surcharge as opposed to having a different “weekend menu”. If you want to read more, google the Competition and Consumer Amendment Bill 2013, it is a riveting read.

dkNigs 11:52 pm 30 Sep 14

If I ask you to pay 10% more for a t-shirt as go to pay, you’ll go home and order it online for 20% less than the original price.

If you’re hungry and the food looks good, are you really going to leave, go home, order food online and wait a few days? They’ve got it in the bag.

Madam Cholet 7:30 pm 30 Sep 14

Bosworth said :

are these surcharges legal?

I thought the menu had to state that there was a surcharge but that the menu prices actually had to include the surcharge rather than it being whacked on at the till which might take you by surprise. So in essence it had to be a special Sunday menu.

Alexandra Craig 3:33 pm 30 Sep 14

neanderthalsis said :

Alexandra Craig said :

neanderthalsis said :

Yes, but what about the labour of someone in a retail store? Before I had a full-time job, I worked part-time in a fashion retail store. I got paid penalty rates on Sundays and a loading bonus on Saturdays. I think the product cost is irrelevant in this discussion, it’s only about what the staff cost – my point is, if it costs restaurants more to staff their establishment on a Sunday and they put their prices up or whack on a surcharge, why don’t retail stores do it? It costs them more to staff their store too.

Retail is less labour intensive, you don’t have someone in store to make your shirt for you, you just pick it up of the rack (some exceptions obviously…), therefore they can reduce non-essential staffing to a minimum and lower staffing costs. When you worked in retail trade, did the full complement of staff work on a Sunday or did they have a reduced staffing?

The store I worked in would only ever have a maximum of three people in it on a Saturday, usually two on a Sunday and two on a weekday. It was a really large store that was hugely popular though so we were run off our feet all day, we could have done with an extra two staff. I know the idea of being run off your feet in retail sounds stupid but we used to get giant lines at the register and fitting room, and people would leave A LOT of clothes to be re-hung and put away. It was also quite difficult to keep the store tidy with a small amount of staff. We’d also get about 9 boxes of new stock each day which is hugely consuming – unpacking, unfolding, hanging, remerchandising the wall and floor racks for the new styles to fit, then finally putting them up.

Genie 2:32 pm 30 Sep 14

I thought it was made illegal to charge a surchage on a Sunday or public holiday ?

If they wanted to increase their prices to cover the costs it had to be a separate menu. Was this rule over turned ??

neanderthalsis 2:08 pm 30 Sep 14

Bosworth said :

are these surcharges legal?

Previously the ACCC frowned upon percentage based surcharges instead allowing flat rate surcharges and a different “weekend menu” . However, legislation passed in the last week of the Rudd government changed competition law to allow hospitality businesses to apply a percentage based surcharge.

neanderthalsis 2:00 pm 30 Sep 14

Alexandra Craig said :

neanderthalsis said :

Yes, but what about the labour of someone in a retail store? Before I had a full-time job, I worked part-time in a fashion retail store. I got paid penalty rates on Sundays and a loading bonus on Saturdays. I think the product cost is irrelevant in this discussion, it’s only about what the staff cost – my point is, if it costs restaurants more to staff their establishment on a Sunday and they put their prices up or whack on a surcharge, why don’t retail stores do it? It costs them more to staff their store too.

Retail is less labour intensive, you don’t have someone in store to make your shirt for you, you just pick it up of the rack (some exceptions obviously…), therefore they can reduce non-essential staffing to a minimum and lower staffing costs. When you worked in retail trade, did the full complement of staff work on a Sunday or did they have a reduced staffing?

Generally you can run a boutique store with one and a third spotty teenagers on a Sunday while a cafe does not have that luxury. They still need a barista, short order cook, wait staff etc, often with greater staffing requirements than they would need for a quiet Tuesday because more people want to get out on a Sunday morning. You could never hope to run a Sunday brunch/lunch service on a reduced staff and keep up unless you didn’t have demand to start with.

Alexandra Craig 12:49 pm 30 Sep 14

neanderthalsis said :

The reason that reatil doesn’t pass on additional labour costs is that the production costs of a Bangladeshi made shirt don’t increase because it is Sunday in Canberra and the product mark up is sufficient to absorb increased labour costs for one day a week in an industry that is not particularly labour intensive. They can also scale down staffing to compensate or, in some cases expect a higher customer flow. Try finding a staff member over the age of 16 to answer your question on a Sunday in KMART, and you will understand…

Hospitality is a labour intensive industry, coffee and milk stay the same price, but the person behind the espresso machine becomes a lot more expensive hence higher costs on a Sunday of public holiday. The simple fact is that the labour costs for the person making your latte can be as much as double their usual rate, up to around $30 for an adult casual on a Sunday and over $50 for a public holiday instead of the award rate of $21 for a casual.

The average punter expects to be able to get a coffee and a vanilla slice on a Sunday morning, but they generally don’t understand the actual cost to a business in opening on a Sunday.

Yes, but what about the labour of someone in a retail store? Before I had a full-time job, I worked part-time in a fashion retail store. I got paid penalty rates on Sundays and a loading bonus on Saturdays. I think the product cost is irrelevant in this discussion, it’s only about what the staff cost – my point is, if it costs restaurants more to staff their establishment on a Sunday and they put their prices up or whack on a surcharge, why don’t retail stores do it? It costs them more to staff their store too.

arescarti42 12:39 pm 30 Sep 14

neanderthalsis said :

Hospitality is a labour intensive industry…

This was exactly my thought as well.

Stores also have the benefit of being able to move a lot of their labour intensive activities (restocking, cleaning, etc) to other days of the week, and keep a skeleton staff on weekends. Cafes can’t do that.

The places that don’t charge a weekend surcharge are making up for it somewhere else, probably through higher prices during the rest of the week.

So long as cafes make it clear that they have a weekend surcharge upfront, then I don’t see any problem with it.

neanderthalsis 12:03 pm 30 Sep 14

The reason that reatil doesn’t pass on additional labour costs is that the production costs of a Bangladeshi made shirt don’t increase because it is Sunday in Canberra and the product mark up is sufficient to absorb increased labour costs for one day a week in an industry that is not particularly labour intensive. They can also scale down staffing to compensate or, in some cases expect a higher customer flow. Try finding a staff member over the age of 16 to answer your question on a Sunday in KMART, and you will understand…

Hospitality is a labour intensive industry, coffee and milk stay the same price, but the person behind the espresso machine becomes a lot more expensive hence higher costs on a Sunday of public holiday. The simple fact is that the labour costs for the person making your latte can be as much as double their usual rate, up to around $30 for an adult casual on a Sunday and over $50 for a public holiday instead of the award rate of $21 for a casual.

The average punter expects to be able to get a coffee and a vanilla slice on a Sunday morning, but they generally don’t understand the actual cost to a business in opening on a Sunday.

Bosworth 11:51 am 30 Sep 14

are these surcharges legal?

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