Florida Dining Law: Transparency in Service Charges

Beginning July 1, diners in Florida may notice more clarity when checking their bills at restaurants. A new legislation requires restaurants to prominently disclose mandatory fees and service charges before patrons make their orders.

The law now extends beyond automatic tips, covering a range of obligatory charges referred to as ‘operations charges.’ These include service fees, credit card surcharges, delivery fees, and other mandatory charges attached to a customer’s bill, exempting taxes.

Restaurants must reveal the amount or percentage of these charges and explain their purpose on menus, websites, mobile ordering platforms, and any applicable written agreements. This information must also be presented on customers’ bills, as outlined in the legislation.

“Restaurants today are navigating rising costs and evolving customer expectations, particularly around tipping and service charges,” Ashley Chambers, communications director at the Florida Restaurant & Lodging Association, stated.

The law intends to offer diners clearer insight into expected payments beforehand.

Eric Douglas from BOL Hospitality Group, which has multiple South Florida eateries, emphasized the mutual benefits of transparency for both diners and restaurants.

“Anything that’s good for the customer is good for us,” Douglas noted. “We’re in the customer service business. We want to ensure transparency with any charges we might have.”

Douglas’ group plans to introduce an 18% service charge at one restaurant, directing all the proceeds to employees. He emphasized the need for clarity if a portion of a service charge is allocated for operational expenses.

“If I’m going to be charged a service charge, and it’s not going to be used 100% toward the staff, I think I deserve to know where it’s going,” Douglas asserted.

Automatic gratuities can also be beneficial for larger parties, ensuring servers are fairly compensated for the added coordination and effort those tables demand.

Vicki Parmelee, owner of Jumby Bay Island Grill in Jupiter, prefers incorporating costs directly into menu prices rather than tacking fees onto the bill at the meal’s end.

“We have always been straightforward with our guests regarding what they are paying for,” Parmelee stated.

She argued that diners shouldn’t have to decipher bills for extra fees and voiced concerns that the new law might lead some patrons to assume deception by restaurants.

“I think this new law will unfortunately confuse diners,” Parmelee said. “They may assume they have been ‘duped’ when dining out.”

Instead of applying service charges to manage rising expenses, Parmelee suggests restaurants should adjust menu prices to accurately mirror costs.

“If expenses have increased, the menu prices should accurately reflect 28–35% food and beverage cost, not an added service charge,” she noted.

Parmelee critiqued the practice of replacing conventional tipping with obligatory service charges, which she believes poses challenges for diners and staff.

“I would never adopt this fee structure,” Parmelee said, advocating for voluntary tipping earned by staff.

The law doesn’t forbid restaurants from employing mandatory service charges or automatic gratuities. However, it mandates that any imposed charges be clearly disclosed before customers place orders.