Restaurant customer says she was charged 5% ‘employee health’ fee, causing outcry

A woman’s viral video about a surprise fee on her restaurant bill has ignited a debate on social media about whether or not customers should bear the financial burden of the staff's health care.

On Jan. 10, TikTok user @ashnichole_xo, also known as Ashley Nichole, shared a story about a recent trip she made to a restaurant she frequents in Southern California.

While paying a bill at Osteria La Buca, an Italian restaurant in Sherman Oaks, California, Nichole noticed a charge on her restaurant bill that she didn’t recognize.

“The weirdest thing just happened to me,” Nichole says in her TikTok, which has garnered nearly a million views. She explains that during a rainy day in Los Angeles, she decided to meet a friend for a meal.

“We go to one of my favorite restaurants, this is Osteria La Buca,” she says, adding that she's been there multiple times. “We enjoy our meal, we get the check, we pay for our check, and as we are, like, signing the tip and stuff, we notice something.”

The video then cuts to a photo of her receipt, showing that Nichole and her friend dined on short rib ravioli, steak and more.

“If you notice down here towards the bottom, there is a $4.75 charge for employee health. Do you see that?” she asks her audience. “A 5% charge for employee health.”

“Immediate thought is: ‘What is employee health? What does that mean?’” she says. After running through a couple of conjectures with her friend at the table before getting ready to go, she decides to ask the restaurant what the charge entails.

“As we’re walking out, I go up to the hostess and I’m like, 'Hey, quick question, just curious,’” Nichole says, adding that she directed the hostesses' attention toward the 5% charge for the total amount of the bill. (At first, Nichole thought the restaurant charged them $5 each but has since corrected herself in a follow-up video.)

“And she goes, ‘Oh, that’s our health care,’” she says before pausing to give a quizzical stare into the camera. “And my reaction was, ‘Your health? Your health care?’ and she goes, ‘Yes, our health care.’”

Nichole says she has never heard of a charge like this before and asks her followers whether or not they have experienced charges like these at other restaurants.

“I had to find out: Is that normal? Have I been living under a rock and this is a normal thing or is this weird? Because I’ve never experienced this before and this feels weird. But maybe this is normal elsewhere. Let me know because I’ve never seen this before, ever.”

TODAY.com reached out to both Nichole and Osteria La Buca; neither responded to a request for comment.

The comments section of Nichole’s video shows the spectrum of opinions on the idea of an "employee health" surcharge, with comments ranging from outrage to disbelief.

“Wait! What? How is it now a customers responsibility to [pay] for their healthcare,” wrote one user on TikTok.

“If I’m paying for their healthcare, I’m not leaving a tip!” commented another user. “That would be like tipping my child for a service! If I’m paying your healthcare we family!”

“I’m sorry but I’m not paying for this. Just tax and tip,” wrote another person. “Health care should be cover [sic] by employer. These fees are getting out of hand.”

“If I’m paying for someone’s health, Can I now claim them as a dependent on my taxes right?!?” another person commented with a cry-laughing emoji.

Though most of the comments under Nichole’s video lambast the surcharge, there are some who, if they don’t support it outright, appreciate the transparency of the restaurant.

“Some small businesses around Atlanta do this!” commented one TikTok user. “It allows their workers to get healthcare for themselves and their family and sick leave.”

“The cost could be added to your menu items and you’d never know or care,” pointed out another commenter.

When did these restaurant surcharges start?

According to a New York Times article from 2020, these types of surcharges started popping up in 2008, when an ordinance passed in San Francisco required businesses with more than 20 employees to set aside money for health care. The federal Affordable Care Act, which came two years later, only requires this of employers with 50 or more employees, which often leaves out smaller businesses, like restaurants.

According to a 2022 survey by the U.S. Bureau of Labor Statistics, only 30% of private industry workers in "accommodations and food services" have access to employer-sponsored health care.

In recent years, instead of being folded into menu prices with customers none the wiser, these fees sometimes have been appearing transparently on receipts as a “4% surcharge” to combat inflation or “COVID-19 surcharges.” So, there is still plenty of confusion over these fees, but some business owners have been trying to explain.

“The past two years have been difficult in the hospitality business,” Troy Reding, president of Ally Restaurants in Minnesota, told TODAY.com in July 2022 regarding a “wellness fee” he instituted at his eateries in 2019.

Reding’s “wellness fee” is a 3% surcharge on customers' bills that he puts toward his employees' insurance premiums, paid time off, mental health access and IRA contributions. According to Reding, he’s faced pushback from some customers, but not all.

“I think when you use a fee for a specific reason and it is to the benefit of your employees, that’s the differentiator,” he said.

This article was originally published on TODAY.com