Today Bauer Pants broaches the subject of San Francisco's very special restaurant employee health-care laws, raised last week by the Wall Street Journal. The WSJ piece uses One Market as an example of "one of at least 40 San Francisco restaurants identified by The Wall Street Journal that tell customers they are charging extra in the name of health-care benefits, but which end up spending less than a third of what they allocate." Wayfare Tavern and Café Flore are among the other restaurant examples cited. Bauer does a follow up interview with One Market owner Michael Deller, who says the semantics used at the bottom of his restaurant's checks doesn't pretend to give all the money directly to employee healthcare, and that the surcharge is also intended to cover all the extra costs of doing business in San Francisco: employment tax, $9.92/hour minimum wage, and 9 days paid sick leave, not to mention higher-than-average rent. He adds, "the restaurant workforce is made up of younger employees, so many forgo the private insurance." Restaurants are legally allowed to pocket any amount of the surcharge that's not used at the end of the year.
Here's what an anonymous employee at Wayfare Tavern has to say about all this:
We have been given strict instruction on how to respond to guests who question our policy of the HealthySF surcharge attached to every check. Basically, we are to tell our guests that we are simply complying with the law that was voted on and passed overwhelmingly by SF residents. Of course, management did not inform us that close to $100,000 of that money from last year alone was simply never used by employees, and therefore kept by the restaurant to do with, presumably, as they please...While it may not be illegal according to the letter of the law for them to keep the HealthySF surcharge money, it is certainly unethical. And, by and large, fairly standard practice for the management and owners of Wayfare Tavern...If the Salvation Army was discovered to be using their donated money to pay bonuses to their top executives and to pay for their weekly dinners at 4-star restaurants instead of providing clothing and shelter to the less fortunate, people would be picketing in the streets. Why is this any different? A millionaire TV personality opens a high-profile restaurant in the Financial District, tells his customers that he is charging them 3.5% to help offset the cost of providing health insurance to his employees, and somehow manages to pocket $100K out of the deal?! Why aren't people losing their mind over this? Like I said, don't take my word for it...look into it for yourself. It's robbery, plain and simple."
So why aren't employees using the money from the surcharge? Is it really, as Deller asserts, because they're young? Your thoughts, in the comments.
· Menu Surcharge Can Be Misleading [WSJ]
· Are San Francisco restaurants really pocketing the 3-4 percent surcharges as the Wall Street Journal claims? [ISSF]