Morgan Tait

Morgan Tait is the NZ Herald's consumer affairs reporter.

Food establishments avoid holiday surcharges

Many owners compensate for extra staff costs by charging patrons slightly higher prices throughout the year

Dante's Pizzeria owner Kevin Morris says they do not have a surcharge, but charge full price for meals instead of the usual special prices. Photo / File
Dante's Pizzeria owner Kevin Morris says they do not have a surcharge, but charge full price for meals instead of the usual special prices. Photo / File

Imposing surcharges on public holidays seems to be on the decline at Auckland eateries, but an industry insider says establishments are compensating by raising prices year-round.

Of 22 bars, cafes and restaurants surveyed by the Herald on one block of Ponsonby Rd yesterday, 12 did not have surcharges, five did, one had removed its special prices and four were closed to observe the Waitangi Day holiday.

Under the Holidays Act 2003, anyone working on a public holiday must be paid time and a half and get a day off in lieu.

The decision by many businesses to introduce levies to cover the extra costs has been well documented, with some charging up to 25 per cent extra.

Chapel Bar & Bistro manager Warren Stewart said the popular bar had never insisted on surcharges.

"We have never done it ... it's part of the festive occasion. We spread the charge over the year," he said.

Dante's Pizzeria owner Kevin Morris said the restaurant did not have a surcharge, but charged customers in full for their meals instead of the usual special prices.

"It's here because we are a small business," he said. "It's a double-edged sword - if you do, some customers don't come but you still have to pay the surcharge to staff."

Geoff Brogan, owner of the Foxtrot Parlour in Ponsonby Central, said his business charged customers an extra 15 per cent to offset the increased staffing costs. "Last year, a lot of people complained, but this year it doesn't seem to be affecting business. Holidays are always jamming, heaving at the seams and the surcharge doesn't seem to make a difference whatsoever."

Restaurant Association national president Mike Egan said anecdotally it appeared businesses had shied away from surcharges and were covering the extra costs by raising prices in general. "All places have probably done is put their prices up all year for everyone to cover it."

He said a survey conducted by the association showed that was the public's preference.

"I know that a lot of the feedback we got from the public was: 'Just put your prices up and charge us more for it all year and that will cover it.'

"So I think a lot of places have probably put their prices up and are covering the extra holiday pay by charging all year."

There was no surcharge at his restaurants, Boulcott St Bistro, Osteria del Toro, and Monsoon Poon in Wellington and Auckland, he said.

"We open shorter hours and close earlier and just make sure everyone is super productive."

Customers spoken to by the Herald yesterday had mixed reactions.

Leah Wohllebe, a German au pair working in Freemans Bay, said she did not see a surcharge sign at the Little Bread & Butter Bakery before she had paid. "I was irritated. We don't have that in Germany, we have the normal price or places are closed."

Sisters Natalie and Kirstin Willis said they were unfazed by extra costs. "I think it's fine," said Natalie. "Staff are being paid extra so it equates to good service."

- NZ Herald

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