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Minimum Wage Surcharge at Billionaire-Owned Restaurant Outrages Diners

The Oceanaire’s 3 percent fee struck a nerve

Brian via Popville

As minimum wages rise across numerous areas of the country, one restaurant chain decided to be vocal about passing increased labor costs onto its customers. The Oceanaire, a high-end seafood restaurant with a dozen locations across the U.S., recently tacked on a 3 percent “minimum wage surcharge” to its customers’ tabs, the Washington Post reports.

A customer at the restaurant’s D.C. location recently noticed the charge on his bill; a note at the bottom read, “Due to the rising costs of doing business in this location, including costs associated with higher minimum wage rates, a 3% surcharge has been added to your total bill.”

As the Post notes, the Oceanaire is owned by Landry’s restaurant group, which also owns the Rainforest Cafe and Bubba Gump Shrimp Co. Its CEO, Tilman Fertitta, has an estimated net worth of $3 billion.

After local blog Popville posted a photo of the receipt, commenters quickly took the restaurant to task: “Just raise the prices. If you don’t agree with DC labor laws or the cost of rent, then leave. Take your political statement and shove it,” one wrote. (The surcharge was reportedly also in effect at other Oceanaire locations including San Diego and Boston.)

“I'm happy to pay a little more so the people who work hard to make Oceanaire's owners rich can make a decent living. I am not happy to eat at restaurants whose owners have such clear contempt for their staff,” another commenter said.

A rep for the restaurant group tells the Post the surcharge has since been nixed, saying in a statement:

Due to the restaurant industry’s competitive market, we decided this was a temporary and nominal surcharge. The Oceanaire is committed to being transparent with our patrons and noted the surcharge on our menu, the customer’s bill and signage in the restaurant. In response to recent feedback, we have chosen to remove this surcharge effective immediately and will explore more traditional means to address the industry’s rising costs, such as raising menu prices.

Reached via email, Landry’s also provided this additional statement attributed to Fertitta, which claims the CEO was totally unaware of this surcharge:

With more than 500 properties, I rely upon the decisions of others to help run my day to day operations for Landry’s. Unfortunately, I was not made aware of the surcharge that was put in place at my Oceanaire restaurants and the management team has been reprimanded. I ask that all customers who still have their receipt, please return to their nearest location and we will happily refund the surcharge amount. This additional cost has been removed from all Landry’s restaurants effective immediately.

The Oceanaire isn’t the first to enact such a surcharge, and it likely won’t be the last: Other restaurants have made headlines in recent years for adding their own minimum wage fees or health insurance surcharges. Of course, a less disruptive way for restaurants to recoup higher labor costs would simply be to raise menu prices slightly; explicitly breaking out the costs and tacking them on as surcharges makes a statement that’s bound to draw the ire of some diners.

Update 8/18 3:50 p.m.: This story has been updated with a statement from Landry’s CEO Tillman Fertitta.

Billionaire-Owned Restaurant Charged Minimum Wage Fee; Outrage Ensued [WaPo]
Minnesota Restaurant Charges ‘Minimum Wage Fee’ [E]