Restaurants Are Still Charging These Junk Fees — But Who Will Stop Them?

A new law aimed at eliminating junk fees, hidden surcharges, and other extraneous add-ons that significantly alter a customer's final price went into effect on July 1. However, California Governor Gavin Newsom signed emergency legislation last night of June to exempt restaurants from the requirements. 

That's terrible news for diners since all those junk fees driving up the price of eating out or ordering in are staying on your bill. 

Consumers are increasingly frustrated with mystery pricing, where the amount advertised is wildly different from the final price that actually ends up on the receipt. How much does this cost? There is no way to know unless you buy it — a problem the legislation that took effect on the first of the month was supposed to end. 

The California Restaurant Association has been fighting against the new law since the first day the bill was signed because they believe it will lower their profits. They claim the reason is that menu items are not technically goods or services as defined by California's civil code. 

See all the hidden fees that will be staying on the menu because of the restaurant exemption, which is sure to infuriate frequent diners all across California. 

Online services from TicketMaster to Uber Eats tack on surcharges, which they euphemistically call “service fees.” It’s usually unclear what exactly those fees are for and how they’re calculated — which is why consumers and legislators often refer to them as “junk fees.”

The current presidential administration has been fighting to cut down on junk fees (or at least require companies to explain which service fees they’re charging and why). However, it’s likely you’re still being charged seemingly arbitrary service fees on a variety of in-person and online orders — including at your favorite fast food or restaurant chain.

These fees can range from 3% to 30% and up, and you might not even know you’re paying them since they aren’t always itemized on your final bill.

Once upon a time, a restaurant like Wendy’s or Burger King would toss in a few extra packets of ketchup when asked. Nowadays, you’ll likely incur an extra fee of at least a few cents if you request more than the standard packet or two of sauce.

You probably expect to be charged a fee for ordering online if you use a service like Uber Eats or DoorDash. But even if you order directly from a fast food chain or restaurant’s website, you could end up paying more for the food than you would have by simply ordering it in person.

For example, in 2023, Chick-fil-A customers who ordered online paid a full 29.8% more compared to customers who ordered in person.

Alas, ordering in person isn’t always enough to save you from extra fees. At certain restaurants, if you order your food to go, you might get an extra fee tacked on just for getting takeout.

It’s possible restaurants are charging these fees to make up for the money they lose in tips when they prepare your food to go. 

Still, plenty of takeout orderers leave a tip even when they don’t dine in — and plenty of in-person diners fail to tip properly. If you typically tip when ordering takeout, being charged an extra fee just feels like adding insult to injury.

Businesses that accept credit cards are charged a processing fee for each payment they accept. (Fun fact: American Express charges the most complicated processing fees, which is why many businesses refuse to accept AmEx cards.) 

However, many companies eat the cost of processing fees and charge customers extra fees only if they use a card to buy something for $5 or less.

Although you’d be hard-pressed to find fast food for under $5 these days, some consumers say they’ve noticed card processing fees tacked on to their orders anyway.

Speaking of tips, you’ve probably noticed that more and more establishments are using card processors that ask if you want to add a tip at the end of your transactions — including at convenient fast-food-style chains like Starbucks. 

While you don’t have to leave a tip even if you’re asked for one, you might feel obligated to do so during an in-person transaction, which means you end up paying more for a meal than you’d bargained for.

Inflation isn’t exactly a hidden fee. In fact, it’s just the opposite: We’re all acutely aware of just how dramatically inflation can impact your bottom line. 

However, fast food chain prices have actually increased at a rate above the average inflation rate — in some cases by as much as two or three times the rest of the nation.

There’s only one surefire way to avoid the hidden costs of eating out: cooking at home. 

Comparing prices between stores in your area to save money on groceries, avoiding Instacart and DoorDash, and taking advantage of coupons can further cut down on costs. 

And it might even free up some room in your budget for you to occasionally indulge in your favorite fast food, overpriced or not.