Friday, 6 February 2009

I'm not paying your bloody surcharge

Since it's Waitangi Day, a public holiday, we can safely expect that some retailers will charge an extra 15% on their goods and services. Here's why I'll be taking my custom elsewhere.

Charging an extra 15%, or any extra figure at all, is needless. Businesses face fluctuating costs all the time. Someone phones in sick and has to be replaced - the boss pays extra. Tomatoes cost more when they're out of season - the boss pays extra. I've never seen a cafe hit any one with a sick day or tomato surcharge.

Sure, these extra costs are ultimately passed on to the consumer, but they're averaged out over the financial year. And those businesses which are most labour intensive and have a smaller profit margin (like supermarkets, which rely on sheer volume of turnover rather than a high margin) don't apply a surcharge, even though they've got the most reason to. They know the public wouldn't tolerate it, so they arrange their pricing structure over the year accordingly.

So why do some businesses, noticably in hospitality, apply a surcharge? I think there are two reasons: simple opportunism, and a churlish protest against workers' entitlement to time and a half on public holidays.

Hospitality businesses want you to share their resentment at having to pay their (often female and young) workers time and a half for giving up their public holiday. They want to focus your irritation on the woman behind the counter because she's receiving an increase to her (usually pitiful) hospitality wage - although she's working on the day when everyone else is at the beach, hanging out with their kids or otherwise enjoying leisure time.

And if you've got kids, working on stat holidays is a particularly big deal. It's not much fun telling your kids that their Christmas Day will be different from everyone else's, because Mummy's working.

I refuse to pay the surcharge. I have no qualms about paying more for goods and services so that workers can be fairly paid, but I've got a big problem with businesses levying that increase on stat holidays only. That's just an attempt to recruit consumers into a backlash against fair treatment of workers.


Anonymous said...

I agree completely, this holiday surcharge thing pisses me off all the time, and for the same reason. I don't understand why the business isn't covering the expense in its costs over the whole year.

However, most of my friends tell me to get over it or assume I don't want the hospo workers to earn extra.

homepaddock said...

Everyone pays a little more all the time, or those who actually use a service on a holiday pay more on the day.

It's usually cafes and restaurants which have a surcharge because the added cost is so great.

But they have a choice about opening or not, we can choose to use them or not and choose whether to use those with the surcharge or not.

We can't ask the cows to turn the milk off today so the extra cost of time and a half plus day in lieu is part of the annnual cost of production.

DPF:TLDR said...

You're absolutely right Anna. The fact that the surcharge is getting less and less common seems to me to show that it was more of a protest than a necessity of doing business. And as the protest doesn't seem to be working, it's falling away.

I boycott anywhere that uses it. Admittedly, I'm not a great cafe-goer, so that's no great hardship.

Tui said...

But homepaddock, the whole point is that when, say, tomatoes are super-expensive, the cost gets spread out over the year - I don't have to pay extra for a tomato sandwich in the middle of July. Some places create a similar effect by only offering certain foods at certain (in-season) times, but ultimately you just have to bite the bullet as a hospo worker/buyer and accept that lettuce is really expensive in July. But the people who use that service (fresh greens) at a time when it costs more (winter) aren't expected to pay a surcharge on that! So to say that only the people who use a service when it costs more should pay is a bit disingenuous, I think, because it's inconsistent with the way hospo does everything else - they only do this because they can get away with it in a way they couldn't with charging extra for lettuce!

Anonymous said...

We could start a list of surcharge free cafes to go to today- I would like to plug the cafe at Artisan Wines in Oratia.

Anna said...

Principessa, that's a great idea. Before the next stats (Easter) we should compile something comprehensive and advertise it.

Welly has apparently gone for gold with the surcharge because the sevens are in town. In this case, it's not an anti-worker thing so much as sheer opportunism. Given how busy hospitality retailers will be, they can scarcely claim hardship.

Does anyone know what the legal status of that is - ie putting your prices up for a certain day of the year, just because you have a (somewhat) captive audience and it's lucrative?

DPF:TLDR said...

Hey Anna

I'm pretty sure the law says that hospitality and eatery businesses can charge whatever they like on a day to day basis.

Mealz said...

I completely agree and also refuse to pay surcharges. Last Easter I stopped in at a cafe as I was passing through a small town. Rather than having a surcharge they had a sign on the wall said that they were unable to serve meals that day and that I should blame the Labour government, which I thought was highly inappropriate and will not be stopping there again.

backin15 said...

"...and a churlish protest against workers' entitlement to time and a half on public holidays..."

I hadn't thought of it this way. I was surprised when, on moving to Sydney, surcharges were regularly added to bills. I suspect they're almost entirely justified on the basis of penal rates. Hospitality profitability is often mostly about labour costs, so I guess I understand why it's handled in this way. I'm in two minds about it. You're right that food costs do fluctuate wildly, but then menus change to reflect that, prices too. Still, as I drink my coffee, have my 'sanger and read the paper, I wonder how I'd feel if I was stuck behind the grill!

Anonymous said...

Maybe it's because I'm not dependent on cafes for my day to day food needs, but I like the surcharges. Admittedly I frame it as a discount for using them when demand is low, and my favourite cafe actually has a "morning tea special" for people who arrive between the breakfast and lunch peaks. That's explicitly about demand levelling, and to some extent reflecting the actual cost of providing the service - if they can level demand out they need fewer staff to deal with the lower peaks. Which should also help workers avoid split shifts - it sucks having a working day that is 7-9, 11-2, 5-8. Sure, it's 8 hours but ew!

If you want a pro-worker slant, your extra payment is going mostly straight into the pocket of whoever is serving you. Which makes "why do you hate paying workers extra to work on public holidays" a perfectly reasonable question. What's to stop a cafe being cheaper than all the rest by not being open on public holidays if the rest don't have the surcharge?


Anna said...

Actually, now that I think about it, I'm less concerned with the manner in which its charged (I could live with what you've just described, backin15) than the fact that spurious reasoning has been used to make an anti-worker gesture.

There's another reason that upping prices on specific days bothers me, though. I think it's got the potential to be used against specific groups of people. For example, moteliers might be aware that a large group of Japanese tourists (for the sake of argument) are coming to town, and use the surcharge as a way of fleecing people that they think will be vulnerable to it.

A Blogger said...

The restaurant I went to had no surcharge. :-)!!!

Anonymous said...

Oops, sorry, I crossed the boycott line by mistake! my partner and I went out for dinner last night - for the first time in ages - and didn't see the 15% surcharge sign until we got to the counter to pay. Nothing on the door to warn people who support the boycott. Food was fairly poor too and waiters seemed more interested in the cricket. (Understandably, when I got home and saw the result).

Felix said...

Given how busy hospitality retailers will be, they can scarcely claim hardship.

Absolutely. Where I live, public holidays are the busiest days of the year and the hospo businesses make out like bandits.

It does make the surcharge seem like perverse opportunism.

Paul said...

My first thought:
It should be illegal.

My second thought:
It discourages customers and so takes some of the load off of the business that may well still have to work harder than normal just because people in other industries can actually have the day off. In effect it's a supply and demand issue, with businesses only want to supply a certain amount of people. Removing the surcharge might well ruin workers option to take the day off paid and may even mean extra staff have to come in on their day off, or if thats not legal(?)/practical that the business could be swamped.

And the cost of closing for a day could be more prohibitive than the prospect of creating some ill-will with (potential)/customers. Customers who are quite possibly making assumptions, without understanding or compassion.

Anonymous said...

The visitor information centre in Dunedin actually published a list of surcharge-free cafes and bars for Waitangi Day - mostly because they had cruise ships in town.

I'll be getting that list for Easter

Anna said...

Paul, I see what you mean, but the hospo workforce is pretty elastic because they employ large numbers of casuals. They can expand easily, and if they choose not to open, there aren't so many permanent workers to pay.

AWicken, between the non-surcharge list and the tino rangatiratanga flag, Dunedin did itself proud on Waitangi Day. Just a shame about that stadium business. ;-)

Anonymous said...

Okra Espresso Lounge on Sandringham Road in Auckland didn't have a surcharge this time. Yaay.

I agree with some of the above comments.
Businesses are deliberately deterred from opening on public holidays because their workers are entitled to the holiday. Therefore, having made the choice to be open, they are required to pay their staff more to be there. Passing that on to me really rips my nightie. It defeats the purpose of what was intended to be a benevolent regulation and is a bit cheaty.

But yes, I have noticed that fewer places are doing it these days :)