It is a common sight these days in Chicago restaurants to find a surcharge added at the bottom of the bill. This surcharge serves a specific purpose - to cover the health insurance expenses of restaurant employees. Recently, NBC 5 Responds came across receipts from Mi Tocaya in Logan Square which had a 3% surcharge added to diners' bills. Robert's Pizza and Dough in Streeterville is also following suit. NBC 5 Responds made efforts to reach out to these restaurants to discuss the surcharge, but unfortunately, they did not receive any response.

Why the Surge in Surcharges?

Matt Notowidigdo, a professor of economics and business at the University of Chicago, poses an important question. He asks why we are seeing this phenomenon of surcharges in restaurants now. The simple answer lies in the post-pandemic economic recovery. After the reopening, sectors related to leisure, hospitality, and healthcare were hit the hardest. In this new world, concerns about worker benefits, along with the rising prices of labor and goods, have led companies to become more innovative. It was difficult to get workers to return to work in these sectors, and as a result, wages for those workers started to increase significantly. From the restaurant's perspective, they are trying to retain their workforce and hire new workers. This means they need to pay more and provide more benefits like health insurance. The challenge then becomes how to pass these additional costs on to consumers.

Health Insurance Regulations and the Surcharge

According to the provisions of the Affordable Care Act, businesses are required to provide health insurance benefits if they have 50 or more employees. This regulation plays a significant role in the decision to add surcharges. Restaurants with a certain number of employees may find it necessary to implement surcharges to cover the cost of health insurance. It is a way for them to comply with the law while also managing their expenses.

The Impact on Diners

For diners, seeing a surcharge on their restaurant bill can be a bit surprising. They may wonder about the reason behind it and how it affects their overall dining experience. While it may seem like an additional cost, it is important to understand the underlying factors. The surcharge is not just a random addition but a means for restaurants to ensure the well-being of their employees. It also reflects the challenges faced by the industry in the post-pandemic era. Diners can appreciate the efforts made by restaurants to provide better working conditions and benefits for their staff.

The Future of Surcharges

As the restaurant industry continues to evolve, the use of surcharges may become more common. It is a trend that is likely to persist in the coming years. Restaurants will need to find ways to balance the need to provide benefits to their employees with the impact on consumers. This may involve finding alternative solutions or working with industry stakeholders to find a more sustainable approach. In any case, it is clear that surcharges are here to stay and will play a significant role in the future of the restaurant business.