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California Restaurants Retain Right to Charge Service Fees Under New Law

Governor Newsom signs emergency bill allowing clearly disclosed surcharges to continue, averting a ban set for July 1.

Diners order and enjoy their meals at Copra in San Francisco last year. Restaurant surcharges remain legal in the state, and some patrons aren’t happy. 
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Golden Gate Bridge during daytime

Overview

  • Senate Bill 1524 permits restaurants to add service fees if transparently listed on menus and advertisements.
  • The new law exempts food service businesses from Senate Bill 478, which would have outlawed such fees.
  • Supporters argue the fees help balance wages and cover health costs for restaurant staff.
  • Critics claim the surcharges can confuse diners and obscure true meal costs.
  • Some diners express frustration and may alter their dining habits in response to the continued fees.