Gator's Dockside, a restaurant group in Lake Mary, Florida, has gotten a lot of press lately. It seems the corporate-owned restaurants are charging a 1 percent Affordable Care Act surcharge to compensate for the restaurants' additional costs associated with providing health care to their full-time employees when Obamacare's employer mandate begins in 2015. The additional monies collected are shown on a diner's check as a separate line item called "ACA Surcharge."
According to CNN, Gator's Dockside employs 500 people, with about half working full-time. Currently, only management receives health care, but the restaurant must offer benefits to all full-time employees once the Obamacare mandate goes into effect. The fee will allow the company to continue offering full-time hours to workers instead of cutting back hours or laying off employees, according to Sandra Clark, the group's director of operations.
But is adding a surcharge to a diner's check the best way to recoup some of the costs involved with offering health insurance to employees? Granted, Obamacare will raise the cost of doing business in the restaurant industry, but will it do the same to every small business in the United States? Should we then see surcharges with our dry cleaning or when we get our teeth cleaned? And could Miamians ever see an Obamacare surcharge at local restaurants?
We asked several Miami restaurateurs and chefs to weigh in on how they feel about an Obamacare surcharge. The answers are passionate and thought-provoking.
See also Florida Restaurant Chain Charging Obamacare Surcharge
Michael Schwartz, Michael's Genuine Food & Drink, Harry's Pizzeria, the Cypress Room, and Restaurant Michael Schwartz
I think it's bull. It's a business owner's responsibility to take care of their employees. We've complained about the health-care system for so long, and now it's time to fix it. The surcharge is the most pathetic thing. Maybe we should put a surcharge for utilities too?
Jamie DeRosa, Tongue & Cheek
I'm in favor of everyone having the right to health insurance, but I'm not sure this is the right answer. Also, what is the best way to handle this with the consumer? Businesses adjust pricing all the time -- inflation, livestock, utility cost increases, etc. As an operator, do I tack on the surcharge in the interest of transparency -- or simply raise prices to cover costs? It's a sensitive issue because of the political implications, but I do believe, fundamentally, our customers, people, want to know that the folks preparing, cooking, and serving them are well taken care of, as as are their families.
Ralph Pagano, Alba Seaside Italian and Naked Taco at the Dream South Beach
I think the taxing of the bill by 1 percent, while being a novel idea, is not what I would do. Here is my math: I don't like when the company I buy tomatoes (or any item) from charges me a "delivery fuel surcharge" or an "inventory fee." My feeling is that I buy what I buy for a price that I agree to, and that's that. I offer my employees health benefits. Sure, it costs me more money, but I would rather have 85 happy employees then 85 sick ones. Health insurance is a racket. The doctors are the ones bringing this whole thing to a head, and nobody says boo about it.The facts are, we are a society that has poisoned ourselves via bad food, bad booze, bad emissions, bad use of natural resources, bad weather, and bad ozone. It is all of our responsibility to be better. I offer insurance because I want a better employee who feels wanted, respected, and looked-after. I charge five bucks for a taco. Please help me change the world -- one taco at at time.
Aniece Meinhold, the Federal Food Drink & Provisions
This topic is a doozy. For small businesses like us, insuring our staff would be nearly impossible. It would cost us between $80,000 to $100,000 to insure our staff at our current employment level because they are all full-timers. Whether you increase prices or add a surcharge, someone ultimately suffers. In a midpriced, 60-seat restaurant such as ours, without a full liquor license to offset costs and drive additional business, every penny counts. We aim to serve the highest-quality ingredients at an approachable price. We are seasonal, local when possible, organic when possible, and utilize artisan products. All of this comes at a premium.
So our options are to (A) raise prices in order to generate additional revenues to cover the cost, (B) lower (read: sacrifice) the quality of our ingredients to lower certain costs, (C) cut jobs, or (D) add a surcharge to the consumer. A and D potentially affect the consumer negatively, possibly causing them to not return and can negatively influence future revenues and the perception of the restaurant. B affects the ideology and philosophy of the establishment, thereby forcing us to use inexpensive commodity ingredients furthering already-broken food systems, which is the antithesis of being sustainable, local, and supporting the local community. C affects the actual employee and general unemployment. It's a Catch-22.
I don't have an answer for this, but I can tell you it's not going to be easy. I think about the months of May, June, July, September, October, and November, when revenues are softer, then think about the $9,000 I'd have to pay to insure employees, and it makes me shudder. Where am I going to come up with the money? Which invoice comes first? Which vendor takes precedence? It's a scary reality. And if it's scary for me, a restaurant that is fairly busy and has regular patronage, what happens to those other guys out on side streets, in less visible neighborhoods, that don't have the support we do? It's certainly a huge burden to carry. This is clearly something that all of us who own our businesses need to think about.
Todd Erickson, Haven and Huahua's Taqueria
Obamacare is the law now, and since is is the law, it has become a cost of doing business, just like rent, gas, and water. I don't think it's appropriate to put a rent surcharge or a gas surcharge on a guest's ticket, so why would it be appropriate to add an Obamacare surcharge? Here on the Beach, we already have a resort tax on top of sales tax. Too many line items. The costs of doing business should be a part of the sale price.
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