RESTAURANTS and cafes across Australia are breaking the law more than a year after public holiday and weekend surcharges were banned,yet not one has been prosecuted by the national consumer watchdog.
A three-week investigation into restaurants and cafes found more than half had either a weekend or public holiday surcharge, or both. The surcharge was advertised in small print on the menu or was added to the bill, sometimes without the customer's knowledge.
Out of 120 randomly selected restaurants and cafes in Sydney, Canberra and Perth, 64 did not comply with the law. More than 50 were in Sydney's inner city, eastern suburbs and inner west.
The longstanding practice of charging on average 10 per cent extra in the form of weekend and public holiday surcharges was ruled illegal in May last year through an amendment to the Trade Practices Act.
Restaurants and cafes are now required to incorporate such surcharges into their prices, meaning most must supply a separate weekend menu if they wish to recoup additional staffing costs through their clientele.
Yet many operators appear ignorant of the changes.
The manager of the Waterfront Grill, in Darling Harbour, Jeremy Sloss, was imposing an illegal surcharge but changed it once a customer informed him of the amendment.
"We never had any emails sent from ACCC [Australian Competition and Consumer Commission] and the restaurant and catering association .. in regards to that,'' Mr Sloss said.
The federal Minister for Consumer Affairs, Craig Emerson, said the commission was responsible for enforcing the anti-surcharge law, but it admitted this week that it had yet to prosecute a single business for illegal surcharging.
The ACCC deputy chairman, Michael Schaper, said the commission preferred to "educate and inform", rather than impose criminal punishment.
But Dr Schaper also dismissed the survey's findings, which suggested the practice of illegal surcharging was widespread.
"We've recently had a look at compliance within the restaurant and catering sector within particular cities and our evidence today indicates that there is actually not a big issue for most industry participants,'' he said.
Yet the restaurant found to be levying the most exorbitant illegal surcharge during the investigation happens to be just around the corner from the commission's Canberra headquarters.
As recently as last week, the menu at Tosolini's restaurant was warning customers they would be slugged an extra 20 per cent this long weekend.
A manager at Tosolini's identifying himself only as ''Sam'' said the restaurant changed its menu for the first public holiday following the amendment.
''But no one else did, no one else was complying,'' Sam said. ''So I thought, 'I'm not going to comply until we get told to.'''
He said the restaurant would not be including the surcharge this weekend.
A spokesman for the consumer advocacy group Choice, Christopher Zinn, said restaurants had had more than a year to educate themselves on the new laws.
"One would have thought the message has been sent out there very clearly," Mr Zinn said.
The chief executive of Restaurant and Catering Australia, John Hart, said the ACCC had failed to consult the restaurant industry before passing the law.
"If there are to be changes like this, that impact on a large number of businesses, there should be the commitment to enforcement that they promise there is," he said.
Story by PATRICK WRIGHT, LAUREN SAID-MOORHOUSE AND AMANDA HOH June 12, 2010at www.smh.com.au