As businesses reopen, beware of COVID-19 surcharges
New information released on Tuesday shows Philadelphia is the hardest hit "large county" in the country due to the coronavirus shutdown. That is in large part because its economy is driven by the very small businesses that are most impacted by the pandemic.
One way they might try to recover is by charging customers new fees.
As businesses reopen, COVID-19 surcharges are popping up on receipts and bills across the country.
"COVID surcharges are popping up at service type businesses. I'm seeing them at restaurants, hair salons, dentists offices," said Ted Rossman, a CreditCards.com industry analyst.
Some of the surcharges are steep. One restaurant in Chicago added a 26% COVID-19 charge in May, citing increased costs. The owners did say it created a lot of backlash on social media and they later reduced it to 17%.
A Houston salon, and many others, have added a $3 sanitation charge, saying they're spending thousands of dollars in not only supplies but safety training and more.
Businesses also point out they've incurred incredible losses: Not only were they closed for months in re-opening, they have fewer customers due to continued social distancing requirements.
"I think what they should do if they need to do something, is raise prices. I think that's generally received better by customers," said Rossman. "They just want to pay one price, they don't want to feel nickeled and dimed."
But business owners say the surcharges are actually more consumer-friendly because they're short term.
"They say, well, we just want to pass along the temporary increase but we don't want to make it permanent. I think that's well-intentioned but I do think it misses the mark," he said.
And are these surcharges legal? In general, yes as long as the fees are properly disclosed.
And as far as advice for consumers, do look out for these surcharges and if you have a problem with a fee, complain. If that doesn't work, of course, your last option is to take your business elsewhere.
