TALLAHASSEE, Fla. – A Florida lawmaker’s proposal to crack down on automatic gratuity and service charges at restaurants is now part of a bill going through the State House.
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HB 535 passed its first committee stop on Wednesday, Local 10 Orlando news partner WKMG News 6 reports. The bill is meant to make it easier for restaurants or public lodging businesses like hotels to remove someone who is not paying their bill.
However, committee members also tacked on an amendment to the bill that would ban automatic gratuity and service charges for parties of fewer than six guests at restaurants, cafes, and other food service establishments.
For parties with six or more guests, the amendment says guests may not be required to pay for the gratuity or service charge if someone in the party complains to a manager about the quality of service.
Information on the service charge or automatic gratuity must also be clearly spelled out on menus and on receipts the business must also explain who is receiving the gratuity or service charge, and how much of it they are getting.
State Rep. Demi Busatta, R-Coral Gables, proposed the amendment after receiving a bill at a restaurant in Miami earlier this month that had both a service fee and a pre-set gratuity.
“In Miami, we’ve seen a growing circumstance where all the restaurants are automatically including a 20% gratuity, or they’re calling it gratuity or service charge or service fee or tip, not just on regular sitdown meals but on take-out as well at fast-casual establishments,” Busatta said.
The amendment is meant to crack down on a growing and controversial trend in the food service world.
According to a 2024 article by the payment system company Square, 3.7% of restaurant transactions included a service fee. That’s up from only 1.27% in early 2022.
Square also released a November report that showed tips make up 21% of the average restaurant worker’s income in Florida. The average tip on restaurant checks was 15.66%.
The Florida Restaurant and Lodging Association supported HB 535 before the amendment was added. A spokesperson tells News 6 that the amendment would hurt businesses trying to ensure their servers and staff are paid, especially in cities with a large number of visitors from countries where tipping for a meal is not common practice.
“While we understand consumer fatigue surrounding service charges at businesses where it does not make sense for there to be gratuity, many restaurants in Florida and across the U.S. use service charges as a key tool for ensuring service and success,” said Samantha Padgett, FRLA’s vice president for government relations and general counsel. “Florida statutes already require that a service charge notification appear on the menu and on the customer’s receipt. We feel there are important and effective ways to build on the current notification requirements that are currently in statute that will result in better customer communication. We believe a customer deserves to have the information needed to make their own decisions about where to dine.”
HB 535 now goes to the Criminal Justice Subcommittee next.
Meanwhile, a similar bill in the Florida Senate, SB 606, does not have the amendment. In order for it to survive, lawmakers will have to put the proposal in both bills.
SB 606 also passed its first committee stop on Wednesday and now moves to the Senate Criminal Justice Committee.
The original intent for HB 535 and SB 606 is to clarify the rules and definitions between a guest and a tenant so that someone who runs a restaurant or public lodging business can remove a guest for failing to pay a bill or properly check out.
It also removes the requirement that a law enforcement officer must arrest a guest who refuses to leave the business in the officer’s presence. The officer can just remove them.