It Turns Out More Restaurants Are Charging a “Wellness Fee” Than We Thought
And not many of our readers are thrilled with the idea.
Lola’s Garden in Ardmore is one of the Avram Hornik/FCM Hospitality restaurants in the Philadelphia area charging a wellness fee. / Photograph by Victor Fiorillo
Editor’s note: Less than 24 hours after this report, FCM Hospitality has decided to no longer charge customers an “employee benefit fee.” Read the follow up to this story here.
Earlier this week, I told you about a five-percent “wellness fee” that the chain restaurant Founding Farmers in King of Prussia is charging customers. The wellness fee at Founding Farmers is meant to cover costs pertaining to employee health and wellness, yes. But the restaurant also uses the wellness fee to offset the price increases on things like napkins and silverware. In any event, the charge at Founding Farmers was the first wellness fee I encountered in the Philadelphia area. But it turns out that more restaurants in the Philadelphia area are charging a wellness fee than my editors and I first thought.
FCM Hospitality, which is owned by Avram Hornik, has been charging a three-percent wellness fee — they call it an employee benefit fee — on all checks since March. You may not know the names FCM Hospitality or Avram Hornik. But you almost certainly know and have probably been to their restaurants and bars.
FCM operates such popular destinations as Morgan’s Pier and Liberty Point on the Delaware River Waterfront. They have Lola’s Garden on the Main Line. In South Philly, the Dolphin Tavern is their main destination. That’s just to name a few. (You can see the entire list of FCM establishments here.) Founding Farmers prominently mentions the wellness fee on their website. They also provide a thorough explanation on their website. But we couldn’t find such an explanation on FCM’s various sites. So we asked the company for details.
“Back in March, FCM started adding a 3 percent employee benefit on all checks,” an FCM spokesperson wrote in a statement. “The practice is starting to become more common in the industry, which helps them provide a quality of life for the employees without having to drastically raise prices for the guests.”
So where does all the money from the FCM wellness fees go?
“All of the money that’s collected goes directly back to the employees for things such as employee programs, to ensure a guaranteed wage, and for weekly bonuses for all their locations,” wrote the spokesperson.
“This just isn’t how things should be done,” insists Radnor’s Keith Taylor, a longtime Philly-area chef who currently owns Zachary’s BBQ in Collegeville. “When you have additional costs or additional things you need to pay for, you roll the costs into your menu pricing. You don’t just add a line at the bottom of the check and call it a wellness fee.”
Taylor says that in addition to his philosophical problems with simply tacking a wellness fee onto the bottom of a check, he also has concerns about where the money might actually wind up, hypothetically. “I don’t know the local businesses that are using wellness fees, so I cannot speak to them in particular,” he explains. “But it would be very easy for this to become a dishonest practice. You can say it’s for whatever you want, but restaurateurs are well known to figure out creative ways to steal money from their employees.” He pointed to the Mario Batali scandal — well, one of the Mario Batali scandals — as a prominent example.
He adds that he’s been following threads on social media about wellness fees ever since he saw somebody post a receipt showing one last week. “Consumers are not fans of it,” Taylor observes. “At all. They are pushing back.”
Indeed. When I ran my article on Tuesday about the wellness fee at Founding Farmers, I asked readers to reach out and tell me what they thought. And I got a flurry of responses … not one of them in support of wellness fees.
Here’s a sampling of reader mail:
I think the wellness fee is another example of big corporations passing costs they should be handling onto the consumers. Instead of asking customers to dig into their pockets further why not have the big wigs in corporate dig into their pockets if they actually gave a flying fig about their employees? I have eaten at Founding Farmers several times, and the service and food are usually very good. But this new policy may have me thinking twice about dining here in the future. — Ruth D.
Be honest. Fix your business model. Raise your prices if needed. — Barry F.
Why can’t these companies, their CEOs, or their boards, maintain the cost to their customers and take a smaller profit? We’ve seen prices for raw materials go down after the pandemic. These individuals are simply lining their pockets. Rather than not ordering a second appetizer dessert, I won’t frequent this restaurant at all. — Matthew
As a bartender, enough is enough! People don’t like to tip as it is. Why burden them with a wellness fee? I mean just leave well enough alone! — Nicole B.
On top of high prices, generous gratuity, and credit card fees? Nope! — Bridget F.
I could go on, but you get the point.
