Pizza lovers are claiming “false advertising” following confusion over a 15% public holiday surcharge at Domino’s that some have labelled as “un-Australian”.
The fast food chain, which recently introduced a 10% surcharge on all Sunday orders to cover hourly wage increases, added a 15% fee to orders on Thursday to cover “labor costs” associated with the national Australia Day public holiday.
However, hungry punters complained they were misled by a “Mates Rates” themed promotional email that advertised pizza deals on the day starting from $31.95 because the promotional prices did not include the extra fees.
“Stop advertising prices then adding the 15% on when you order. If you don’t want to pay your staff extra then don’t open,” said one customer.
“Your [sic] not a little unknown company Domino’s.. Wouldn’t hurt you to do the right thing by the Aussie battler..company greediness is a terrible thing,” said another.
Domino’s social media team referred concerned customers to the Fair Work Ombudsman’s guidelines for public holiday pay rates.
The business is still negotiating an expired enterprise agreement with its workers and has introduced an additional fee for Sunday orders to cover a pay bump for in-store staff and delivery drivers in the interim. The chain has previously told SmartCompany it expects a resolution in the “first half” of 2017.
SmartCompany contacted Domino’s this morning to clarify public holiday pay rates and how the surcharge was communicated. A spokesperson responded by saying the business has had a surcharge for public holidays for a number of years, with in-store staff’s casual wages, which range between $24.30 and $24.53 in different states, doubling on public holidays.
SmartCompany has seen a version of promotional materials for the Australia Day deals that does include a note on the planned surcharge, however, the price for meal deals advertised does not include this fee.
“We are committed to providing great tasting products at an affordable price point and only charge more when it costs us more to do so—a fact our customers value,” a spokesperson for the company said.
Domino’s also highlighted that the “Australia Day” promotional deals were available to customers for up to four days, and the surcharge only applied to the price on the Australia Day holiday.
Notify customers of surcharges “in advance”
Narissa Corrigan, principal at Ampersand Legal, says businesses are free to add any additional charges to their products or services, as long as customers are notified of the final prices.
“Restaurants are allowed to charge a public holiday surcharge, but they need to clearly tell people that it will apply to their standard prices,” she tells SmartCompany.
When it comes to communicating surcharges across all menu items, it is sufficient to add a note at the bottom of menus that explains the additional fees, rather than adding that percentage fee to all individual items on a menu, Corrigan says.
However, she recommends extra care be taken when advertising prices and deals for specific days, like Australia Day.
“If businesses are advertising a particular offer that is only for a public holiday, if there was going to be a surcharge added to the price then that [offer] should be shown as the total price you would be paying,” she says.
Businesses should remember they are free to add additional charges, as long as it is obvious to the customer at the time they place an order—and it helps if it’s clear what the charge is for, Corrigan says.
“I don’t think customers take too kindly to surcharges being applied for no good reason,” she says.
* This story was updated on January 27 at 3:45pm AEDT to include an additional comment from Domino’s on the time frame of Australia Day offers.