Rustic Canyon, Huckleberry Cafe, Milo and Olive and Sweet Rose Creamery are the latest Los Angeles restaurants to add a surcharge to supplement their employees' healthcare costs. The four businesses, all part of owner Josh Loeb and Zoe Nathan's Rustic Canyon family, made the announcement in a newsletter to customers Friday.
A 3% surcharge will appear on all guest checks beginning Sept. 1. All employees who work 30 or more hours a week will be given a fully covered HMO plan with a carrier, or the opportunity to contribute to a PPO plan. The restaurants have also pledged to add work hours for those who want benefits but don't meet the minimum 30 hours a week.
The newsletter insists the move was not motivated by the Affordable Care Act, which requires businesses to provide health benefits to employees. Restaurants with more than 100 full-time employees need to comply by 2015, while those with 50 to 100 employees have until 2016.
"As a community of independent and family run restaurants we want to provide the best work environment we can so that we can provide long term jobs and careers for our staff instead of the usual transient employment that is associated with the restaurant business," reads the newsletter. "Offering health care is something we've always wanted to do, but for a long time felt it was financially unrealistic."
The Rustic Canyon team worked with Suzanne Goin and Carolyn Styne (Lucques, AOC, Tavern, etc.), David Lentz (the Hungry Cats), Jon Shook and Vinny Dotolo (Animal, Son of a Gun, Trois Mec, etc.) and Josiah Citrin (Melisse) to come up with a viable plan. The newsletter also mentions Walter Manzke and Bill Chait's decision to implement a surcharge at Republique.
"The cost of offering these benefits is significant and the reality is that restaurants, particularly smaller restaurants like the ones many of us own, have a very high ratio of staff members to revenue and run on very slim profit margins," reads the newsletter. "We've discussed simply raising menu prices, but ultimately food prices are tied in many ways to the ingredients we purchase. Those ingredient costs have increased astronomically recently so we're already struggling with working creatively to keep menu prices down."
Customers will be given the option to adjust their gratuity minus the 3% or they can ask to have the charge removed from the bill. Rustic Canyon will post how much it receives from the surcharge and how the money is spent on its website at the end of the first quarter of each year.
Rustic Canyon, 1119 Wilshire Blvd, Santa Monica, (310) 393-7050, www.rusticcanyonwinebar.com/.