Boston Restaurants to Pay $422K in Service Fee Dispute

by Chief Editor

Two Boston restaurants, Carrie Nation Cocktail Club and The Dubliner, will pay a combined total of more than $422,000 in restitution and penalties following allegations by the state Attorney General’s Office. The allegations center on improperly labeled service fees charged to customers between May 2023 and June 2024.

Frequently Asked Questions

What prompted the Attorney General’s Office to investigate?

The Attorney General’s Office alleged that Carrie Nation Cocktail Club and The Dubliner charged customers a 3% “service fee” but did not distribute the money to 84 service employees, including wait staff and bartenders.

What explanation did the restaurants offer?

A representative for the East Coast Tavern Group, which owns both restaurants, claimed the issue stemmed from a description mistake in the point-of-sale system. The restaurants intended to charge a 3% “hospitality” fee, but the system labeled it as a “service” fee.

How much will each restaurant pay?

Carrie Nation is responsible for more than $143,000 in payments, while The Dubliner faces $278,500 in payments, according to the Attorney General’s Office.

Did You Grasp? The law states that a restaurant employer “must clearly and conspicuously describe the nature, purpose, and amount of the fee on a receipt, bill, invoice, menu, or other means.”
Expert Insight: The distinction between a “service fee” and a “hospitality fee” is critical, as service fees are legally required to be distributed to staff. This case highlights the importance of clear and accurate labeling to avoid legal issues and maintain trust with both employees and customers.

The East Coast Tavern Group, which also operates Emmet’s and Roxanne’s, stated that it denied violating any laws but considered the settlement with the Attorney General’s Office to be “fair and reasonable.” Both restaurants cooperated with the investigation and are now in compliance with state law.

What impact will this ruling have on other restaurants in Massachusetts?

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