SB 478 menu pricing: restaurant fees, price tags and checkout

What SB 478 says about the prices you list

SB 478 added a new rule to California’s Consumers Legal Remedies Act, at Civil Code section 1770(a)(29). Since July 1, 2024, it has been unlawful to advertise, display or offer a price for a good or service that leaves out a mandatory fee. Only two kinds of mandatory charge can sit outside the listed price. One is a tax or fee a government puts on the sale, like sales tax. The other is postage or carriage actually spent shipping a physical item to the customer.

The Attorney General’s Office publishes an FAQ on the law. It calls SB 478 a transparency law, not a price control. You can charge what you like and explain what makes up the price. What you can’t do is show a lower number and add the rest later. Outside the food exception covered below, a note like “plus a 3% fee” beside the price doesn’t fix it. Neither does showing the fee before the customer pays.

The law covers sales to consumers, online and in a store. The FAQ says purchases for commercial use are outside it. This isn’t legal advice. Confirm how the law applies to your business with the Attorney General’s Office or a lawyer. Ask your city, too, whether it has its own rules on surcharges or service charges.

Here is how the FAQ sorts common fees for most businesses (the food exception comes next):

• In the price: any fee every customer has to pay. That includes fees meant to cover business costs like rent, security, wages or staff health insurance, and any “handling” charge.
• Outside the price: sales tax and other government fees, actual shipping costs, fees for optional extras, and fees that apply only if the customer does something later, like returning a rental late.
• Card fees: usually outside, because a customer can avoid them by paying another way. If you take only cards, the card fee is mandatory and goes in the price.
• Tips and discounts: voluntary tips aren’t covered, and charging less than the listed price is fine.

References: California Legislative Information: Civil Code section 1770 (opens in a new tab) · California Attorney General: SB 478, Hidden Fees (FAQ) (opens in a new tab) · California Legislative Information: SB 478 (2023), Consumers Legal Remedies Act: advertisements (opens in a new tab)

SB 1524: the exception for restaurant, bar and catering fees

Days before SB 478 took effect, the Legislature passed SB 1524. The governor signed it on June 29, 2024, and it took effect right away. It lets some food sellers keep a separate mandatory fee, like a 4% kitchen fee or a service charge, instead of folding it into each price. Who keeps that money is a separate labor-law question. The Labor Commissioner says a mandatory service charge may count as a tip, depending on how customers see it.

The exception covers a mandatory fee on individual food or drink items sold directly to a customer by a restaurant, bar, food concession, grocery store or grocery delivery service. It also covers a banquet or catering menu or contract that fully discloses the terms of service.

The catch is the condition that comes with it. The fee must be shown clearly and conspicuously, with an explanation of its purpose, on any advertisement, menu or other display that contains the price of the food or drink. That reaches past the printed menu to the specials board, the online menu, the ordering page, a flyer and a post with prices. A fee customers first see on the receipt doesn’t meet it.

Three limits are easy to miss:

• Delivery platforms. The exception doesn’t apply to third-party food delivery platforms, or to any other food delivery platform. SB 478 also states the Legislature’s intent that a platform listing the menu prices you set isn’t a violation. It adds that the law isn’t meant to make a platform add its own service fees to those prices. Your own fee is a different question. Ask the platform how it would show, and check with your lawyer before you carry it onto the platform.
• Things that aren’t food. The exception’s words cover food and beverage items. A café selling mugs, tote bags or T-shirts should treat those prices as all-in unless a lawyer says otherwise.
• Catering terms. A catering or banquet menu or contract has to fully disclose the terms of service. Put the fee, what it’s for and the other terms in the document the customer agrees to. We cover keeping those orders together in catering orders and deposits in one place.

References: California Legislative Information: SB 1524 (2024), Consumers Legal Remedies Act: restaurant, bar, and other food services (opens in a new tab) · California Legislative Information: Civil Code section 1770 (opens in a new tab) · California Legislative Information: SB 478 (2023), Consumers Legal Remedies Act: advertisements (opens in a new tab) · California Attorney General: SB 478, Hidden Fees (FAQ) (opens in a new tab) · California Labor Commissioner’s Office: Tips and gratuities FAQ (opens in a new tab)

What “clearly and conspicuously” means on a menu

Since July 1, 2025, Civil Code section 1770(c) has tied that phrase to a definition in section 1791(u). The fee text must stand out in at least one of three ways. It can be in larger type than the text around it. It can use a contrasting type, font or color at the same size. Or it can be set off by symbols or other marks. Whichever you pick, it has to clearly call attention to the words. For an audio ad that gives prices, the definition asks for a volume and pace people can readily hear and understand.

The law doesn’t define “an explanation of its purpose,” so say plainly what the fee pays for, and make sure it’s true. If the menu says the fee goes to kitchen staff, it should. The Attorney General’s FAQ reminds businesses that other California laws prohibit false or misleading advertising.

For example, a café with a 4% fee could print one line at the top of every menu page and board. It would be bold and a size larger than the item names: “A 4% kitchen fee is added to all food and drinks. It goes to our kitchen team’s wages.” A line in small gray type at the bottom of page two is the opposite.

The same goes for screens. On your website and ordering page, the fee line should sit near the prices, not behind a link or in the footer. Text people can actually read matters for everyone; see our guide to website accessibility for storefront businesses.

References: California Legislative Information: Civil Code section 1770 (opens in a new tab) · California Legislative Information: Civil Code section 1791 (opens in a new tab) · California Attorney General: SB 478, Hidden Fees (FAQ) (opens in a new tab)

Two ways to price a menu under SB 478

A restaurant or café has two honest options. Take a hypothetical café with a $14.00 sandwich, a $5.00 latte and a 4% kitchen fee.

Fold the fee in. The sandwich becomes $14.56 and the latte $5.20, or you round to $14.50 and $5.25. Rounding is your call, as long as the price you list is the price you charge. This is the only option for anything outside the exception, and it leaves no fee line to keep in step across menus, boards and apps.

Keep the fee and show it. The menu still says $14.00 and $5.00. The fee line appears, clearly and with its purpose, on every menu, board, ad and online page that shows a price. The customer pays $14.56 plus tax for the sandwich. Your menu prices stay familiar, but every new place you post a price is one more place the fee line has to be.

Either way, the menu, the point-of-sale app and the receipt should agree. Before you switch, check that:

• The fee rate and wording match on the printed menu, the online menu, the ordering page and the point-of-sale app.
• The fee shows on the receipt as its own line, under the same name the menu uses.
• The customer screen or kiosk shows prices the same way the menu does.
• Old menus, flyers and boards with the old prices are gone, including PDFs on your website and menu photos you posted on Google or Yelp.

Shops, showrooms and online checkout

Shops get no exception. A price tag, a shelf label, a product page and an ad must all show the price with every mandatory fee in it. Online, the price on the product page and in the cart should be the full price before tax and shipping. A “handling” or “processing” charge added at checkout goes into the product price. Actual shipping can stay separate.

Delivery depends on whether it’s optional. If a furniture customer can choose to pick up from the showroom, delivery is likely an optional service. The FAQ says fees for optional services don’t need to be in the listed price. If delivery is required, only the actual cost of carrying the item to the customer can sit outside it. A required setup fee or “order processing” fee isn’t shipping.

Card fees need care online. Many online checkouts take only cards. The FAQ says that when cards are the only way to pay, a card fee is mandatory and belongs in the price. Separately, Civil Code section 1748.1 says a retailer may not add a surcharge for paying by credit card instead of cash or check. It may offer a cash discount to everyone. In 2018, a federal appeals court held that section violated the First Amendment as applied to the businesses that brought the case. The section is still in the code. Ask your lawyer and your payment processor before you add any card fee.

Two more points from the FAQ help showrooms. If you can’t know the full price at the start, like a custom sofa still being specified, wait to show a price until you can. And purchases for commercial use are outside the law, so if you sell to trade accounts, ask your lawyer which of those sales count.

References: California Legislative Information: Civil Code section 1770 (opens in a new tab) · California Attorney General: SB 478, Hidden Fees (FAQ) (opens in a new tab) · California Legislative Information: Civil Code section 1748.1 (opens in a new tab) · U.S. Court of Appeals for the Ninth Circuit: Italian Colors Restaurant v. Becerra (2018), No. 15-15873 (opens in a new tab)

Every place your prices appear

A common problem is a price nobody remembered. Before you change anything, list every place a customer can see a price, then check each one against your price list. Give each place someone who checks it and a date it was last checked. When a price or the fee changes, the same list tells you everywhere it has to change.

For a café, bar or shop, the list usually includes:

• Printed menus, table cards and the menu by the door.
• Menu boards, specials boards and happy-hour signs.
• QR-code menus and the menu page on your website.
• Your own online ordering page, cart and checkout.
• Menus and prices on Google, Yelp and delivery apps.
• Social posts, flyers, emails and ads that mention a price.
• Catering and event menus, including the PDF people download.
• Price tags, shelf labels and product pages in a shop.
• The customer screen, the kiosk and the printed receipt.

Keeping the price record in your system

SB 478 sits in the Consumers Legal Remedies Act. Under Civil Code section 1780, a customer harmed by a violation can sue. They can ask for actual damages, an order to stop the practice, restitution, punitive damages and other relief. The court must award court costs and attorney’s fees to a customer who wins. Section 1782 says that at least 30 days before suing for damages, the customer must send written notice by certified or registered mail. If you give or agree to give an appropriate fix within 30 days of receiving it, that customer can’t pursue damages. Class actions have their own rules, and a request for a court order to stop the practice needs no notice first.

No part of the law tells you to keep old menus. But when a notice or a question arrives, the first thing to check is what the customer saw that day. A dated record answers it in minutes, instead of a search through old phone photos.

For example, a bar that moved from a 3% fee to 4% in March should be able to show which menus, boards and online pages carried each rate, and when. A gift shop that dropped a handling charge should be able to show the date its product prices changed.

Whether it lives in a spreadsheet, your point-of-sale app or a system built for you, keep:

• One price list: each item, its listed price, whether a fee applies, and the date each price started.
• Fee history: the rate, the exact wording and purpose customers saw, the start and end dates, and who approved each change.
• Menu versions: a dated copy of each menu, board and online menu, and where it ran.
• Checkout checks: a dated test order showing that the product page, the cart and the receipt agree.
• Catering terms: the version of the catering menu or contract each customer agreed to.
• Customer questions and notices: who asked about a fee or sent a notice, what they were shown, what you did about it, and when.

References: California Legislative Information: Civil Code section 1780 (opens in a new tab) · California Legislative Information: Civil Code section 1782 (opens in a new tab)

How we build menus, price lists and checkout that stay in step

For most single-location cafés and shops, none of this needs new software. A careful pass over your menus, your point-of-sale settings and your website, using the list above, is enough. If your point-of-sale app already holds your prices and shows the fee on the receipt, keep it.

Software helps when prices live in too many places to keep in step. When we build a website for a café, bar or shop, you edit prices and the fee line in one place. Every page of the site that shows them then updates at once. Printed menus, boards, your point-of-sale app and listings on Google, Yelp or delivery apps still need their own update, so keep using the checklist above. A new website is typically $2,500–$6,000 over 3–⁠6 weeks. A focused fix, like rebuilding an online menu or a checkout that adds a fee late, is $750–$3,000 over 1–⁠2 weeks.

For catering or showroom price lists that keep their own history, custom business software fits better: one business system is $6,000–$18,000 over 6–⁠10 weeks. These are our prices as of October 4, 2026. We connect to Square, Shopify and Stripe, and check anything else before we quote.

We don’t decide what your fee says or whether you keep one; you and your lawyer do. We make sure every page shows the same thing. Our first call is free, and you get a fixed price in writing within 48 hours of it. This isn’t legal advice. We read the current text of section 1770 on October 4, 2026. It was last amended effective January 1, 2026. Check it again before you change your prices.