Franny’s reneges Obamacare surcharge, raising menu prices instead

On Tuesday, beloved Brooklyn pizzeria Franny’s raised prices and added a 3% surcharge to all bills to cover employee healthcare costs associated with Obamacare. 

Co-owner Francine Stephens told Eater NY on Monday that her restaurant would be raising prices (to retain chefs and other back-of-the-house staff) and adding a 3% surcharge to all bills at Franny’s in order to cover the costs of the Affordable Care Act. The additional surcharge was also noted on the dinner menu posted on Franny’s website. 

Stephens said she expected health care costs to be around $200,000 per year for her employees.

The owners of Franny’s also own Rose’s Bar & Grill and Bklyn Larder, which makes their number of full-time employees greater than 50, the threshold for requiring companies to provide health care for its employees to avoid a fine.

Following a prompt Internet backlash against the surcharge, Franny’s told Eater on Wednesday that the restaurant would not instate the proposed 3% surcharge, which was intended to support the Affordable Care Act, rather than demonize it. 

“Through this surcharge, franny’s is embracing Obamacare. Clearly our intent was misunderstood and our guests have made it clear that they would prefer to see higher prices as opposed to a surcharge. We’ve always worked in the service of our staff and guests and will amend our prices accordingly while removing the surcharge entirely,” the restaurant said in a message sent to guests. 

On Tuesday, Franny’s proposed Obamacare surcharge raised pasta prices to $19 and pizzas to $20 but now menu prices will rise to reflect the costs of taking care of the restaurant staff.

This comes at no surprise: Costs of operating a restaurant in New York City are rising. Prominent restaurateurs like Danny Meyer and Dirt Candy’s Amanda Cohen are changing the tide by eliminating tipping and thus raising menu prices.