Restaurateurs have long complained that food delivery platform Grubhub takes a huge, sometimes unfair cut from orders, but now, one owner is accusing the service of slyly charging even when orders are never placed, according to a recent lawsuit filed in Philadelphia. Several NYC restaurant owners also claim that the company, which also owns Seamless, has charged fees for customer phone calls when the calls didn’t result in orders, sometimes paying hundreds to the company, the Post reports.
The recent conversation was ignited by a restaurateur in Philadelphia who has had enough: Munish Narula of the chain Tiffin Indian Cuisine filed a $5 million lawsuit against the company in December, claiming that he’s been charged faulty fees for at least seven years. He’s seeking class action status for the suit to cover other similarly targeted restaurants.
Here in New York, places like Enoteca On Court in Carroll Gardens also alleges to have been charged for non-orders. Enoteca received a call from a customer asking if gluten-free pasta was available, and the restaurant was charged $9 for the call, though an order wasn’t placed. Owner Marco Chirico tells the Post he disputed $400 to $900 worth of non-orders and was able to get a refund, but only after waiting an hour to speak with a representative to request transcripts for the phone calls.
Eunhee Park Cohen, who owns Tabouleh in Hell’s Kitchen, claims she was charged between $4.50 and $5.67 for 21 questionable calls in April. And another NYC restaurant that chose to remain anonymous estimates that Grubhub collects $2,000 a year for calls made by people asking about menu items.
To track phone calls made by diners using the app or website, Grubhub sets up new phone numbers for the restaurants that use its services. That distinct number is the one displayed on its platform, rather than the restaurant’s actual number.
But Grubhub says it uses a “statistical model” to determine whether or not a phone call to the restaurant resulted in a food order, and that restaurants can review recordings of the calls to dispute any charges. The company denies the claims in a statement sent to the Post.
Restaurateurs like Chirico say they’ve had trouble gaining access to all the transcripts, and the lawsuit claims that any call above 45 seconds incurs a charge. Meanwhile, other business owners say they don’t have the time to go over all the call transcripts to find the hidden fees.
After hearing about the issue, the New York State Restaurant Association has reached out to its 1,000 members to alert them of possible false charges.
It’s not the first time that restaurant owners have complained about the company. Many say that the platform is unfriendly to the restaurants, saying that commission to the site rivals rent costs. Some restaurants pay as much as 30 percent commission to get better placement but feel they have no choice but to be on it.