California Senate Bill 1524: What It Means for Your Business

When fees are unclear or poorly communicated, customers don’t notice at the point of selection. They notice at the point of payment.

That gap between what a customer expects and what they are ultimately charged is where friction starts. It can lead to confusion, disputes, and in some cases, lost business.

SB 1524 is designed to reduce that gap. But compliance alone does not solve the problem. How your pricing is presented still determines how customers experience it.

“Under SB 1524, businesses such as restaurants can exclude mandatory fees from the initially advertised price as long as these fees are clearly and conspicuously disclosed.”
 (California Legislative Information)

The key takeaway is simple: fees can still be separated from listed prices, but they must be clearly understood before the transaction.

SB 1524 was introduced in response to concerns surrounding SB 478 and its impact on foodservice businesses.

SB 478 required all mandatory fees to be included directly in advertised prices. While intended to improve transparency, it created operational challenges — especially for businesses managing large or frequently changing menus.

Updating every price point to reflect all possible fees is resource-intensive and difficult to maintain across locations, systems, and ordering channels.
SB 1524 provides a more practical approach.

Instead of requiring fees to be built into every listed price, businesses can separate them as long as they are clearly disclosed before the transaction.

This shifts the focus from how prices are structured to how pricing is communicated.

To meet SB 1524 requirements, your goal is simple: Customers should understand all fees before they complete a transaction.

That means reviewing how pricing appears across your business.

Key areas to review:

1. Menus and Pricing Displays

Ensure mandatory fees are disclosed anywhere prices are shown, including printed menus and menu boards.

2. Digital Ordering and Checkout Flows

Fees should appear within the customer journey, not hidden behind links or introduced only at the final step.

3. Marketing and Advertisements

Avoid creating a mismatch between advertised pricing and final cost.

4. In-Store Communication

Use signage and staff communication to reinforce fee transparency where needed.

This is not about adding more disclosures. It is about making sure the ones you already have are visible and easy to understand.

SB 1524 does not just require disclosure. It requires clarity.

Customers should not be surprised by the final total. When they are, it creates friction, increases disputes, and can erode trust.

Effective disclosure typically includes:

• visual cues that draw attention to fees
• clear explanations of what the fee is and why it exists
• distinct formatting so fee information stands apart from surrounding content

In digital environments, this often means integrating disclosures directly into the checkout experience rather than relying on separate pages or fine print.

A simple test: If a customer can miss the fee, it is not clear enough.

SB 1524 reflects a broader shift in customer expectations around pricing transparency.

When fee disclosures are unclear, the impact goes beyond regulatory risk. It can lead to:

confusion at checkout
increased disputes or chargebacks
breakdowns in customer trust

On the other hand, businesses that communicate pricing clearly tend to create smoother purchasing experiences and fewer post-transaction issues.

Transparency is no longer just a compliance requirement. It is part of how customers evaluate your business.

SB 1524 builds on the foundation of SB 478 while giving businesses more flexibility in how fees are presented.

But that flexibility comes with a clear requirement:

customers must understand what they are being charged before they pay.

To stay compliant:

make fee disclosures visible across all pricing touchpoints
ensure consistency between digital and in-person experiences
regularly review how pricing is presented

Businesses have until July 1, 2025 to meet the “clearly and conspicuously displayed” requirement.

SB 478 established the foundation for transparency. SB 1524 refines how that transparency is delivered in practice.

If you want a clearer picture of how your current pricing and checkout experience communicates fees, reviewing your customer journey from first interaction to final payment is often the fastest way to identify gaps.