Hotels are returning fire in the “junk fee” war. Don’t be a casualty

Watch out for mandatory destination fees and other creative surcharges.

Robert Kraus encountered the worst junk fee ever on a recent visit to Washington, D.C. That’s when his hotel added a surprise $20 “Daily Mandatory Destination Charge” to his bill.

A Daily Mandatory what?

Yeah, that’s just a fancy new word for a resort fee. Kraus’ surcharge covered food and beverage credit, bike rental, and “free” internet. But Kraus, a Miami meeting planner, says this was different: The hotel had cleverly repackaged it as a mandatory tax.

“They said they had no control over the fee,” he says. “I pointed out there is no mandatory destination tax and that they can very much drop this ridiculous fee.”

These Junk Fees were supposed to disappear after the President declared war on them.

Those annoying hotel charges were supposed to disappear after the government declared war on junk fees earlier this year. Instead, hotels have returned fire in the junk fee war by adding new extras. Customers are fighting them in the courts and Congress, but there are also ways of killing the fees one at a time.

The average hotel now charges a mandatory daily resort fee of $26, up 3% from last year, according to Randy Greencorn, publisher of ResortFeeChecker.com,

“Hotels have gotten creative in their terminology,” he says. “A resort fee is sometimes called a destination fee, administrative fee, cleaning fee, service fee, or utility fee. Some hotels now charge towel, bed sheets, and concierge fees. These are all mandatory fees on top of the room rate and taxes.”

I thought hotel resort fees were going away.

Hang on. Didn’t the Biden administration declare war on junk fees like Kraus’ daily mandatory destination charge earlier this year? Yes, it did. But instead of backing off and quoting an all-in rate, many hotels have doubled down on the extras. Even proposed legislation banning resort fees has not deterred the hotel industry from piling on more fees.

“Some hotels are continuing to drive up the average daily room rate using hidden fees,” says Tim Hentschel, CEO of HotelPlanner.com. The most common fees this summer have been cleaning surcharges and resort fees — ahem, destination fees.

“Sometimes the fee is verbally disclosed to the guest at check-in, but other times a guest might not see it unless they look closely at their check-out invoice,” he adds.

Hotel junk fees (or resort fees) come in all shapes and sizes, ranging from daily surcharges for items that used to be included in your hotel bill (like towels or “free” internet usage) to new ones like a “worker protection fee,” which supposedly covers the cost of a new law that increases hotel workers’ minimum wage.

No one knows how many hotels charge “junk” fees. But based on the number of complaints I’ve received as a consumer advocate and some of the lawsuit activity in recent months, it’s safe to say many hotels are adding junk fees during periods of peak demand and high occupancy levels. This has left travelers infuriated.

Will hotel guests grow to “love” junk fees?

For $30 a night, it includes two single-ride Metro passes per stay, a daily drop-off service via rideshare service within a two-mile radius of the hotel, access to a yoga studio, “free” electric vehicle charging, and “complimentary” domestic phone calls.

If the nightly resort fee (sorry, destination fee) was optional, that might be a pretty good deal. So, I checked with the hotel and was disappointed to learn that the $30 fee is mandatory. So technically, neither the phone calls nor the EV charging is “free.”

The Shay’s resort fee promotion is remarkable not because of its claim to make its guests love resort fees (it won’t) but because of its audaciousness. It comes only a few months after the White House pledged to kill hotel resort fees. It also reveals the hotel industry’s attitude toward junk fees. Administration officials can talk all they want — and hotels will keep raising their fees and adding new ones.

Amid resort fee fury, guests are taking hotels to court 

Hotel guests are frustrated with the lack of meaningful relief from junk fees, so they’ve taken matters into their own hands.

Earlier this summer, a group of hotel guests filed a lawsuit in Los Angeles Superior Court against several Marriott hotels, alleging that daily fees called “Hotel Worker Protection Ordinance Costs Surcharge” in Los Angeles area hotels violate California’s unfair competition and consumer protection laws.

The Hotel Worker Protection Ordinance is a new city law that requires hotel employers to compensate housekeepers if they are required to clean more than a certain number of square feet in one eight-hour shift. It also prevents hotels from offering guests any incentive to decline daily room cleaning.

The lawsuit estimates that one Los Angeles Marriott would collect roughly $3.6 million yearly from the fees. It alleges that these extra fees are confusing and misleading to customers and don’t go towards the cost of compliance with the ordinance.

The courts have been busy with hotel fees, particularly resort fees.

Two years ago, Marriott settled with the state of Pennsylvania over the disclosure of resort fees. As part of the agreement, the hotel agreed to prominently disclose the total price of a hotel stay, including room rate and all other mandatory payments, on the first page of its booking website.

It’s easy to see why hotel guests are so frustrated. In their view, hotels have stopped pretending that the fees are for anything other than profit.

That’s what Catherine Lux, a marketing consultant based in London, noticed when she checked into a hotel in Miami recently. The mandatory “resort fee” didn’t even include a beach umbrella’s cost (an extra $25).

“I’ll never understand how they can justify charging so much extra for an umbrella instead of keeping guests safe from the sun as part of the already extortionate and ridiculous resort fee,” she says.

Hotel junk fees will get worse before they get better

Why are hotels so defiant? The Junk Fee Prevention Act would eliminate these bothersome surcharges and is unlikely to pass in an evenly split Congress, say observers.

“Hotels certainly won’t move to reduce these junk fees until they’re forced to by law or intense pressure from consumers,” says Gillian Dewar, chief financial officer of Creditful, a personal finance website. “For the most part, consumers get irritated by these fees. But they accept them.”

So that’s it, then? The problem is us. We accept the fees and the hotel industry interprets that as a green light to charge more.

Good news: You can fight junk fees — and win

Just because a hotel charges a junk fee doesn’t mean you have to pay it. Here’s how to avoid them:

• Look before you book. The most ethical hotels include any mandatory fees as part of the room rate. The less ethical ones wait until the final screen — a practice called drip pricing — to tell you the all-in price. Either way, you should know exactly how much you’ll pay for your hotel before you check in. If you don’t, you have a compelling case for getting the fees removed.
• Flash your card. Loyalty program members are often exempt from junk fees. If you’re a member, let the hotel know. If you paid by credit card, you have another powerful tool for getting out of a junk fee. You can file a credit card chargeback and get the fee removed.
• Call them out. Hotel owners are highly embarrassed when guests complain about their resort fees. Even a low-level social media campaign is often enough to get these annoying extras removed from a bill.

Here are some more tips on how to fight hidden hotel fees. (Click on this.)

The meeting planner Kraus stood his ground when confronted with a destination charge. He calmly explained that as a member of the hotel’s loyalty program, he was exempt from resort fees — even if they’d been renamed destination fees.

“After much back and forth, they finally removed it from my bill,” he says. “But wow! What will they think of next?”

Your thoughts, please

Are junk fees going to get worse or better? What do you think of the renamed resort fees? And what is the solution to this common travel problem? Do you think Sen. Amy Klobuchar and Sen. Jerry Moran’s bipartisan Hotel Transparency Act solve the problem? The comments are open.

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