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Afee is theprice one pays asremuneration for rights or services.[1] Fees usually allow foroverhead,wages,costs, andmarkup. Traditionally, professionals in the United Kingdom (and previously the Republic of Ireland) receive a fee in contradistinction to a payment, salary, or wage, and often useguineas rather thanpounds asunits of account. Under thefeudal system, aKnight's fee was what was given to a knight for his service, usually the usage of land. Acontingent fee is anattorney's fee which is reduced or not charged at all if thecourt case is lost by the attorney.
Aservice fee,service charge, orsurcharge is a fee added to a customer's bill. The purpose of a service charge often depends on the nature of the product and corresponding service provided. Examples of why this fee is charged are: travel time expenses, truck rental fees, liability andworkers' compensation insurance fees, and planning fees.UPS andFedEx have recently begun surcharges for fuel.
Restaurants andbanquet halls charging service charges in lieu of tips (known as amandatory gratuity) must distribute them to theirwait staff in some US states (e.g.,Massachusetts, New York,Montana), but in the state of Kentucky may keep them. A fee may be aflat fee or a variable one, or part of atwo-part tariff. A membership fee is charged as part of asubscription business model.
For telecommunications services such ashigh-speed Internet and mobile phones, anactivation fee is commonly assessed, although most companies fail to include it in theadvertised price, resulting in customer misperception on assessment and validity of the fees. An activation fee is prevalent throughout the cellphone industry and is generally assessed to cover costs of line activations and enhancements to networks.
Another fee is theearly-termination fee applied nearly universally to cellphone contracts, supposedly to cover the remaining part of thesubsidy that the provider prices the phones with. If the user terminates before the end of the term, he or she will be charged, often well over $100.[2] In the U.S., mobile phone companies have come under heavy criticism for thisanti-competitive practice, and theFederal Communications Commission (FCC) is considering limits to preventprice gouging, such as requiring the fees to beprorated.
Many cable TV andtelephone companies, includingAT&T, include aregulatory-cost recovery fee in thebill each month of around $3, passing the blame onto government regulation, and essentially charging their customers for complying withU.S. law.[3][4]
Bank fees are assessed to customers for various services and as penalties. There areunauthorised overdraft fees,ATM usage fees, and fees for having an account balance below theminimum daily balance. Some banks charge a fee for usingtellers in an effort to encourage customers to use automated services instead.[5] The fees have come in for criticism as excessive from consumer advocates. They have also targeted bank practices that maximize the assessment of fees and fees that can add up to many times the amount of small transactions.
U.S. banks extract fees fromautomatic teller machine (ATM)transactions that are made at rival banks, even if the customer's home bank has no branch in a particular area (such as when the customer is onvacation). Customers are sometimes charged twice, both by the bank that owns theATM, and again by their bank.Bank of America charges adenial fee, literally a fee for refusing service to the customer (if there areinsufficient funds or a daily limit), and a fee to simply check theaccount balance at a "foreign" (other banks') ATMs.[citation needed]
Following the2008 financial crisis and legislation passed by Congress, banks modified manycredit card agreements with customers.
Like an activation fee, asetup fee is often charged by places thatrent space or other things. In the case ofself-storage businesses, this negates claims of "only one dollar for the first month" made byPublic Storage and others.Apartment complexes often charge fees for pets (mainly dogs and cats). Some complexeseuphemistically call these anon-refundable deposit, ignoring the definition of adeposit as inherently being refundable.
Atitle company or attorney collects a variety of fees in the course of handling the purchase of a house at aclosing. These may include fees for tax service, flood certification,underwriting,appraisal,credit report, record deed, record deed trust, loan signing and processing.
With respect toevents tickets, online reservations and payments, and other transactions, there is sometimes a service charge (often called aconvenience fee) that serves as additional compensation for the company facilitating the transaction.Ticketmaster and others charge this, and have made abusiness model of it. However, such groups have a monopoly on particular events or even entireconcert venues.
Airlines have long charged fees for changingflights, and for excessluggage. However, with theoil price increases since 2003, many are increasing fees.[6] In May 2008, it was announced that some would be charging even for just one checked bag, making it nearly impossible to avoid. Airlines have also invented fees for nearly every "service" that has always previously been included in the ticket price. While the extra income may be necessary to prevent bankruptcy, the practice of not including mandatory fees in the stated price is deceptive.
Airports also chargelanding fees to airlines in order to cover costs, particularlyairport security.
Some businesses charge fees just for talking to acustomer service representative.DirecTV charges this when ordering apay-per-view movie via telephone instead of through theset-top box. Some companies charge fortechnical support, either prepaid or by using apremium-rate telephone number (such as the 1–900 numbers inNorth America). In the 2000s (decade), some banks in the U.S. began charging a fee just to visit ateller, prompting such customer anger that the banks were forced to back down.[citation needed]
Aspeaking fee is a payment awarded to an individual forspeaking at a public event.
Late fees are charged when payment is not received by adeadline.[7] These are supposedly intended to get people to pay rent or other charges on time, but these are sometimes exorbitant, or extremely out of proportion to the amount of money which is late. They can also add insult to injury for people who have hit hard financial times, making their situation worse. When added to credit card bills orcheck cardstatements, it may also cause an overlimit or NSF fee, creating an endless and inescapable cycle of fees that trigger other fees for people already stretched to their financial limit.
Some retail stores add fees, mainly for "guest passes" atmembership warehouses likeCostco andSam's Club, where membershipdues have not been paid.
There are a few other "cost-plus" stores, however, that add about ten percent atcheckout, using the lower shelf price to trick consumers into erroneouscomparison shopping. At Food Depot and other smaller low-end chain stores like this, the shelf price may be $1.95, when theshopper will actually be charged $2.15 in the end, in a sort of legalizedbait and switch. (Furthermore, adisclaimer indicates the shelf price is not even the actual cost to the store.)
Anearly-termination fee is charged by a company when a customer wants or needs to be released from a contract before itexpires. One example is when a renter leaves an apartment before a year-long contract is over. If tenants rent for a shorter period, or month-to-month, they are instead charged significantly more per month, and are often denied anypromotionaldeals. Mobile phone companies in the U.S. are notorious for huge early-termination fees, typically starting at $175, and falling by only a few dollars per month, no matter the actualcost of orsubsidy to the phone.
Somemortgage companies also chargeearly payment penalties if thehomeowner pays more than is due in order to reduce theinterest owed and to shorten the remaining term of the loan. The fees typically negate this advantage at least in part.
There are also fees charged for any type of termination even if the contract was expired. In thesuburban Atlanta county ofGwinnett for example, customers were hit with termination fees of over $23 when thecounty commission chose not to renew the contracts of the countytrash collectors in November 2008. The two companies charged this both in violation of county law and inbreach of contract.
Animpact fee is a charge which a developer must pay to local government, in order to raise money forcapital improvements to roads, libraries, and other services upon which the newland development places a burden. This prevents existing residents from being forced to pay in taxes, in addition to already having to put-up with the traffic,noise, and environmental damage of the new development.
In government, the difference between a fee and a tax is that a fee is paid for specific goods or services rendered by the government, while a tax has no connection to the benefits received for an individual.[8]
Auser fee is a fee paid for the use of a public resource, like a park. This is most common fornational parks, and often alsostate parks orprovincial parks, and for privately owned areas.
Fees are usually charged for various government services, includinglicense plates and annualmotor vehicle registration, as well asdriver licenses andprofessional licensing. Fees are also charged for various permits, likedemolition andbuilding permits, rezoning, andland grading (which causessilt); and sometimes for increasingstormwaterrunoff, destroying native vegetation, and cutting-down healthy trees.
Sometimesfee is used to mask what are actually penalties or taxes. For example, Virginia's now-repealedCivil Remedial Fees were actually a tax on drivers with certain kinds of traffic law violations.[citation needed]
Private schools typically charge fees, and atpublic universities andcommunity colleges, students are chargedtuition andmatriculation, when can themselves be considered fees charged percredit hour. However, the termstudent fees typically refers to additional charges which the student is required to pay, typically no matter how many hours the student is taking in theacademic term.
Commonly this is a student activity fee, which helps to fundstudent organisations, particularly those which are academic in nature; and those which serve all students equally, likestudent government and student media. A newer fee is thetechnology fee, which is often charged to students by schools whenstate government funding fails to meet needs for computers and otherclassroom technology. Students may also be charged a health fee which usually covers the campus nurse, and possibly a visit to a local clinic if the student isill.
Parking fees are normally optional, because students may not have their own automobiles. However, many U.S. schools are now forcing meal plans on their students, particularly those that stay indorms, and some force freshmen to stay in the dorms. Generally, all fees except parking are covered under scholarships, whether they are from private, government, orlottery funds. However, at least one U.S. state (Georgia) began denyingHOPE Scholarship money for any new fees added, even by its own state schools.
Services Charge is a type of consumer and additional add-on fee and charge which is in place in Singapore, Taiwan and Hong Kong restaurants and food outlets to cover the cost of the primary services and all staff costs. The services charge in these territories is 10 per cent. Services fee and charge is collected by the private company restaurant and is not a government tax.
It is legal to charge Services Charges in restaurant and food outlets under Singapore, Taiwan and Hong Kong laws. However, restaurants and food outlets in these territories must legally disclose the charge/fee to customers who dine at the venue. Refusing or declining to disclose to customers an additional services charge is illegal under consumer law. Restaurants could face heavy fines or a warning.
In normal circumstances in other countries the services fee charges of 10% is included in the price of the meal. The disadvantage is that this can create misunderstanding and confusion for some people. In the United States of America, restaurant add on services charge is optional, because it has a tipping system. When the customer tips the restaurant it become a form of services fee.
In Australia the restaurant and food outlet services charge add on is included in the price of the food meals. However some restaurants and food outlets make additional services charges on public holiday and Sundays, known as public holidays surcharge. The public holiday surcharge in Australia can range from 10% to 15% to cover the cost of staff working on holidays or weekends.
Hidden fees, surprise fees orjunk fees are fees that are not mentioned until payment is required, or only mentioned insmall print. Examples includeresort fees andTicketmaster service fees. These are illegal in some places.[9][10][11]Joe Biden has pushed federal agencies to limit junk fees in the United States in 2024 through theFTC,FCC andCFPB.[12]
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