Writing a restaurant cancellation and no-show policy: wording that holds up in BC and Ontario

A no-show costs a restaurant more than the price of a meal. Food has been bought, a table has been held and other guests were turned away. Many businesses now ask for a card or a deposit and charge a fee for late cancellation or no-shows. The fee is only as strong as the policy behind it, and a policy that guests cannot find or understand leads to disputes. Get the wording and the process right, and then ask a lawyer to review your policy, especially if it involves large sums.

What should a good policy say?

Cover these points in plain words:

1. When the guest can cancel without cost, for example "up to 24 hours before your booking".
2. What happens after that, such as "a fee of a set amount per person" or "the deposit is kept".
3. What counts as a no-show, for example not arriving within 15 minutes of the booking time without notice.
4. How the guest cancels, by phone, email or the booking page, and who confirms it.
5. What happens to a deposit, whether it is credited to the bill, refunded or kept.
6. Changes in party size, including the deadline for final numbers.
7. Special events and peak dates, if the policy is stricter for them.
8. Exceptions, such as illness or emergencies, at your discretion.

Use simple language. A policy that reads like a contract invites argument.

Where must guests see it?

Before they agree. The best practice is to show the policy at the booking step, in the confirmation message and on your website. If you take bookings by phone, say it aloud and send it in writing. A guest who never saw the fee has a stronger complaint than one who ticked a box next to it. Keep a record of what was shown and when.

How do you set the amount?

Reflect a real loss. A fee per person that approximates the food cost and lost margin on a seat is easier to defend than a large penalty. If the amount is a large part of a typical meal, explain why. For a ticketed event with a fixed menu, a higher amount may be reasonable, and you should say so in the ticket terms. If you are unsure, ask a lawyer how a court might view it.

How do card holds and charges work?

If you take a card number, tell the guest what you will do with it. Say that you will only charge it for a no-show or late cancellation, and state the amount. Use a payment provider that stores the card securely, and never record card numbers in notes or emails. If the guest cancels in time, release the hold or delete the data.

What if a guest disputes the charge?

Expect it. Guests who dispute a charge may contact you, their card issuer, or the provincial consumer office: Consumer Protection BC in British Columbia, or Consumer Protection Ontario. Your answer should show the policy, the date it was shown and the booking record. A friendly offer to waive the fee for a real emergency often ends the matter. A chargeback costs you the fee and a processing charge, so weigh it against the goodwill.

When should you waive the fee?

Waive it when a guest tells you early of an illness, a death, a travel disruption or a safety issue. Waive it for regulars whose problem was genuine. A discretionary waiver is part of good service. State in your policy that waivers are at your discretion.

How do you apply the policy fairly?

Apply it the same way to every guest. Let staff know when they can waive a fee and when to ask a manager. Keep a log of fees charged and waived so you can see the pattern.

What about groups and private dining?

Set clear deadlines for final numbers, deposits and menus. Ask for a signed agreement for large bookings. Outline what happens if the group shrinks or cancels.

What are the common mistakes?

• Hiding the policy in small print.
• Charging a large fee with no explanation.
• Not recording that the guest agreed.
• Applying it to some guests and not others.
• Charging a card without telling the guest in advance.

How do you keep the policy current?

Review it each year, and before busy periods. If guests often ask about it, the wording may need to be clearer.

More guides for your business:

• Selling food at farmers markets in Ontario and BC: vendor rules, health approval and common mistakes
• Starting a catering business in Ontario or BC: kitchen approval, permits and insurance
• Closing for the off-season: temporary layoff rules for restaurants in BC and Ontario

More in the Canadian guides for food businesses.