Wednesday, May 06, 2009

Restaurants And 'Tips As Wages'

Wage slaves in the catering industry had some rare good news today with the Government’s announcement that employers are to be banned from using tips to top up staff pay.

Some unscrupulous restaurant, cafe and pub owners have been using tips and service charges to meet the minimum wage – currently a whopping £5.73 an hour for workers aged 22 and over.

But now that is to change from October – meaning the tips diners leave will go to those who actually served and cooked their meal, rather than lining employers’ pockets.

Gordon Brown confirmed the move at Prime Minister’s Question Time, saying the public consultation had proved positive and the new legislation would help protect low-waged waiting and catering staff.

Unions, which have long campaigned for change, welcomed the move.

Derek Simpson, Unite trade union's general secretary, said the Government was “doing the right thing” by closing a loophole “which has allowed greedy employers to use tips to pay staff the minimum wage”.

But the British Hospitality Association has warned that it may result in the loss of 45,000 industry jobs as hard-pressed employers struggle with the extra financial burden.

And because of tax and National Insurance implications, it argued, staff could in fact be worse off – and the only real winner would be...yes you guessed it, the tax man.

That said though, the BHA did not “oppose the introduction” – it simply questioned its timing, what with the recession and all.

But many see the move as just window-dressing from a Government keen to show it’s doing something to help the working poor (after all, when New Labour introduced the National Minimum Wage in 1999, it specifically allowed tips to top up pay packets).

The legislation also covers people on low salaries – rather than just those paid by the hour - but how much effect it will have in restaurants is open to debate.

In my last full-time cheffing job, I was paid £12,000 a year for a 14-plus hour day, meaning my hourly rate was £3.50 an hour. Tips were divvied up and came to about £100 a month, pushing my wage to about £3.90 an hour – still way below minimum wage.

My income as a commis chef was about average, and my hours in no way excessive. Some staff in Michelin restaurants pocket less money for 18-hour days – putting their wage at about £2.50 an hour.

They can of course report their employer to the Department for Business Enterprise and Regulatory Reform, but I don’t know any who have.

And who can blame them? They’re too busy catching night-buses home or sleeping on the dry store floor in those precious hours between shifts. After all, a slave, as Marco Cato liked to say, should be sleeping when he’s not working.

Interestingly, a survey this week by showed that even though the recession had dented chefs’ salaries on the other side of the pond, most were still well above the average US household income of $50,740 (about £34,000).

Maybe it’s about time we in the UK paid our chefs more? It may even be why it’s one of the few professions that still has a skills shortage...

:: Got an opinion on this? Please spare a moment and leave a comment below...


Christophe said...

I was speaking to a waiter who said that when the new rules come in to affect, the kitchen staff would lose out most as the tips would legally go to the waiters. He said that in their restaurant, there would be a gentleman's aggreement so that the kitchen staff would get a cut.

Still think its the way forward. Business always goes on about the negative effect of minimum wage legislation on the economy. Its all bullshit. Works fine in Europe who generally have much higher levels than this country.

Lennie Nash said...

That's interesting Christophe. Guess there is no legal reason why the tips should find themselves into the kitchen, and I've worked in many places where the chefs weren't given a cut.

Even when they were, some of the larger cash tips were pocketed by the front-of-house team.

I think they should be fairly divided. I know some waiters claim their attention to detail and general charm helps elicit bigger tips, but without good food and prompt service, this is nothing.

You're so right - it is completely different in Europe, and seems to work a lot better.

Thanks for your comment. Good stuff.


Nicky said...

It's interesting that people in Australia see the service industry (waiters, head waiters, sommeliers etc) as a career path in its own right, whilst we seem to treat it as a low-value, low-pay job to do in between "proper" career-oriented jobs. About time we looked at the Australian system, to see if there's something worth emulating there?

Douglas Blyde said...

I'm glad this happened for some reason...

Anonymous said...

Our website are the reliable wow gold and wow power leveling wow gold