Restaurant are keeping tips and not paying the waiters!

LastPenny_2 · 23 November 2009 at 8:44AM

Hi Everyone,

I am looking for some advice, Maybe one of you kind people can help me!:o

My brother works as a waiter in a very good quite posh restaurant in London. He works really long hours sometimes from 10am until 1 in the morning with a 2 hour break in the afternoon. He started on £6 an hour when he joined there in May and they told him he would get tips too. But there is a 12.5% service charge on the bill and so customers pay their bill in full without leaving a tip as they believe the service charge is the waiters tips. The restaurant don't share out the service charge amongst the waiters and waitresses (there's 4 or 5 working a shift) so all my brother and the rest of the waiting staff get is their basic pay.

Two months ago the manager told my brother he was increasing his wages by an extra 50 pence an hour and he's now on £6.50 an hour. I feel really sorry for him cos he works so hard and as the hours are so long and into the night he doesn't have much time for his studies, he is knackered.

I read in the newspaper a couple of months ago (same time they increased his wage by 50p) that restaurants, by law, from 1st October must either remove the service charge from their bills, and let the customer leave their tips as they wish for the waiting staff, or the restaurant must open up a separate bank account for the service charge money, and give that to the waiting staff on top of their basic salary.

This restaurant hasn't removed the service charge from the bill, and they're not giving the money to the waiters either. As it's a quite posh restaurant the average bill is about £50 a head for 3-course meal and wine. Each table takes between £100 and £200 a sitting (depending if it's 2 or 4 customers) and my brother works about 10 tables a day/night. I've worked out that the restaurants must be taking about £120 in service charge tips on just my brothers tables alone, but he doesn't see a penny of it. All he gets is his basic £6.50 an hour.

I told him to take it up with them but he is scared of losing his job and said the manager will sack him (everyone is scared of the manager as he shouts at them all). One night my brother came home almost in tears cos the manager screamed at him and for no reason too. He works so hard and all the customers comment on how polite and friendly he is but they don't realise he's not getting his tips.

He is trying to save like mad so that he can eventually study full time, but after he's paid all his rent and bills he's left with almost nothing. It really upsets me to think the restaurant are keeping the tips which are meant for him, and the other waiters and waitress too. Specially as the owner drives around in a really posh car and acts all flash.

My brother won't complain as he's scared but I told him that they can't sack him just for mentioning it to them.

So does anyone know anything about this new law? I read in the newspaper that it came into affect 1st October but it was quite a small article so I don't want to get him in trouble in case I read it wrong or something!:embarasse

Please, if anyone can help me on this I would appreciate it so much and I could show him the comments too.
Many thanks for reading.

Penny

McKneff · 23 November 2009 at 9:00AM

I think that particular article was to do with restaurants making waiter wages up to the minimum wage with tips.

ie Pay waiter £3.00 an hour, make it up to (say) £6 with the tips.

But i agree with you, he should be getting tips, someone will be along soon withthe legalities.

londondulwich · 23 November 2009 at 9:41AM

Before 1 October employers were allowed to make up the minimum wage by using tips and gratuities that were paid through the payroll.

The payroll means money accounted for by the company. This is the money which will appear in payslips and has income tax and national insurance deducted from it.

Usually tips are managed by a "troncmaster" who is one of the staff. They are held separately from money that is processed by the company in what is known by HMRC as a "tronc" and distributed by the troncmaster amongst the staff.

By including a service charge in a bill which is paid by electronic transaction, the employer is circumventing the tronc system. They were able to argue successfully in the House of Lords that this method of processing money passed through the payroll and therefore could be included to top up the minimum wage.

On October 1 the government removed the "that is paid through the payroll" qualification from the section that refers to tips.

This means that it doesn't matter how the tip is paid, it cannot be used to make up the minimum wage.

However, there is no legislation which states that an electronic tip must be paid to the waiter on top of the minimum wage.

So a restaurant may stop topping up the minimum wage, but chose to retain gratuities in any event. Instead of saying that it will use tips to top up the minimum wage, it may say that it is retaining them to pay for the gas and lighting of the restaurant. Having a warm, well lit place is part of the "service".

If you want the waiter to retain possession of the tip the best way is to give it to them directly, in cash, rather than to use the restaurant as an intermediary.

PeterJDavies · 23 November 2009 at 9:57AM

You need to remember that in law a service charge doesn't belong to the waiter - it belongs to the restaurant and if they choose to keep it they can do so quite legally. This issue has already been through both the UK domestic courts and the European Court of Human Rights (try googling "Nerva" and "tips"). Equally if you add a tip to a card payment it also belongs to the restaurant, not the waiter.

I work with a lot of fine dining restaurants in London and have to say that I know of none who keep all of the service for themselves - they simply wouldn't be able to retain their staff for long. It's a mobile industry and any restaurant which did this would be out of step with most of its competitors and would haemorrage staff.

So is the answer just to tip cash? Not always. If you tip cash then sure, the waiter is happy, but what about the other staff - the receptionist (first person you see when you walk in), the barman, the sommelier, the chefs who cooked the food, the kitchen porters and so on? Many of them also receive a share of the service charges and card tips in most restaurants, and if you just give cash to the waiters then they won't receive a share.

But there is no law about removing service from bills, nor any requirement to keep money separate. The 1st October change was just saying that you couldn't count payment of tips as earnings towards the Minimum Wage any more.

C_Mababejive · 23 November 2009 at 10:01AM

I know this is off at a slight tangent..but really..i dont pay service charges.

I recently dined and they had the impertinence to add 10% to the bill. I promptly crossed it off.

I prefer to leave my own tip at the end of the meal..usually myself and fellow diners put a few quid in between us.

Vader123 · 23 November 2009 at 10:07AM

C_Mababejive wrote: »

I know this is off at a slight tangent..but really..i dont pay service charges.

I recently dined and they had the impertinence to add 10% to the bill. I promptly crossed it off.

I prefer to leave my own tip at the end of the meal..usually myself and fellow diners put a few quid in between us.

Me too. I never pay the service charge and cross it off.

However I did organise a dinner for 10 people from work. There was no service charge, so I added it.

Vader

Anihilator · 23 November 2009 at 10:32AM

He has no legal right to this money.

£6.50 for waiting staff is a pretty good wage.

breadlinebetty · 23 November 2009 at 11:00AM

The new law which came into effect on 1st October states that the management cannot keep the service charge money to top up the minimum wage - neither can they use it to pay overheads of any sort! They HAVE to give it back to the staff!

Here is a link to an article written by AA Gill in the Sunday Times just a few weeks back.

http://www.timesonline.co.uk/tol/life_and_style/food_and_drink/eating_out/a_a_gill/article6860080.ece

Personally, I NEVER pay the service charge in restaurants. I tell them to remove it.

I pay the waiter or waitress directly, and how much I pay is dependant on how good the waiter service has been.

Waiting staff earn very poor money and work long unsociable hours, and as they are the ones who serve me my food, and are the most instrumental in making my experience a pleasant one, then my tip is meant for that waiter and no-one else!

My tip is for THE SERVICE - not the food - which I already pay for in the bill! The chef will be on FAR more money than any of the waiting staff are, and so he should not get a share of that tip. As for the other staff (porters/cleaners etc) they are not working with the general public and cannot expect tips. That would be like going to the hairdressers and after tipping the girl who washes your hair, giving them a few pound on top for the cleaners who come in at night and mop the floor!

I advise everyone to tell the manager to remove the service charge from the bill, and to tip the waiter/waitress in cash.

McKneff · 23 November 2009 at 11:00AM

I hope lots and lots of people read this and follow the example of crossing out the service charge and give the tips directly to the waiter. I know I certainly will from now on.

breadlinebetty · 23 November 2009 at 12:21PM

http://forums.moneysavingexpert.com/showthread.html?t=2049677

Click on the above link for another discussion on tipping in restaurants.

rumbaba · 23 November 2009 at 12:23PM

Anihilator wrote: »

He has no legal right to this money.

£6.50 for waiting staff is a pretty good wage.

You must live in a cheap area if you think £6.50 is a good wage.

Restaurant are keeping tips and not paying the waiters!

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