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Are Tips illegal???
Comments
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As per Rukspin tips are not illegal although there are possible repercussions of a firm in administration distributing them.
Unless your contract states they are yours to keep the company is entitled to do what they wish with them. Asking customers won't get round this and may actually lead to discliplinary action.
If the company is in administration then the administrator has a legal obligation to protect and maximise the creditors position hence distributing tips they don't need to by contract would be a possible breach of this duty.0 -
Hi,
That link helps a lot. Thanks.
But it doesn't clear up my main issue which is 'Do the Adminstatiors have a right to keep the tips...'
As the company is not making money and they have to 'claw' back any money coming into the buissness.
Depending on your definition of "tips" that are purely cash handed over and kept in a jar then no, they have no legal right to it at all...they are for the staff only.
If you mean "gratuity" or "service charge" tacked onto the bottom of a check then no, legally they are only expected to take about 10% for admin costs of actually sorting it out, 20% to cover various breakages of equipment and the majority slice of 70% going straight to the staff right at the end...
Since the restaurant are in receivership anyway what are they planning to do with this money? pocket it themselves? If so, that is tantamount to stealing.
People pay this gratuity expecting it to go to the staff, if they found out it was going straight to the admins to line their own pockets do you think they would be happy? Simply put, you do not even have to pay this service charge, it is just put there on the end to gaurantee the staff get something on top in most places...there is nothing to stop the waiters from placing a "cash" tips jar on the table and telling their covers why it is there. (Because it then goes straight to them instead of the bean counters)
This is what I did when I was working in a restaurant, much to the consternation of everyone else, I even laminated some cards explaining what was going on...my tips rose 60% in that time...
I personally feel that service charges are wrong anyway, they breed laziness, if a waiter knows he has to work for his tips he will go out of his way to be great, if he doesnt even have to bother what is the incentive?"Don't blink. Blink and you're dead. They are fast. Faster than you can believe. Don't turn your back. Don't look away. And don't blink. Good Luck" - The Doctor.0 -
Just found this:
Unlike discretionary service charges and credit card tips, cash tips do not belong to the business or the owner of the restaurant. They belong to the member of staff to whom they have been given. If a box or a dish is used, then they belong to employees as a group, but again not to the business or owner.
However if the tips were 'Service Charge' then the Administrators are right, the business is in administration, therefore all monies must firstly be used to pay debts (i.e suppliers etc).Life is too short to drink bad wine!0 -
Here is an idea from me to you though, if there are other jobs around calling for staff then go there, why would you want to work in a company that is sinking and is taking what rightfully belongs to you?
Organise a meeting, select a leader and tell them to go tell the administrators in no uncertain terms that if those gratuities are not put back in their rightful place you are walking...and then do it, from the sound of things you ill be out of a job soon anyways so what are you waiting for? lolSparhawke is wrong; all tips including cash must be declared, it is illegal to pocket tips as they are a taxable benefit.
The business is not keeping this money for itself, it is in administration, therefore all monies must firstly be used to pay debts (i.e suppliers etc).
Actually, Sparhawke is not wrong...as stated in my earlier post ( right here ) there is some question as to whether tips should be declared, that has never been established fully.
Try reading the whole thread properly.
And the definition of "pocketing" means to take the tips for themselves, whether they choose to declare them or not is the waiters business, not yours, not mine, certainly not the administators...it is the individuals own responsibility to get their tax sorted properly."Don't blink. Blink and you're dead. They are fast. Faster than you can believe. Don't turn your back. Don't look away. And don't blink. Good Luck" - The Doctor.0 -
http://www.vantisplc.com/Vantis/News/cashtipsanupdateforemployersandemployees.htm
Look what I found....
Unlike discretionary service charges and credit card tips, cash tips do not belong to the business or the owner of the restaurant. They belong to the member of staff to whom they have been given. If a box or a dish is used, then they belong to employees as a group, but again not to the business or owner.0 -
Here is an idea from me to you though, if there are other jobs around calling for staff then go there, why would you want to work in a company that is sinking and is taking what rightfully belongs to you?
Organise a meeting, select a leader and tell them to go tell the administrators in no uncertain terms that if those gratuities are not put back in their rightful place you are walking...and then do it, from the sound of things you ill be out of a job soon anyways so what are you waiting for? lol
Actually, Sparhawke is not wrong...as stated in my earlier post there is some question as to whether tips should be declared, that has never been established.
Try reading the whole thread properly.
I suggest you stop giving out completely false information.
1) Staff have no legal obligation to tips or gratuities or service charges unless its a contractual benefit. If it isnt the organisation can do what they want with them. If staff take them anyway it is theft. Also to add it is against the legal obligations of an administrator to gift assets away at the cost of the creditors
2) If staff walk they lose all rights to any sort of redundancy. The administrator will be estatic at the staff walking as they can replace them with cheaper options without the same employment rights
3) Tips must always be declared as income. Yes most don't and most get away with it but it doesnt make it legal.
You don't have a clue what your talking about and people like you are dangerous0 -
Since the restaurant are in receivership anyway what are they planning to do with this money? pocket it themselves? If so, that is tantamount to stealing.
Of course they are not planning to 'pocket it themselves'. They ARE the receivers and will use it to pay the restaurant's bills. Which may in part include wages.
They are not administration staff of the restaurant - they are admininistrators employed by the receiver to sort things out.
Whether the money is theirs (ie the restaurant's) to take is another matter and doesn't seem to be clear cut.0 -
Of course they are not planning to 'pocket it themselves'. They ARE the receivers and will use it to pay the restaurant's bills. Which may in part include wages.
They are not administration staff of the restaurant - they are admininistrators employed by the receiver to sort things out.
Whether the money is theirs (ie the restaurant's) to take is another matter and doesn't seem to be clear cut.
According to the link I enclosed, it seems that the cash tips belong to the employees.
Therefore the administrators have no right to take them. Doesn't matter who are they going to pay out of them, they do not belong to them so they cannot distribute them to suppliers or anyone.0 -
According to the link I enclosed, it seems that the cash tips belong to the employees.
Therefore the administrators have no right to take them. Doesn't matter who are they going to pay out of them, they do not belong to them so they cannot distribute them to suppliers or anyone.
That link is extremely lacking of any legal evidence to back up its opinion.0 -
Okay, can someone answer me this?
Employees always take precedence over any other creditors.
Agreed?
The service charges that are thought by the public (yet not told differently) are going to the administration to pay creditors.
Yet shouldn't employees get this first anyway??!
A classic catch 22 situation no?
I haver never been an employment solicitor, I have never professed to be...what I am though is someone who has worked in restaurants for a long time some years back...and for the OP, if you tell your friend simply to put cash jars on the table there is sod all the administrators can do about it. But you are responsible for your own taxes, agreed everyone? I believe that was your original question until we all got hold of it lol"Don't blink. Blink and you're dead. They are fast. Faster than you can believe. Don't turn your back. Don't look away. And don't blink. Good Luck" - The Doctor.0
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