Leaving a tip electronically by debit/credit card.

lavender_sweet

Just thought I would post an interesting conversation that I had with a waitress in my local 'Frankie & Bennies' restaurant the other day. When paying with my debit card and the option came up to leave a tip with this payment I asked her if she would get the tip I left if I did it this way. She said no, that all tips left via card basically 'made up' their wages as they get paid below minimum wage and the rest came from all the tips sent to F & B. If however you left money on the table as cash, your waiter/waitress could pocket that personally. I was shocked that a company could get away with doing this and obviously F &B's aren't the only ones who use this 'system'. The consumers are paying the staffs wages !

Moomum

My mum works for another big restuarant chain and my cousin works for F & B, what happens is that if tips are left on a credit/debit card then the waiter/ress gets taxed on the tip and they only end up with a certain proportion of the tip.

Astaroth

Of cause the consumers are paying staff wages? who do you think paid them? We also pay for the ingredients, electricity, furniture, lease etc

As natmid said, the only difference between leaving a tip in cash over electronic is the fact that the staff will be taxed on electronic tips as it all goes through pay roll rather than straight into the pocket. Of cause I am sure legally earnings from tips should be declared to the tax man even if given in cash but being realistic I cant see many waiters etc filling in a self assessment every year to declare them all.

DjP

So she was lying ...

to get more money she ran down her bosses

remember that next time it comes to tipping her


x

Bossyboots

One of our young relatives worked for a large restaurant chain and they didn't see anything from the electronic tips at all. They could keep any cash tips left at the table but the company kept the others.

Astaroth

Bossyboots wrote:

They could keep any cash tips left at the table but the company kept the others.

Which to be honest is what I have always suspected would be happening and why I always leave cash (if I decide to tip - will never pay the optional 10/ 12.5/ 15% service charge either but leave a tip of the size I decide)

moonrakerz

Astaroth wrote:

Of cause I am sure legally earnings from tips should be declared to the tax man even if given in cash but being realistic I cant see many waiters etc filling in a self assessment every year to declare them all.

Agree there !

I think the thing about leaving a tip electronically is that it is then classed as "earnings" so National Insurance is deducted as well as Income Tax !

KizzyK_2

Same in Pizza Hut - cash tips on the table when to the waitress but card tips went to the shop :rolleyes:

greyteam1959

lavender_sweet wrote:

Just thought I would post an interesting conversation that I had with a waitress in my local 'Frankie & Bennies' restaurant the other day. When paying with my debit card and the option came up to leave a tip with this payment I asked her if she would get the tip I left if I did it this way. She said no, that all tips left via card basically 'made up' their wages as they get paid below minimum wage and the rest came from all the tips sent to F & B. If however you left money on the table as cash, your waiter/waitress could pocket that personally. I was shocked that a company could get away with doing this and obviously F &B's aren't the only ones who use this 'system'. The consumers are paying the staffs wages !

So Frankie & Bennies pay their staff below the minimum wage.
If this is correct ( and I doubt it very much) report them to the relevant government department.
If they are paying below the minimum rate all the staff will receive back pay for up to six years !!!!!

katiepoppycat

The waitress was NOT lying!! Here is the deal. The restaurant group - F&Bs, Chiquito's, Garfunkels, CAffe Uno, Est Est Est and probably others have a policy where staff's stated hourly rate is usually £0.50-£1.00 BELOW the minimum wage. Credit card tips and service charges(grats) are used to make up the difference. IF the server does not get enough grats to fill in the gap, the company must make up the difference. I worked for a RG outlet for 2 years and they had to cough up the difference twice in that time. This isn;t just confined to RG other outlets do it and frankly, it stinks. Two guys took it to the European Court of Human Rights where it was deemed to be perfectly legitimate. It's not illegal, just unethical. The company gets away with paying it's staff less than the going the rate and if you the customer want to reward your server your reward is cheapened because it's actually making up their minimum wage. Yes, you could argue that it encourages the servers to work that bit harder, but in that environment they already have all the encouragement they need. The company not only saves the £1 per hour per worker but also the tax and NI on it too! And the final insult? They use it to pay your wages, you get taxed on it, and the company takes 10% of it for 'processing charges'. And it's a sackable offence to tell a customer this. I'm not saying the RG are especially evil as they are not alone in doing this, but if you value the service you get ANYWHERE, give them cash! And finally, you are perfectly entitled to refuse to pay the service charge on the bill and give the amount straight to your server in cash. I had a wonderful regular customer who used to do this a lot and I'll never stop being grateful to him for that courtesy.

trisontana

The situation is even worse in America. Waiting and similar staff are exempt from the minimum wage regulations and so rely much more on tips to get a decent wage. They expect tips of between 15 and 20%.This why eating-out seems at first glance to be cheaper than over here. But add in that "compulsory" tip and you will get a truer cost of eating out in the States.

Even if they were paid the minimum wage it would still only be $5.15 (£2.60) an hour.