Benefits limit hits hotel wage costs

By Nikki Daly

Hotels facing increased costs because of the minimum wage want the Government to raise the £20 limit for staff accommodation. Under present proposals, hotels and pubs can include no more than £20 for accommodation as a part of the wage.

A document outlining the regulations is currently being drafted by the Department of Trade and Industry based on Low Pay Commission (LPC) recommendations and is expected in the autumn.

Commission assistant secretary Peter Nokes said regulations needed to be simple to be effective. "We ideally want to get rid of all benefits and have recommended that accommodation is phased out in the future." Deductions for food and laundry look set to be banned.

British Hospitality Association deputy chief executive Martin Couchman said the association had lobbied the commission hard to allow benefits to be taken into account.

"Our hearts sank when we saw that accommodation will be the only benefit-in-kind to be allowed - and they sank even further when we saw the amount."

Couchman said the LPC only relented on the accommodation principle with great reluctance.

"The only solution, although this might change when the draft regulations are released by the Government, is for employers to notionally deduct more from staff's wages. Or perhaps charge for meals - although this could mean staff pay the same as restaurant guests," he said.