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45,000 jobs under threat if practice of making up wages with tips is banned

19 March 2009

The British Hospitality Association (BHA) has warned that up to 45,000 jobs could be under threat if the Government makes it illegal for operators to top-up minimum wage with non-cash tips.

The BHA has urged the Department for Business to delay the implementation of the law, and warned that under the current economic climate the legislation would add millions of pounds of extra cost and not be the right move.

The department has conceded that the proposals would present cost to the industry and puts this at between £7m and £45m a year.

However, the BHA warned that the true cost would be nearer £400m a year and that the industry needed more time to minimise the impact.

A spokesman for the BHA said: "We're not opposing the change in legislation but we believe that the Department for Business is underestimating the impact of the change, both in the number of jobs affected, which, in our research, could be as many as 45,000, and the cost to the industry."

He added: "It should be remembered that there are vastly more independent restaurants, run by owner operators, who will be even more affected than group-owned restaurants."

For more see our tips page >>

Hospitality operators plead with Government to delay tipping law >>

Waiters demonstrate outside Commons over tips >>

Government confirms staff must be paid minimum wage >>

By Kerstin Kühn

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