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FSB backs government decision to make it illegal to top up wages with tips

31 July 2008 by

The Federation of Small Businesses (FSB) has backed the Government's plans to make it illegal for restaurants to top up minimum wage with tips.

The FSB said the overwhelming majority (99%) of its 2,000 restaurant members do not use tips to subsidise wages while 85% said they are in favour of legislation changing.

The group said its members believe the law change will help "create a level playing field between small businesses who pay a fair hourly rate, and larger companies who use tips to avoid paying wages".

John Wright, FSB national chairman, added: "Small restaurants want to do the best by their staff. They pay their staff a decent hourly rate. Tips are then an added extra.

"Big businesses have been using this loophole to keep costs down. This is abusing customers, who give tips in good faith. It creates an unfair playing field and means small companies, who pay their staff a decent hourly rate and let them keep tips on top, simply cannot compete."

Government confirms staff must be paid minimum wage >>

Government bows to pressure for fair wages in restaurants >>

Can we justify using tips to top up staff wages? >>

Michelin chefs back calls for government to close tips loophole >>

Tips can count towards minimum wage, finds tribunal >>

Read more on tips here >>

By Daniel Thomas

E-mail your comments to Daniel Thomas here.

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