Waiters will be worse off under new tipping regime, warns BHA

30 July 2008 by
Waiters will be worse off under new tipping regime, warns BHA

The British Hospitality Association (BHA) has once again warned that many waiting staff will actually be worse off when restaurants are prevented from topping up minimum wage with tips.

The Department of Business, Enterprise and Regulatory Reform (BERR) is tomorrow expected to unveil proposals to end the practice, in the wake of a long-running campaign by the Unite union and the Daily Mirror and more recent one from the Independent.

But BHA chief executive Bob Cotton, who met with BERR officials yesterday, warned that proposals have not been thought through.

"At present, they have a potentially highly unfavourable impact on pay for staff," he said. "The only person to gain will be the tax man."

Under the current system, tips distributed via a ‘tronc' are not subject to national insurance (NI) deductions.

But if the service charge is not used as part of the minimum wage, the whole minimum wage payment is subject to both tax and NI contributions, leaving staff many pounds a week worse off, as well as increasing costs for the employer, Cotton said.

"If the government wants to make these changes, they should be considered over a longer period than is being proposed so that adjustments can be made to wages and selling prices," he added.

Government bows to pressure for fair wages in restaurants >>

Government looking at taking direct action on restaurant tips >>

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

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

Newspaper launches fair pay campaign >>

CatererSearch: Tips >>

By Daniel Thomas

E-mail your comments to Daniel Thomas here.

The Caterer Blog](http://www.caterersearch.com/blogs/catering-news-blog/) Catch up with more news and gossip on the Caterer Blog here
[Newsletters For the latest hospitality news, sign up for our e-mail newsletters.
The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.


Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking