Tips in the UK often go to management!

[Kentan]

There was a fascinating article in The Independent today about how restaurant management often skims off the lion's share of tips and service charges:

Tipping - The unpalatable truth

Increasingly, some of Britain's biggest restaurant chains are using loopholes in the byzantine system of laws and guidelines that govern the hospitality industry to concoct tipping and service-charge policies that most of us would consider simply unfair, if not scandalous.

On a corner site in Covent Garden sits one of London's most popular tourist destinations – Tuttons Brasserie, an attractive restaurant and bar with a red awning and tables laid out on the piazza...

but what the hundreds of customers who come through the doors each day almost certainly don't realise is that, according to Unite, the waiters here earn a basic wage of zero. Yes, that's right – nothing.

Instead, Tuttons' owner, CG Restaurants, whose parent company, Liberty International PLC, last year made pre-tax profits of £129m, pays Tuttons waiters using only the "optional" 15 per cent service charge added to bills. "It's an abomination," says Turnbull of Unite, which has seen a contract showing the £0 basic wage. "How can you have a minimum wage and then say you can allow customers' tips to contribute towards that? It negates the value of the minimum wage, and the value of the tip.

...The Tuttons case may be extreme, but dozens of high-profile chains and restaurant groups, including Café Rouge, Strada, Carluccio's, Caffé Uno and Chez Gérard, pay a basic salary below the minimum wage (which is set at £5.52 per hour for workers aged 22 years and older), and use service charges and credit-card tips to make up the take-home pay to meet or exceed the minimum wage.

A loophole in the minimum wage legislation means that this is perfectly legal...

Incredible! Does anyone know if this kind of thing is common in Vancouver restaurants? Are there similar loopholes that allow restaurants here to pay below minimum wage?

[Andrew Morrison]

Yes to your first question and no to your second. Lion's share, maybe not, but my tray-carrying efforts subsidized quite a few incomes over the years. It's a fact of life on many floors.

I'm not sure if it was here or on the "other" forum, but it's been a fact of life that's been discussed to death already.

Thanks for the link to the article. Depressing read.

Edited July 15, 2008 by Andrew Morrison (log)

[Kentan]

Yes to your first question and no to your second. Lion's share, maybe not, but my tray-carrying efforts subsidized quite a few incomes over the years. It's a fact of life on many floors.

I'm not sure if it was here or on the "other" forum, but it's been a fact of life that's been discussed to death already. 

Thanks for the link to the article. Depressing read.

←

Sorry to hear that tips are subsidizing restaurants' bottom line even in Vancouver. I'd hoped that was only the case for service charges that are automatically added on.

Good news from the UK, though. The Independent's article really seems to have hit a nerve. It looks like there might be some new legislation soon - MPs from all parties have signed a Commons motion calling on the Government to change the law to ensure that waiters receive all tips in addition to the minimum wage:

More restaurants exposed for their tipping practices

Top chefs are joining the campaign:

Tipping: top chefs turn up the heat

There was even a protest outside a restaurant in Canary Wharf:

Protesters confront diners at London restaurant

Edited July 18, 2008 by Kentan (log)

[SBonner]

having worked both on the floor and as part of a management team in London I never saw much of an increase in tip out percentages as a manager; although that was back in the early '80s The perk of being in management was bonsues based on sales and cost control.

Edited July 19, 2008 by SBonner (log)

[Mark Donnelly]

It's been practised here in BC before. 30 years ago I used to work part-time at Tip Top Tailors. There was a minimum wage in BC at the time. I was paid on a commission basis. If I didn't sell enough (ie below minimum wage), TTT "topped" my wages up to the minimum level by advancing me monies.

However, if I sold more than the minimum wage, they would claw back any monies they had advanced me in cases where I didn't sell enough.

It's a disgraceful practice. But one of many in the restaurant trade (ie split shifts, part-time work with low benefits, unsociable hours, etc).