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The tipping point

Matthew Finnegan looks into Unite's initiative for a Fair Tips Charter, launched in Manchester during the Labour Party Conference

Published on September 22nd 2008.

The tipping point

Waitress Leanne Clapham is emphatic.

“We provide the service. The guests want us to have it – why should others take it instead?”

She is talking, of course, about tips.

There is still the need for a transparent tipping system so that all customers know exactly where the money they leave for waiting staff is going.

Trouble is, says the trade union Unite, there are too many restaurants, bars, pubs, clubs and hotels in Manchester and throughout Britain which are pocketing customers tips for themselves. They are exploiting a loophole in the law, which allows them to pay staff below the minimum wage of £5.52 an hour – and then use the tips to top staff wages up to the legal level.

The government has already pledged to plug the loophole in the legislation - if time doesn’t run out for Gordon first. But this week Unite launches a new campaign at the Labour Party conference in Manchester calling on the food and drinks industry to sign up to a Fair Tips Charter.

General Secretary Tony Woodley says: “There is still the need for a transparent tipping system so that all customers know exactly where the money they leave for waiting staff is going.”

The Charter pledges employers to pay staff at least the minimum wage and 100 per cent of all tips. It calls for employers to agree with staff how tips are shared and to end the practice of making deductions out of tips to cover breakages, till shortages or customer walk-outs.

And Unite want the hospitality business to make clear their tips and service charge policy to both staff and customers.

Just twenty local establishments have so far signed up to the Charter and they are now proudly sporting green campaign stickers in their windows.

Leanne, 20, is one of the lucky staff – she works in the lounge bar at the Midland Hotel, where staff are paid above the minimum wage and where they all share the customers tips, whether by cash or credit card.

“It’s a fair system,” she said, “the cash tips are put in one pot and we usually get between £5 and £12 each at the end of every shift. Then at the end of the month we get the tips from credit cards - that can be between £120 and £150.”

Unite have also launched a web site (www.fairtips.org) and published a Fair Tips Directory, with a city centre map of the 20 establishments who have signed up.

They have urged the 16,000 Labour delegates and visitors to Manchester to eat and drink only at those places sporting the stickers.

Missing from the Fair Tips Charter is Pizza Express in Peter Street, which had been due to host a Labour Party dinner on Friday night.

Organisers switched venues at the last minute because the chain refused to sign up. Former government minister Stephen Twigg, now Labour candidate for Liverpool West Derby, said: “There was no way we were going ahead with it there – and we would really like to know why Pizza Express won’t sign the charter.”

Pizza Express meanwhile failed to provide Manchester Confidential with a promised written statement explaining their reasons for refusal and their reaction to the mini boycott. But their web site insists that all staff are paid the minimum wage, together with numerous fringe benefits and that staff are not short-changed out of their tips.

At issue appears to be the Pizza Express policy of levelling an 8 per cent ‘administrative charge’ on credit card tips, to cover tax.

“That could soon become the norm” say Unite. A spokesman added: “The signs are that many chains are preparing to offset the cost of paying the minimum wage by keeping a greater share of tips and service charges.”

The unexpected beneficiary of the Pizza Express boycott was the Beluga restaurant in Mount Street, which found itself hosting the inaugural fund-raising dinner of the North West Labour Gay, Lesbian and Transgender group.

Manager Phil Whitfield said: “Our staff have always kept all their tips. I used to work for a big Italian chain and we had to hand all our tips over to the manager. At the end of the week we were given an envelope. But we never knew how much had been kept – we were definitely short-changed.

“More and more customers are now asking the staff if they keep the tips themselves, particularly when they are paying by credit card. There is much greater awareness that it is an issue.”

Even some Manchester boozers are backing the Charter – including the Marstons-run Red Lion pub out on Wilmslow Road in Withington.

Manager Kevin Connor said: “It’s only fair. If customers want to tip the staff, they should be able to keep it all.”

But the Fair Tips campaign still has some way to go to spread the word to all restaurateurs.

The Yang Sing on Princess Street, which played host on Saturday night to a glittering £55-a-head Conference Dinner with Foreign Secretary David Miliband and special guest Eddie Izzard, has not yet signed up to the Charter.

Spokesman Margaret Gore said: “No one has asked us yet – but we would be very happy to sign up. Everyone should - we have a Minimum Wage in this country and it should be observed. And staff should be able to keep all their tips.”

Meanwhile back at the Midland, Leanne Clapham is hoping this year’s Labour conference will be a welcome money spinner.

She said: “I’ve just passed my driving test and got a new car – so I’m hoping Labour are not going to be tight!”

The Manchester restaurant's who have signed up for the Fair Tips Charter: Ape and Apple, Ashoka, Beluga, Bull's Head, Castlefield Hotel, Croma, Jury's Hotel, Koh Samui, La Vina, Luso, Midland Hotel, Old Monkey, Pesto, Pizza Hut, Rising Sun, Royal Orchid, Taurus, Teppanyaki, Thistle Manchester.

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18 comments so far, continue the conversation, write a comment.

disgruntledSeptember 22nd 2008.

trying working in any indian resturant even the ones featured here. Not only do the owners keep all the tips but they pay less than minimum wage, even the likes of east is east Akbars and Karims. Some indian resturants pay their staff 1 pound an hour and pocket all the tips that their staff have earned. so as a staff member you take abuse of the owner and have your tips robbed and are only ever paid less than mimimum wage. Fact.

AnonymousSeptember 22nd 2008.

AD, but the 40 odd % that I do get I get taxed on as it's in with my wages?! Yes I did agree to the situation when I got the job, but that doesn't mean it's fair!I would prefer to have all tips in cash and then give a certain percentage to the kitchen, we already give 10% of our cash to the service bartender and 10% to the bussers who help us clear tables, so I don't see why we can't just do the same for the kitchen.On the whole I like working there and as I said the system is used company wide so our unit can't just change it's way of doing things, however much we rant to the management!Customers should be aware of where their money is going to, that's all.

mSeptember 22nd 2008.

Does the kitchen staff get any of the tips? They should.

AnonymousSeptember 22nd 2008.

Exactly Tbizzle; Tips are earned, not a given. Which makes the practice of employers keeping tips, all the more abhorrent. Who's got the bollox to name their shameful employer then?

GarySeptember 22nd 2008.

Tipping for superb service is fine....the issue is that in this country you very seldom get good service let alone great! We are also getting towards a culture of expecting tips (as in the US). I ate in 3 restaurants in Manchester last week - 2 of them didn't even have waiting staff that spoke English, then prompted a tip on more than one occaision. Only Piccolino gave even good service, yet gave no prompt for a tip by either waiting staff or credit card machine. Piccolino's member of staff was the only one that got the tip and looked genuinely appreciative.

TbizzleSeptember 22nd 2008.

Tips are there to be earned and not to be expected!!!!The rubbish waiter standing there adding the service charge on and screwing up his face when "enough" cash/gratuity (in their eyes) isn't left should take heed and buck up!! Learn your job,do your job and the money will come!!Management taking a cut of staff's tips are just plain immoral and greedy, and this should be against the law. Workers should vote with their feet if at all possible and opt for employment in fairer places. Tipping policy should be outlined in staff induction, leaving them less open to exploitation.

AnonymousSeptember 22nd 2008.

Living Room - perfect example. Moral of the story, don't leave CC tips. Yes, tips are taxable and the tax man will automatically make an assumption but why is an establishment keeping staff tips?

Restaurant patronSeptember 22nd 2008.

As a regular diner at lots of restaurants in Manchester and surounds I fully support all staff and firmly believe that they should keep all tips offered for good service, I always tip in cash and not on a card as this must help to make sure the right staff get what is rightly theirs. I do hope all of you restaurant diners out there will fully support this

ADSeptember 22nd 2008.

anonymous;tips are taxable presumably the 30% deduction is to cover the tax you should be paying on them. The 20% to the kitchen staff you presumably agreed to when you took the job, if the kitchen staff dont get any cash then they should complain as its them being short changed. you also get minimum wage - I know its not alot but its something and the whole point of the campain in there are waiting staff who dont get any minimum wage they have their tips used to make their wage up to minimum and are lucky to get any more.

AnonymousSeptember 22nd 2008.

I think it's time staff of these restaurants get online and name and shame their employers.

AnonymousSeptember 22nd 2008.

I agree wholeheartedly with the sentiment behind this charter; sadly, I think it will fail. It may prick at the conscience of diners for a while but how many of them are realy going to call up HMCR? As a restaurateur, I pay well above minimum wage and staff keep every last penny of their hard-earned tips. Look around at the showy restaurants of Manchester, the footballer and Z-list celeb hang-outs. Check out their tip/service charge policy and next time you dine there, ask if they pay the minimum wage - you'll be surprised at the answer maybe. These are the restaurants that are packed out every night of the week, the restaurants that can afford to pay better wages but alas, fail to do so. I may also add, that some of these establishments are forever being mentioned (advertised??) on this site. ManCon, you need to put your money where your mouth is - last time this subject was discussed on this site, it died an almost isntant death

Tim KSeptember 22nd 2008.

Dined at the River Room recently. Staff there get to keep 100% of cash tips, but are paid a percentage of the credit card tips depending on the current customer satisfaction scores, as measured by survey. Jeez! Isn't the presecence of a tip good enough? In order to give the staff a tip on a card you have to (a) give them the tip (b) fill in a card to say things are good enough for you to tip them.

AnonymousSeptember 22nd 2008.

Sorry I think I misunderstood, did you mean the 30% is for the tax we would pay on our cash tips? Also I agree I am not hard done by where I work. I appreciate there are people in worse situations and hopefully this Charter will change that.

Mr TSeptember 22nd 2008.

Way back in the day I worked in a kitchen. Not sure if this applies everywhere but at that gaff when tips came in they went into a pot, then at the end of the night the head chef got a set %, then the head barman or maître de another set %, and whatever was left was shared out amongst the rest of the staff. Was great on quiet nights cause you'd get loads of money, but when there was a load of staff in you'd barely get a dollar.

AnonymousSeptember 22nd 2008.

I work at the living room on Deansgate. We are paid 5.52 an hour, but get more than 50% of our credit card tips taken away, 30% goes to the company and the rest split, allegedly, between the kitchen staff, but they never see any of it.I work very hard to earn my tips, it is not an easy job, especially at the moment. We are getting less hours because fewer people are eating out so when we do earn tips we should get to keep them.I never expect to be tipped, it is the customer's choice and their own hard earned money at the end of the day. If they want to hand some of that over to me then I am very appreciative.I feel bad for the customers. Not only do they pay over the odds for a meal, but if they tip on their card they are inadvertently giving 30% of that to the company as well.It is a system used company wide so unlikely it will change.The only way round it for us is , if you are leaving a tip, do so in cash. Then you can ensure it goes to your server.

AnonymousSeptember 22nd 2008.

I have no doubt that the post regarding the abuse of tips in Indian restaurants is true - many Chinese restaurants indulge in the same practice. In fact, a lot of Manchester's restaurants act in this way, although to pay £1 per hour is highly unusual, notwithstanding a vile way in which to treat staff. However, as I said before, do the general public really care? Waiting staff are sometimes treated with no respect whatsoever and as long as the customer can say they dinned in the same place as a Coronation Street 'star' or an over-rated, over-paid footalling oik, they're happy. If ManCon realy want to treat this issue seriously, they should start naming and shamimg those restaurants who continue to practice this unethical, yet not illeagal method by which they pay their employees

cping500September 22nd 2008.

The law currently is this: if the restaurant/bar/hotal operates a tronc system with a member of staff as troncmaster (the term is not gendered)then deductions from wages cannot be made for tips distributed. THE TIPS WERE NOT THE PROPERTY OF THE EMPLOYER. That was the system I presume operated by Leanne's employer. The case is HRMCv Annabels (Berkeley Square) Ltd (UKEAT/0562/7/RN) Although it was about the minimum wage the Employment Appeals Tribunal made it clear that tips under this system DID NOT BELONG TO THE EMPLOYER. It might be possible to extend this to tips in general via a case under the Wages Act. I think this is a better way for UNITE than a charter. Legislation much incorporate this principle. Not withstanding this tips are taxable as earning and I am sure.Any hospitality employee who is being paid below the minimum wage because an amount for tips is being deducted in a trnc system should phone the enquiry line for Revenue and Customs (HMRC) and seek advice For diners and boozers just ask if your conscience botheres you and if you like make the call to HRMC.Sometimes it HMRC really does give that receive

FrecklesSeptember 22nd 2008.

I recently dined in Abode and at the end of the meal before paying the bill I asked the waitress if she would recieve all the tip. She explained that she would get 50% at the end of the month and 50% was kept as staff welfare. Upon more questioning I gathered that it was just a rather good ploy on Abodes part to keep 50% of tips. I asked for the 11.5% or 12% service charge to be removed from my bill and paid the tip in cash as I was assured this meant that she would recieve all of it. I think this is quite a common thing to happen and what annoys me more is that discretionary service charges are added to the end of the bill at most restaurants. They know most people would be too shy to ask for it to be removed.

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