Legislation Is Needed To Protect The Wages And Tips Of Those In The Hospitality Industry

Brexit is like the Japanese knotweed of British politics – invading all the legislative room available, and so starving attention for anything else. Whatever you may feel about the success or otherwise of the Government’s negotiations in Brussels about ‘taking back control’, it is ironic that one of the consequences is that Westminster could become impotent – whatever the final deal, Britain has too many domestic challenges that deserve attention. One such pressing issue is low pay. Whilst employment rates may be high, Britain hasn’t had a pay rise in nearly a decade. Nearly a quarter of all employees in Britain now earn less than the living wage, as rising inflation has hit their pockets. Tackling this isn’t just about improving productivity, and dealing with the consequences of Brexit for growth. It’s also about making sure cash strapped employees can’t be exploited by contemptible employers.

One such group who must be feeling as though the Government have forgotten them are those in the hospitality industry. Waiting staff are some of Britain’s worst paid employees, topping the ONS list of low paid staff in the country with an average wage of just £12,500. When wages are so far from the minimum wage, tips become vital to many to keep the wolf from the door. Yet whilst the law was changed to stop employers using tips to top up wages, there’s widespread evidence many still see this as a source of income for the taking.

There are many different examples – including employers who use ‘tronc’ systems to manage tips, but in the process are exploiting these systems to avoid paying national insurance and cut pay. Other companies have been found deducting 3% of a waiters total takings for an evening to cover their training and recruitment costs and using tips to justify this, and many charge staff up to 20% or more to administer tips via electronic card payments. When you’re earning so little to begin with, these behaviours add insult to injury – in my own community I’ve been working with both the GMB Union and Unite Union to hold employers like Turtle Bay to account, but they are just the tip of the iceberg. We need legislation to protect workers from having their tips ‘dipped’ and to ensure that when you pay a service charge, it truly goes to those who serve you.

We had thought the Government agreed, as in May 2016 they launched a consultation on this subject – yet 18 months on even the results of this are yet to be published. This followed their own evidence that their voluntary code on the fair treatment of waiters and hospitality staff was being ignored by employers, leaving staff vulnerable to being mistreated. I’ve asked the Government on the record about this unprecedented delay only to get given the brush off. For the thousands of people who work in service industries kicking this into the long grass is not an affordable option.

That’s why this week in the Finance Bill going through parliament I’ve tabled amendments to force the Government to come clean on what they’re going to do. Requiring employers to set out just what they have collected for employees through electronic payment systems will help expose who is skimming money from their staff and who is treating them fairly. It’s a start towards finally giving these employees the protection they deserve from poor practices in their workplaces- whether major restaurant chains or hotels and bars. If the Government won’t enact this simple proposal then they need to give us the timetable for when they will act on the outcomes of the delayed consultation to help prevent waiters and waitresses from being ripped off.

Brexit may be overwhelming, but those giving us good service in bars, restaurants and hotels need us to give them good service in parliament and get on and sort these problems. In the meantime, best to leave cash if you want to be confident those who waited on you were able to benefit from your gratuity, or if you do use the electronic system always ask to make sure their employer won’t be seeking to take a commission first. Those tips about how to support the low paid come free of charge.