U.K. | New tipping legislation has made it compulsory for restaurants to relay all tips back to staff.
Popular London restaurant chain, Ping Pong, has chosen to ban customer tips from a money card, and has instead introduced an optional 15 percent "brand fee". The fee would go towards franchise fees and other brand-related expenditures and will replace a 12.5 percent service charge, of which 90 percent went to staff.
The fee has come into effect three months before the government's new tipping legislation is established. The legislation will make it compulsory to give all tips to staff.
Parent company, AJT Dimsum, said that staff wages had increased by 19 percent from £10.42 to a minimum of £12.44 an hour, which is £1 above the new legal minimum. AJT Dinsum said that it would match earnings received with service charge distribution. Under the new concept, customers would still be able to leave a cash tip, however, this has been a declining trend. The company added that restaurant teams could potentially earn an additional £1 to £2 an hour in bonuses based on hitting sales targets.
Union leaders have described the move as a slap in the face for workers by offering only £1 above the minimum wage to replace a healthy per-hour tip rate. There have been suggestions that a national campaign run by the Union for fair tips ahead of July would ensure restaurants did not replace the service charge with outrageous policies.
AJT Dimsum said in a statement that the business is very proud of the reputation it has as a good employer and, despite the many recent headwinds it has faced, has acted with integrity and honour, with a high priority placed on employee retention.
The change in law has emerged after reports indicated that businesses had used card-based fees to underpin profits rather than rewarding staff and chefs.
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