A Conservative MP has tabled a bill that would prevent restaurants from deducting or taking tips from staff. Dean Russell, MP for Watford, has tabled “The Tipping Bill,” which is a “Bill to prohibit employers retaining tips and gratuities intended for staff; to make provision about the division of tips and gratuities between staff; and for connected purposes.
With the text of the bill not expected until August — September, many of its key tenets, and therefore how effective it will actually be for workers, remain unclear. If it did not cover “service charge” — the payment, often between 10 and 12.5 percent of the bill, which is labelled as discretionary but frequently makes up a substantial proportion of waiters’ wages and is not really a tip, it would likely be close to ineffective. Service charge and tronc, the sharing system which many restaurants operate for those service charges, have been under scrutiny since the start of the pandemic because furlough payments do not take them into account, leaving many restaurant workers not on 80 percent of their wages — as chancellor Rishi Sunak’s scheme trumpets — but more like 60, 50, or even 45.
Some London restaurants have responded to this by scrapping “service charge” altogether, and pricing the deficit into their menus. This makes a “tip” actually a tip — a bonus that should go to staff who are already being remunerated appropriately, where service charge, despite being perceived as a bonus, has for a long time been a constituent part of a liveable salary that restaurant and bar workers would not survive without. What’s more, the reliance on service charges and tips to provide adequate income creates a variable wage pattern, whereby traditionally busy periods and party season bring in more money and quieter weeknights much less.
Michelin-starred Shoreditch restaurant Leroy followed near-neighbour Oklava and Broadway Market’s Hill and Szrok in making the change, and has since spearheaded the Service Included online campaign to make the practice better understood and more widespread. While some restaurateurs say that making such a change is too risky at a time of continual uncertainty for hospitality — yet to know if it can fully reopen by mid-July — these operators feel that if there was ever a time to reset, it is now.
Tipping has always been a shady subject in London restaurants, and Michel Roux Jr’s Le Gavroche is far from the only one, if the highest-profile, to have taken that “service charge” as revenue and denied it to staff. The government has also repeatedly pledged to provide legislation on the subject, but it has, repeatedly, failed to introduce it. This new bill’s intention, it is clear, is to prevent that from happening — but whether or not it can do so effectively will depend on exactly which charges it polices, and how. More soon.