An appetite for fair tips

We are spoilt for choice when it comes to eating out in Brighton and Hove – there are over two thousand restaurants and pubs which serve food after all.

We usually rate our visit by the quality of the food and drink that we are served but, too often, we take the service for granted and often only react if it is poor. When it is good, which it usually is, we assume that the waiting (and kitchen) staff get their just reward from their share of the service charge which is now included in most restaurant bills. But this is not always the case – hence my delight at the inclusion of a ‘Fair Tips Bill’ in the Queen’s Speech on 14th October.

Most of the several thousand staff who are employed in local restaurants are on the National Living/Minimum Wage. In Hove, their average annual earnings are £18,439 which is 20% below the national average. Far too often, tips which are intended as a reward for service are being used to bring individual staff salaries up to Living/Minimum Wage levels, simply to meet employers’ legal obligations. As a result, staff end up with exactly the proscribed levels of pay with nothing extra to recognise performance. To add insult to injury, they have to pay a higher rate of tax than would be the case if their tips were handled separately.

From my own personal experience in the industry of honey production and supply to numerous local restaurants, I know that the hospitality industry is indeed fragile and many establishments struggle to make ends meet. But the system needs to change so that staff can be rewarded and customers have confidence when tipping (they may well tip more if they did).

I am glad to say that some Hove restaurants are already shining. Etch on Church Road, for example, guarantees that all tips benefit staff; not the company nor its directors. Additionally, staff are provided with free lunch and drinks daily. The restaurant also provides a range of other fringe benefits to help develop skills and talent and arranges staff shifts to allow a good home/work balance. The Ginger Group has its own system for handling tips, which is completely transparent to staff, and ultimately results in many staff members receiving somewhat in excess of minimum proscribed levels.

I recognise that there are many other catering establishments which treat their staff fairly but cannot afford to provide such a wide range of benefits. But all, regardless of size and turnover, have an obligation to be transparent and, ultimately, fair.

There have been previous attempts to create a fair deal for hospitality industry staff by promoting codes and charters of best practice. Unfortunately, these have not been successful and fell by the wayside as they were not legally enforceable. The Queen’s Speech on 14th October, therefore, included a proposal for a ‘Fair Tips Bill’ to close the loopholes to stop employers from using tips just to top wages up to minimum levels.

Clear and transparent rules governing tipping will stop any exploitation of over one million workers in the hospitality industry in the UK. Such a system would also reassure customers that both service charge and/or any additional tips will reach their intended beneficiaries.

I have no doubt that customers who see staff treated well are much more likely to return so it could be a win: win.

Cllr Robert Nemeth

Conservative Parliamentary Candidate for Hove & Portslade