Welfare Reform on the Web (December 2010): Minimum Wage - UK

Coalition shelves plans to ensure restaurants pay staff their tips

A. Grice

The Independent, Nov. 25th 2010, p. 24

Restaurants have been accused yesterday of exploiting a loop hole in a new law designed to ensure their staff receive tips left by customers. In 2008, as a result of the fair tip campaign, the government banned employers from counting tips towards the national minimum wage. Unions say that workers in big chains are being charged administration fees of between 8 and 14% on their weekly tip income. Other restaurants have used the law to avoid paying national insurance contributions on tips.