Is the completely legal use of non-cash tips to top up workers’ National Minimum Wage (NMW) via the tronc simply good business sense?
A practice that allows employers to reward hardworking restaurant staff by making sure they have a little extra in their pockets if they do their jobs well?
Or, as many believe, is it a dishonest and ethically questionable ploy that rips off a loyal workforce to help line owners’ and shareholders’ pockets at a time when the industry is struggling to get good staff?
Well the finance director (FD) of one well known Italian restaurant chain believes the former and described the practice as “a benefit for the team that motivates them”.
Union Unite has a slightly different take on the subject and launched a campaign demanding fair tips in September.
Unite believes the practice to be inherently unfair because it means employees, in effect, take a pay cut when on holiday or off sick regardless of how much extra they earn over the NMW when working.
At present there’s a sort of limbo obscuring the debate as industry and union is waiting on a Revenue appeal.
But where both sides agree whole heartedly is that the beloved tax man has made a pig’s ear of the whole issue so far – after all the publication of guidance a year ago was supposed to have sorted out the long running saga of tips and tonc once and for all – and in the words of the already mentioned FD should “work out what the hell it is doing” about the mess.
Our top tip for the Revenue? Whatever you finally decide to do best avoid the use of discs n the process or the Royal Mail.
Tips can count towards minimum wage, finds tribunal>>