National Minimum Wage case re restaurant and bar staff
A recent Court of Appeal case will affect all bar and restaurant owners who employ staff whose earnings only exceed the national minimum wage when tips are taken into account. The case concerned a number of well known London night spots where discretionary service charges or tips were paid by customers using credit cards, debit cards or cheques.
The employers in this case used a tronc scheme to distribute these discretionary service charges to participating employees (usually the waiting and bar staff). The main issue in the case was whether the payment made to employees from the troncmaster could be used in determining whether the employees were paid at least the national minimum wage.
The Court held that the payments were not paid by the employer and therefore do not count as part of employees’ pay for the purposes of the national minimum wage. In this case alone the judgement means that over £125,000 in arrears must be paid by the employers in question to their employees.