Why restaurant bosses need to leave the tip jar alone

With the pandemic raging, and some businesses behaving very badly in response to it, I last year floated the idea of the Golden P45 awards.

This was to be an alternative business awards ceremony for those which had royally cocked things up, modelled on Hollywood’s Golden Raspberries, or Razzies, handed out to rotten movies every year.

It seems we may need a second outing of the ’Fives for the reopening economy. And I already have a couple of potential candidates for the top gong of “Worst Business” for the nominations committee to consider.

The first of those is Byron, a chain of restaurants majoring in fancy burgers, where waiting staff have taken to the media to voice fears that their tips are about to be diverted to increase pay for chefs and maybe even restaurant managers.

The 10 per cent service charge applied to bills is currently shared, with the waiting staff receiving 70 per cent and kitchen workers pocketing the remainder. However, a committee of employees is due to be convened to decide on what this should look like in future. You can understand why this has generated concerns among the staff. You don’t have a panel like that sitting unless you’re looking to change things, although Byron say the process can’t be influenced by anybody in restaurant or Byron management.

It’s well known that chefs are in short supply. Another chain, Wagamama, has complained that it is struggling to find them at a fifth of its sites. One way of attracting new ones is to pay them more. Increasing their share of the tips is a cheeky way of doing that. It’s something Pizza Express has already tried (and generated a furious backlash in response).

Let’s say Byron’s committee decides to boost the share of tips going to the kitchen staff, or even to include another group (such as restaurant managers). This, obviously, robs Peter to pay Paul.

It’s particularly tough on the wait staff, who usually make less than the kitchen staff and may also have to grapple with things such as zero-hours contracts rather than enjoying fixed salaries and hours. (Byron itself says it doesn’t have any zero-hours contracts.)

If Byron or other restaurants want, need, to increase the pay of kitchen staff – and I have no doubt that they could do with the extra money – then there’s an easy way of doing that. They could simply increase the hourly pay of the kitchen staff. Duh. There ought to be room to do that when you’re charging as much as £14 for a burger.

The risk facing any eatery that tries to tinker with tipping is, obviously, that their waiters decide to seek employment at places where they get to keep their service charges. While there may be a shortage of chefs it’s not as if there’s exactly a glut of waiting staff either.

Let’s hope Byron sees sense and we have to withdraw the nomination. Sadly, I don’t think this will kill off the awards because it’s not as if we’re short of potential candidates.

Another, which this column has highlighted before, is Yodel, which faces potential strike action over new truck driver schedules that the GMB says hit previously agreed annual leave. Drivers also feel they should get the same enhancements that the union says have been offered to agency staff.

The ballot closes on September 15, at least for those drivers who haven’t decided to quit with a view to seeking out one of the golden hellos workers in their trade are currently being offered by other employers. Some of them have realised that it might be a good idea to play nice given that this isn’t a buyers’ market.

Has to be on the shortlist, no?

PS I’m hereby extending a public invitation to host the awards to business secretary Kwasi Kwarteng, who, obviously, has the power to address some of these issues with the help of, say, the repeatedly promised (and repeatedly delayed) employment bill. And with legislation to bring some clarity to the vexed issue of tipping, which just keeps creating problems.

It’s really Mr Kwarteng that we have to thank for this year’s awards being needed, given that the responsibility for the current labour shortages, and the supply chain crisis that the examples above are symptoms of, can be laid squarely at the door of him and his colleagues.

A little bird tells me the proposed host might not finish the night empty-handed. He’s a good bet for a lifetime achievement award on behalf of Boris Johnson’s government.

This article was amended on 22 September 2021 to include statements from Byron, notably that it does not have anybody on zero-hours contracts and that no member of management will be able to influence the panel deciding how the service charge and tips will in future be distributed.