According to The Guardian, staff at Harrods plan to write to the conciliation service Acas as a first step towards an employment tribunal case backed by the United Voices of the World union over the handling of the £1 cover charge levied in its restaurants.
Alice Howick, a member of Harrods waiting staff and a United Voices of the World member, told the Guardian: “We are arguing that the cover charge is a kind of service charge in that it is an extra amount added to the customer’s bill before it is presented to the customer. At the moment, all the revenue made from the cover charge is going directly to the company, but we believe it should be going to the employees.”
According to The Guardian, Unite union is also considering legal action against businesses levying a cover charge that they did not pass on to workers.
Earlier this year, a new law that requires businesses to ‘pass on 100% of tips and service charges to staff’ came into force.
The implementation of the Employment (Allocation of Tips) Act 2023, which was first brought forward back in 2021 and received Royal Assent in May last year, means it is now unlawful for businesses to hold back service charges from their employees, ensuring staff receive all of the tips they have earned.
If an employer breaks the law and retains tips, a worker will be able to bring a claim to an employment tribunal. Employers in the wrong could be made to pay fines or compensation to staff.
A statutory code of practise on the fair and transparent distribution of tips, which will have legal effect under the Employment (Allocation of Tips) Act, was set out by the previous Conservative government back in April.
As outlined in the code, the act and secondary legislation applies to England, Scotland and Wales, and ‘aims to increase fairness in tipping practices and create a level playing eld for employers who already allocate all tips to workers by ensuring that all employers follow the same rules’.
