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Restaurants may be banned from taking away staff’s tips

The UK government wants to ban restaurants from keeping some of their employees' tips.

What it means: Bella Italia, Cafe Rouge, Ask and Zizzi’s are all well-known high-street restaurants that pocket 8 to 10 percent of the tips their employees receive. Theresa May and her government think this is bang out of order, and say they’re going to introduce a new law to stop them doing so.

Defenders of the restaurants point out that many are having a hard time making money at the moment and need all the extra cash they can get. Restaurant profits are being squeezed by increases in the national minimum wage (currently £7.83 an hour for people over 25, which is 17 percent higher than it was in 2016), increased competition (not only from other restaurants but from takeaway companies like Deliveroo and UberEats), and less customer spending (basically, we’ve all felt poorer since the financial crisis so we don’t eat out as much).

It can be hard to shed many tears for businesses which once made millions of pounds a year. But staff will lose their jobs if poor profits cause restaurants to close, and some of the confiscated tips are being redistributed to kitchen staff and other low-wage employees that customers don’t see and therefore don’t tip.

For many people, however, there’s just something rather icky about companies taking money away from workers who are usually quite far down the income scale: one-quarter of hospitality workers are on minimum wage, and one-quarter of restaurants, bars and pubs employ staff on zero-hour contracts. Zero-hour contracts mean you’re not guaranteed any hours of work, and have been criticised a lot because people on them are constantly at risk of not being given enough work to pay their bills.

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