Skip to content
Thursday 13 August 2026London --:--Frankfurt --:--Zurich --:--
NewslettersSearchEN · DE
MorningWire

European business, markets and politics

FTSE 100
10,793.12
-0.37%
DAX
26,427.45
+0.37%
CAC 40
8,685.70
+0.12%
STOXX 50
6,561.04
+0.41%
  • Europe
  • Markets
  • Business
  • Economy
  • Technology
  • Politics
  • Opinion
More
GermanyFranceBankingAIEnergyFintechPropertyCapital Markets
  • Germany
  • France
  • Europe
  • Markets
  • Business
  • Economy
  • Technology
  • Politics
  • Opinion
  • DE
Tuesday 02 October 2018 10:27 am  |  Updated:  Tuesday 21 May 2019 4:25 pm

Debate: Given the Tory party’s proposal to ban restaurants from taking a share of staff tips, is regulation necessary?

By: Scott Corfe and Len Shackleton

Add as a preferred source on Google

NULL

Debate: Given the Tory party’s proposal to ban restaurants from taking a share of staff tips, is regulation necessary?

YES  – Scott Corfe is chief economist at the Social Market Foundation.

The rise of the service charge in UK restaurants has led to a great deal of confusion. Often listed as discretionary on bills, many of us – myself included – have assumed that these are essentially tips, going directly to the hard-working waiters and waitresses of our country.

As recent news stories have highlighted, the reality is much less clear-cut, with a number of major restaurant chains called out for withholding some or all service charge fees from staff.

Far from being tips, service charges have become a way for some restaurants to raise more revenue and mask the true costs that they are charging for meals. Quite rightly, diners have been outraged by the deceptive behaviour of these restaurants.

Customers and staff are sick and tired of being duped on this. It should be crystal clear whether service charges are given to staff, many of whom are on low wages. If businesses won’t do that by themselves, there is a strong case for regulation.

NO – Len Shackleton is a professor of economics at Buckingham University.

The practice of tipping varies, particularly around cash and card tips.

In the US, a lower minimum wage in restaurants recognises the substantial addition to basic pay which gratuities often represent. Similarly, average tips were used to justify paying lower UK minimum hourly rates until 2009.

Some restaurants use a tronc system: tips are pooled and back of house staff can share. Arrangements should reflect the mix of staff responsibilities and different types of dining. Pizza Express tips simply reflect front of house service, but at Quat’Saisons they will reflect the quality of the chef’s work.

A government spokesperson didn’t know if there would be any permitted variation in future. Probably not.

The government has once again matched an unconditional Jeremy Corbyn pledge, despite pointless “consultation”, and an industry code of practice which seemed to be working.

It’s yet another constraint on the type of contract that businesses can use, and a further drift towards state regulation of everything we do.

Share this article

  • Facebook
  • X
  • LinkedIn
  • WhatsApp
  • Email

Similarly tagged content:

Sections

  • News

Categories

  • Business
  • Politics
  • Retail

Related Topics

  • Jeremy Corbyn
  • People

Trending Articles

  • Five-star Mayfair hotel hit with HMRC winding-up petition

  • It’s not just Jason Arday, most of sociology is a scam

  • IT consultant ordered to pay £50,000 after being accused of stealing Soho House members’ personal details

  • As it happened: FTSE 100 falls as Iran and US clash over Strait of Hormuz; Oil stockpiles ‘rapidly depleting’

  • As it happened: Stocks jittery as oil nears $90; Trump ‘semi-negotiating’ with Iran

More from Morning Wire

  • Row erupts over Tory plan to stop Soho pub goers standing up 

    Hospitality
    Bustling Soho street scene with vibrant storefronts, diverse pedestrians, and iconic London architecture under clear skies
  • Jamie’s Italian is awful but don’t worry, there are some great new Mediterranean restaurants too

    Life&Style
    Elegant bancone setup in a modern business environment with stylish decor and lighting, highlighting contemporary design e...
  • Burnham’s high street tax plan carries £880m price tag

    Retail
    High streets emptied out as retail sales fell in May.
  • Just Eat takes UK AI ordering tool across Europe

    Tech
    Private equity giant Prosus will acquire Just Eat Takeaway.com
  • Warehouse tax could threaten high street businesses, Burnham warned

    Retail
    Amazon logo on a building, representing the e-commerce giants brand and corporate presence.
  • Rachel Reeves’ legacy of tinkering with the City is not enough, says Mel Stride

    Economics
    Mel Stride addressing an audience at a business conference, standing at a podium with a presentation screen behind him
  • What should sport expect from Andy Burnham and Lisa Nandy?

    Sport Business
    GettyImages 2286323428: Business professionals in a meeting, discussing strategies with charts and laptops.
  • Going on holiday as Prime Minister comes at a cost

    Opinion
    Andy Burnham smiling and holding a pint of beer and a smartphone in a pub setting
MorningWire

Independent European business, markets and political news for decision-makers.

Morning Briefing

Europe

  • Germany
  • France
  • Europe
  • UK & Ireland

Business

  • Markets
  • Banking
  • Technology
  • Energy
  • Property
  • Fintech

Editorial

  • Opinion
  • Editorial Policy
  • Corrections
  • Contact

Company

  • About Morning Wire
  • Privacy Policy
  • Terms of Use
  • Cookie Policy
© 2026 Morning Wire Ltd · Published by Morning Wire Media, Bahnhofstrasse 65, 8001 Zürich, Switzerland
Privacy · Terms · Cookies · Facebook