Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

London restaurant chain faces criticism as it replaces card tips with ‘Brand Charge’ amid pending law changes

by April 5, 2024
April 5, 2024
London restaurant chain faces criticism as it replaces card tips with ‘Brand Charge’ amid pending law changes

A London restaurant chain has stirred debate by banning customers from tipping via card and introducing a “brand” fee instead, only three months prior to the enforcement of legislation mandating the allocation of all tips to staff.

Ping Pong, which runs five dim sum establishments in the capital, announced that the new optional 15% charge would contribute towards “franchise fees and other brand-related expenses,” supplanting a 12.5% service charge, 90% of which previously went to staff.

The company explained that the initiative is being trialed as an alternative to raising menu prices, promising to consider all constructive feedback before finalizing its decision in June. At that juncture, Ping Pong will determine whether to make the fee compulsory, adjust product prices, or adopt a combination of both strategies.

AJT Dimsum, the chain’s parent company, disclosed a 19% increase in staff wages from £10.42 to a minimum of £12.44 per hour – £1 above the forthcoming legal minimum. They asserted that this adjustment would “equivalent the earnings they would have received through service charge distribution.” Notably, patrons will still have the option to leave a cash tip, although the prevalence of cashless transactions may impede this practice.

Moreover, restaurant teams stand to earn an additional £1 or £2 per hour in bonuses contingent on meeting sales targets.

Bryan Simpson, the lead organiser for hospitality at the Unite union, condemned the wage adjustment, describing the offer of just £1 above the minimum wage as “a complete slap in the face” for workers.

“Ping Pong’s decision to effectively deny workers tips by cynically changing the service charge to a ‘brand charge’ to evade the forthcoming fair tips legislation is one of the most blatant examples of tips theft we’ve encountered,” Simpson asserted.

He added, “Regardless of the label senior management affixes to it, customers will assume that this 15% constitutes a tip intended for workers, which is disingenuous.”

In response, the union announced plans for a national campaign advocating for fair tips before the legislation takes effect in July, aiming to prevent restaurants from adopting “outrageous policies” in lieu of service charges.

AJT Dimsum defended its position, stating, “The business takes pride in its reputation as a responsible employer and, despite recent challenges, has acted with integrity and prioritised employee retention. Enhanced wages will provide stability throughout the year, mitigating the effects of seasonality and facilitating improved access to financial products such as loans and mortgages.”

However, the shift towards additional wages, rather than bonuses funded through service charges, may result in higher taxes for employees initially due to national insurance contributions. Yet, it could lead to potentially better pension benefits in the long run.

Ping Pong’s decision is likely to be just one of several adaptations by restaurants ahead of the impending legislation, which aims to ensure that all service charge funds and tips are distributed to workers.

The government anticipates that this measure will inject an estimated £200 million more into workers’ earnings. Nevertheless, restaurants express concerns that it will amplify costs amidst high inflation and subdued consumer spending.

Read more:
London restaurant chain faces criticism as it replaces card tips with ‘Brand Charge’ amid pending law changes

0
FacebookTwitterGoogle +Pinterest
previous post
Government and Ofgem act to rein in unscrupulous energy brokers to ‘empower’ UK SMEs
next post
The Evolution of Electric Vehicles

You may also like

5 Key takeaways from ‘happy healthy wealthy entrepreneurs’

November 14, 2022

FCA to investigate the treatment of PEPs by...

September 6, 2023

Comparing online and land-based casino industries

September 12, 2022

NatWest to Acquire Sainsbury’s Banking Operations

June 20, 2024

Markets rally as US court blocks Trump tariffs,...

May 29, 2025

UK interest rates remain at 16-year high of...

May 9, 2024

Farmers threaten to quit NFU as leader backs...

September 27, 2022

Breaking down stereotypes: Why Apprenticeships are good for...

April 6, 2023

Why I’m Supporting British Farmers Against Ill-Thought-Out Inheritance...

November 17, 2024

Amazon facing £900m payout to shoppers over online...

October 20, 2022

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Call with China’s Xi, and Trump-Musk exchange fueled barbs during 20th week in office

      June 7, 2025
    • Trump’s conservative allies warn Congress faces critical ‘test’ with $9.4B spending cut proposal

      June 7, 2025
    • Tech ETFs are Leading Since April, but Another Group is Leading YTD

      June 7, 2025
    • TIMELINE: Inside the evolving relationship between Trump and Musk from first term to this week’s fallout

      June 7, 2025
    • Deadly drone wars are already here and the US is horribly unprepared

      June 7, 2025
    • Week Ahead: NIFTY’s Behavior Against This Level Crucial As The Index Looks At Potential Resumption Of An Upmove

      June 7, 2025

    Categories

    • Business (8,152)
    • Investing (2,019)
    • Politics (15,564)
    • Stocks (3,136)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved