Cote, the BC Partners-backed restaurant chain, has strongly refuted criticism that it is retaining the entire service charge it automatically adds to bills rather than giving it to staff as tips.
A report by the Evening Standard said that campaigners had accused the company of “misleading” customers with its “outrageous” policy that the 12.5% charge goes straight to the company instead of being kept by workers at the restaurant where The Diner ate
However, a spokesperson for Cote said: “We can confirm that, contrary to recent press reports, Cote distributes the service charge income to the restaurant level employees at which the service charge was collected. The individual restaurant manager allocates the service charge across all restaurant level employees, as we believe it is important to recognise those preparing the food or cleaning the kitchen, in addition to the front of house staff.
“This service charge element of compensation is always paid in addition to a base amount which is at least equal to the national minimum wage. It is paid through the payroll, net of taxes and NI. As such, the company does not recognise the service charge as revenues in its accounts.
“Company policy is that where customers leave a cash tip, it is at the waiters’ discretion to keep it for themselves or to include it in a general pot with other members of staff. Any deviation from this policy will be investigated and disciplinary action taken where appropriate.”
Business Secretary Sajid Javid said the government would be examining the issue. He said: “While it would not be appropriate to comment on this individual case, as far as I’m concerned, tips belong to the staff. I’m getting increasingly concerned about the practice of some restaurants, and will be taking a serious look into the issues raised.”
Earlier this month, the Unite union called on PizzaExpress to drop an 8% administration fee taken from credit card tips.
The union planned a series of demonstrations outside PizzaExpress restaurants and produced a letter apparently written to chief executive Richard Hodgson from a member of staff, complaining that the fee costs her £3 a night.
