Miller & Carter, the steakhouse chain owned by the nationwide pub group Mitchells & Butlers, has been criticised for taking payments from waiting staff worth up to 2% of the sales they serve up, cutting their income during the cost of living crisis.
The payments are intended as a way for waiting staff to share tips with chefs and other back of house workers.
But the Unite union and waiting staff who spoke to the Guardian claim the system can sometimes lead to earnings from tips and service charges being less than the amount owed to fellow workers.
In one case, a worker claimed the amount of cash they had been asked to hand over meant their pay fell below minimum wage on a shift.
The new sharing scheme has been introduced at dozens of Miller & Carter outlets in the past month after local votes by staff on how to share out the service charge as well as cash and card tips.
Not all restaurants have introduced exactly the same policy, but it is understood that a third of the chain’s 124 restaurants now use a percentage of sales to determine tip sharing. The Guardian has seen evidence that votes gave staff in several restaurants only limited options for how to split card tips – all or most of which were a percentage of sales.
Some of the chain’s 100-plus UK restaurants have capped the nightly payout – at between £20 and £40 – but the union says this can still be more than that earned in card tips, putting workers at risk of earning below minimum wage.
Until this month, many waiting staff at the restaurants shared tips with other staff by paying a fixed “plate fee” of less than £10 a shift based on the day and time of their shift, while in some restaurants they shared a percentage of the service charge collected.
Waiting staff claim that paying out a percentage of sales means they will in some cases lose hundreds of pounds a month in income at a time that their household bills are on the rise.
One worker said she was paid less than the minimum wage on a shift because she was asked for cash to meet the payment to other staff not covered by her tips. In other restaurants, the Guardian has seen evidence that the amount owed to other staff was noted down to be paid on a future shift because it could not be covered by tips on the night.
Miller & Carter does not automatically add a service charge to customers’ bills except for tables of eight people or more and many people no longer leave cash tips after a big switch to card payments during the pandemic. Both those factors mean that the level of tips and service charge earned by waiting staff is highly unreliable and not directly linked to sales.
“It just depends what guests you get and so many people leave nothing,” one staff member said. “On a Monday lunch you can earn zero [in tips and service charge] and be in debt to the company.”
The chain is part of the Mitchells & Butlers group, a leading pub operator and member of the FTSE 250 index of blue chip companies, whose stable of brands includes Harvester and All Bar One.
Miller & Carter said in a statement: “Team members have not, and will never be, asked to contribute towards tips from their own remuneration and are always paid at, or above, national minimum wage.”
The company added that there were 70 different variations in how tips were distributed across its estate as “each team, at each individual site, democratically decides on that team’s own tipping distribution policy”.
“Some teams, in different venues, may adopt similar options, but those options are down to each team,” the statement added.
The company added that general managers at the restaurants were “not involved” in the vote or final decisions on how tips were split.
However, the Guardian has seen evidence that staff were given limited options by restaurant managers to vote on, most of which included a percentage of sales.
Unite said these policies won staff votes because waiting staff, who lose out, were being outvoted by kitchen staff and junior management in restaurants – who stand to benefit.
One worker said they had been asked to choose between a percentage of card tips or 1.5% of sales, capped at £30 a day, and understood that both ideas had been suggested by senior management.
She said her team had opted to switch from paying a set fee of less than £10 a shift to a percentage of sales. This meant she would now have to give back almost £400 more a month in tips – leaving her with as little as £100 in tips to top up her basic pay which is less than £1,500 a month.
“It is all very horrible. Not just a horrible atmosphere at the meeting but because the front of house staff were thinking: ‘How are we going to cope?’ I came home and cried,” she said.
Another member of staff estimated she would lose out by as much as £300 or more a month by the switch from a set fee to a percentage of sales and was now worried about paying her rent and credit card bill.
More than one worker said they and their colleagues were afraid of challenging the system as they had been threatened with disciplinary action for speaking out and were afraid to lose their jobs.
Bryan Simpson, the lead organiser for hospitality workers at Unite, said: “This is one of the worst tips policies we’ve ever come across because it forces low-paid workers to find tips that can never be guaranteed.
“Our members are already losing hundreds in lost income. There is a strongly held fear among our members that they will be brought below the minimum wage by this system.
“Put simply, this is an undemocratic and unworkable policy, which is designed to force low-paid waiters to make up for the failure of the company to pay their kitchen, bar and junior management enough.”
