Annabel’s owner admits ‘dumb mistake’ after paying managers £70k in bonuses from staff tips
The London venue says it is changing its policy following backlash from workers at the exclusive private members’ club.
Annabel's boss, Richard Caring, has insisted it was a “dumb mistake” to give more than £70,000 in staff pre-Christmas tips to pay managers’ bonuses.
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Staff at the club in Berkeley Square reportedly protested against the decision to reduce their takings from the service charge and hand it to 50 managers as Christmas payouts.
Guests at Annabel’s pay an optional 15% service charge, which goes to staff, and a £3-a-head cover charge that goes to the restaurant.
The Mayfair venue, where a latte costs £6, a cheeseburger £26 and a ribeye steak £125, can collect more than £100,000 in service charges in just one week.
According to staff at the club, visited by celebrities and royals since the 1960s, diners can spend more than £10,000 in an evening at one of their tables.
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One worker said “everyone got mad” when they realised where their share of the service charge takings were going, The Guardian reports.
Around 60 per cent of staff are on zero-hours contracts and paid £12.76 an hour, 5p above the legal minimum wage. One worker said, "Tips are a huge bit of pay. We cannot rely on minimum wage."
The service charge, taken from card payments, is shared between about 280 hospitality workers through a system called a tronc. Businesses do not pay national insurance contributions on service charges and tips, which reduces the bill to HMRC.
A change of legislation in October 2024 means organisations must distribute 100% of service charges and tips to workers transparently, with employees given the right to know "how tips are allocated and distributed".
Following an investigation, Caring admitted a “dumb mistake” had been made and Annabel’s held a series of meetings with workers in late March and April to alleviate concerns. This month, the club shared out an additional £103,000 to reimburse hourly workers in “a gesture of goodwill”.
Caring said: “I believe in openness … Everybody should know what they are getting.” He added that Annabel’s was going to offer 20-hour-a-week contracts before a ban on zero-hours contracts from September.
Caring has recently announced he is selling a majority stake in his hospitality empire, which includes Annabel’s, Harry’s Bar, The Ivy restaurant group and the upmarket eateries Sexy Fish, Scott’s and J Sheekey to Abu Dhabi’s Sheikh Tahnoon bin Zayed al-Nahyan for a reported £1.4bn.
The IWGB union, which has dozens of members from Annabel’s, says staff wanted to be paid at least the independently verified living wage for London of £14.80 an hour.
General secretary, Henry Chango Lopez, said: “The billionaires and A-listers who make up Annabel’s clientele can spend more on a single meal than the club’s [little more than] minimum-wage, zero-hours staff take home in a month.
“For the Annabel’s staff trying to survive in London on just £12.76 an hour, tips aren’t a bonus – they’re the only thing keeping the rent paid.”