Steakhouse chain cuts waiters’ tips, with staff warning they’ll lose up to £600 a month
Bosses have written to waiting staff to inform them that their slice of the service pie will be reduced to between 25.45 and 29.4 per cent.
Waiters at a swanky restaurant chain claim they will lose up to "£600 a month" after bosses told them their tips would be slashed.
Listen to this article
Waiting staff at Argentinian steakhouse Gaucho had originally received 37 per cent of a table's service charge, a discretionary fee added to customer bills as a thank you for service.
However, bosses have now written to these workers to inform them that their slice of the service pie will be reduced to between 25.45 and 29.4 per cent.
Read more: Largest-ever crackdown on shoplifting gangs sees thousands of items recovered by Met Police
The cut is already a reduction from the 45 per cent waiters earned from the service charge early last year.
Bar staff across the brand's 20 UK outlets - 12 of which are in London - will also feel the impact of the cutbacks, receiving 17 per cent of the service charge, down from 20 per year during the same period.
The announcement was made in a letter sent by Gaucho’s Troncmaster, a company called WMT Troncmaster, which manages the payment of service charge to staff.
It told employees that the service charge collected at tables would be shared differently from October 1.
The restaurant group automatically adds a service charge of between 12.5% and 13% to customers’ bills, although they can opt not to pay it.
The letter, first seen by the Guardian, read: "The Troncmaster strongly believes that service charges are paid by customers in respect of their whole experience, and that all team members who play a part and impact on that experience should participate in, and receive a share of, the tronc funds."
Gaucho's waiting staff said they have not been consulted about the changes and claimed they could individually lose out on between "£300 and £600 a month" as a result.
They added that they rely on the service charge as a major part of their pay, as they all earn the legal minimum wage.
Gaucho, which charges up to £65.60 for a steak, says its new system is fully compliant with the law.
Legislation past in October states employers in Britain must share out 100% of service charges collected in a venue to workers there.
A spokesperson for Gaucho said: "The new tronc distribution has been set by the independent troncmaster following industry benchmarking across our Gaucho employees.
"The new distribution takes into consideration all our front- and back-of-house colleagues. It is an equitable solution for all of our excellent people. The employee costs borne by the Gaucho business remain as before and the business itself does not benefit in any way from the amended tronc system."
But industry experts have questioned whether Gaucho's "terrible policy" meets the current rules.
In October, employers were told service charges must be done in a “fair and transparent manner” and employees have the right to know “how tips are allocated and distributed”.
Bryan Simpson, the national lead on hospitality for the Unite union, said the restaurant group's changes were "not fair or transparent according to the [government backed] code of practice, or there workers".
"The result for low-paid workers in the most expensive city in the world? That waiters may only receive as little as 28% of the tips that they received on their tables … with more than 70% going elsewhere," he said.