Tánaiste Leo Varadkar revealed today that there will be a ban on the hospitality industry imposing a service charge unless that money goes straight to the staff. 

Tipping in Ireland has been the subject of much debate in recent years. The proposed new legislation will put tips back in the hands of the staff who work for them. The law was first discussed in January of this year in response to the worsening hospitality staffing crises.

Tips have been the subject of public attention on and off for a few years. Protests at the Ivy restaurant on Dublin’s Dawson Street added to media coverage of the subject. They started a public debate which has brought about these proposed changes to the law.

Currently

Currently, in Ireland, it’s normal practice to tip the waiter – either in cash or by card. If you eat out in groups larger than five it is standard practice for restaurants to apply a “service charge” on top of the bill instead. A sort of obligatory tip. Customers could be forgiven for assuming that these gratuities or service charges go to the staff who served them. Mostly they don’t.

Bigger places like Hard Rock Cafe in Dublin’s Temple Bar, and restaurants by Irish celebrity chef restaurants you’d think would know better net some of these tips for not only the much more will paid managerial staff but also for the proprietor. And as anyone who has watched Gilmore Girls knows it is not customary to ‘tip’ the proprietor.

The new law will state that any additional charges that are not going to staff, must be explicit. Which should fix this issue.

Tipping Culture

Tipping culture has always been problematic. But Tipping out the bar and the kitchen staff has always been par for the course. It’s important to remember that many servers are on minimum wage whereas chefs and high-end bar tenders are demonstratively not. Also, tips typically depend more on the wait staff’s ability to put up with sometimes flagrantly sexist vulgarity with a smile.

Some well-known chain restaurants in Ireland keep all the tips for their minimum wage burger servers and use them to pay for their Christmas parties. I once got a seven hundred euro tip from a small but demanding party of wealthy well-knowns. But at the end of the week came away with the same hundred odd quid I did every week.

What the ban will do

This new bill will ban employers from describing a charge applied to customers as a “service charge” unless those payments are treated by the employer in the same way as electronic tips or gratuities.

Varadkar said this Bill will prevent employers from using tips or gratuities to make up basic wages. He added that it will help to “introduce transparency about how tips and service charges are distributed”.

“Voluntary services charges are clearly the same as a tip or a gratuity but by definition, mandatory service charges are not. As things stand, you’re expected to pay, without any information on where the money goes. I’m happy we’ve been able to come up with a solution now, which will effectively ban employers from using the term ‘service charge’ or any similar term unless the money goes straight to staff.” Varadkar explained. 

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