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Harrods workers say company keeps up to 75% of restaurant service charge Harrods keeps up to 75% of restaurant service charge, union says
(35 minutes later)
Harrods is being accused of shortchanging its restaurant staff in the latest row over how service charges added to diners’ bills are shared among staff. Harrods has been accused of shortchanging its restaurant staff in the latest row over how service charges added to diners’ bills are shared among workers.
The union representing Harrods waiters and kitchen staff believes the Qatari owner of the upmarket London department store retains up to 75% of the service charge, a situation it claims reduces the pay of waiting and kitchen staff by up to £5,000 a year. The union representing Harrods waiters and kitchen staff believes the Qatari owner of the upmarket London department store retains up to 75% of the service charge, a situation it says reduces theirby up to £5,000 a year.
The United Voices of the World union (UVW) says an unspecified percentage of the service charge collected in Harrods’ 16 company-run cafes and restaurants is shared among the 483 kitchen and waiting staff. It is organising a demonstration outside the Knightsbridge department store on Saturday as part of a call for greater transparency. The United Voices of the World union (UVW) says an unspecified percentage of the service charge collected at Harrods’ 16 cafes and restaurants is shared among the 483 kitchen and waiting staff. It is organising a demonstration outside the Knightsbridge department store on Saturday as part of a call for greater transparency.
A Harrods spokeswoman confirmed that, like many businesses in the hospitality sector, the company operated a “tronc” system, whereby the service charge is shared out – but only if they accept a cut in basic pay. A Harrods spokeswoman confirmed that, like many businesses in the hospitality sector, the company operated a “tronc” system, whereby the service charge is shared out, but only if staff accept a cut in basic pay.
“Harrods is taking steps to improve the current system through which it distributes its service charge, to ensure it best serves our employees and is completing a detailed review into the existing scheme,” the spokeswoman added. “Harrods is taking steps to improve the current system through which it distributes its service charge, to ensure it best serves our employees and is completing a detailed review into the existing scheme,” she said.
“As this is an ongoing review, we are unable to provide further details on the distribution. However, employees will be informed of the details of the new system as soon as the review is complete.”“As this is an ongoing review, we are unable to provide further details on the distribution. However, employees will be informed of the details of the new system as soon as the review is complete.”
Petros Elia, UVW general secretary, said: “Customers expect the service charge to go to staff and that’s where it should go. If Harrods feels the need to retain a percentage they should explain why.” Petros Elia, the UVW general secretary, said: “Customers expect the service charge to go to staff and that’s where it should go. If Harrods feels the need to retain a percentage they should explain why.”
What happens to the cash generated by the service charge applied to bar and restaurant bills has become a moot point. The TV chef Michel Roux Jr admitted in December that his Michelin-starred restaurant Le Gavroche classed service charge income as revenue rather than a tips jar to be shared among staff. He has since said the restaurant would scrap the charge from the end of January. What happens to the cash generated by the service charge applied to bar and restaurant bills has become a moot point. The TV chef Michel Roux Jr admitted in December that his Michelin-starred restaurant Le Gavroche classed service charge income as revenue rather than tips to be shared among staff. He has since said the restaurant would scrap the charge from the end of January.
The chef also apologised following a Guardian report in November that exposed how Roux was paying some of his staff less than the minimum wage at his Mayfair restaurant, where the menu includes starters costing as much as £62.80 for lobster mousse with caviar and champagne sauce. The chef also apologised following a Guardian report in November which revealed that Roux was paying some of his staff less than the minimum wage at his Mayfair restaurant, where the menu includes starters costing as much as £62.80 for lobster mousse with caviar and champagne sauce.
Fortnum & Mason, another high-end London department store, is also trying to persuade staff at its Heathrow bar to move over to a tronc system.Fortnum & Mason does not currently distribute any of the 12.5% service charge collected on drinkers’ bills at Heathrow.Fortnum & Mason, another high-end London department store, is also trying to persuade staff at its Heathrow bar to move over to a tronc system.Fortnum & Mason does not currently distribute any of the 12.5% service charge collected on drinkers’ bills at Heathrow.
Accounts filed at Companies House show that Harrods’ owner, Qatar Holding – the investment arm of Qatar’s sovereign wealth fund that acquired the store from Mohamed Al Fayed in 2010 for an estimated £1.5bn – paid itself a £100.1m dividend in 2016. Accounts filed at Companies House show that Harrods’ owner, Qatar Holding – the investment arm of the country’s sovereign wealth fund that acquired the store from Mohamed Al Fayed in 2010 for an estimated £1.5bn – paid itself a £100.1m dividend in 2016.
That followed a record year in which pre-tax profits increased 19% to £168m. Sales rose 4% to £1.4bn in the year to 30 January 2016. The highest-paid director, presumed to be its managing director, Michael Ward, earned £1.6m.That followed a record year in which pre-tax profits increased 19% to £168m. Sales rose 4% to £1.4bn in the year to 30 January 2016. The highest-paid director, presumed to be its managing director, Michael Ward, earned £1.6m.
The retailer attracts high-spending overseas tourists and Ward told the Guardian that it had been insulated from the economic gloom emerging in the UK since the Brexit vote.The retailer attracts high-spending overseas tourists and Ward told the Guardian that it had been insulated from the economic gloom emerging in the UK since the Brexit vote.
“Christmas has been particularly strong this year,” he said, pointing to solid demand for bags, shoes and diamonds, with Yves Saint Laurent and Gucci among the most popular brands.“Christmas has been particularly strong this year,” he said, pointing to solid demand for bags, shoes and diamonds, with Yves Saint Laurent and Gucci among the most popular brands.
“The top end of the market is always less affected than anyone else. The second [factor why Harrods is protected from Brexit] is to an extent London is a bit of a bubble in the UK. So from our perspective we’ve got great local customers plus we’ve seen more international customers come to London.” “The top end of the market is always less affected than anyone else … from our perspective we’ve got great local customers plus we’ve seen more international customers come to London.”
Qatar’s sovereign wealth fund, the Qatar Investment Authority, was founded in 2005 to help the Gulf state strengthen its economy by investing its oil and gas riches in other assets.Qatar’s sovereign wealth fund, the Qatar Investment Authority, was founded in 2005 to help the Gulf state strengthen its economy by investing its oil and gas riches in other assets.