Service charge was first introduced many years ago to recompense
our casual staff for parties. A party of say 20 requires a much higher
staffing level and is less cost effective than say 5 tables of 4 diners. In
addition, during the 80s and early 90s, at weekends tables were often
used 2 and sometimes 3 times whereas a large party of 20 would tie up
the front restaurant as a single sitting for the evening.
When the National Minimum Wage was introduced in 1999 we were
faced with a financial shortfall. For many years prior to the NMW the
standard catering wage package was £3 per hour plus tips. In 2007 the
NMW was increased to £5.52 per hour. We had to reduce our wage bill
and at the same time hang on to our casual staff. Our solution was to
introduce a flexible shift finishing time but with a guaranteed minimum 3
hour shift. From 9pm onwards if the restaurant is empty with no late
bookings we pay the staff off and close. On the other hand if we still
have diners the staff will stay until they have finished. From a 6.30pm
evening start if we close at 9pm staff will still be paid for 3 hours as if
they have worked until 9.30pm.
In order to recompense staff for this feast and famine scenario we
introduced a 10% service charge across the board to be divided weekly
between our casual staff pro rata to the number of hours worked. Tips on
the other hand are divided by casual staff at the end of each shift.
