Ping Pong, a London dim sum chain with five outlets, has banned card tips and introduced an optional 15% 'brand charge' to cover franchise fees and brand costs, replacing a 12.5% service charge that previously gave 90% to staff. The move comes just three months before new legislation requiring all tips to go to workers takes effect in July.
The company says the charge is a test to avoid raising menu prices, with a final decision expected in June. Parent company AJT Dimsum claims it has increased staff wages by 19% to a minimum of £12.44 an hour, £1 above the legal minimum, to match previous tip earnings. Customers can still leave cash tips, but many no longer carry cash.
Unite union lead organiser Bryan Simpson called the change 'a complete slap in the face' and 'one of the most blatant examples of tips theft'. He argued that customers will assume the 15% charge is a tip for workers, which it is not. The union plans a national campaign for fair tips ahead of July.
AJT Dimsum defended the policy, stating it acts 'with integrity and honour' and that stable wages benefit employees, including improved access to loans and mortgages. However, higher wages may mean higher taxes and National Insurance contributions for staff.
Ping Pong is expected to be one of many restaurants altering charging practices before the new law, which aims to put an estimated £200m more into workers' pockets. Restaurants have expressed concerns about added costs amid high inflation and weak consumer spending.
