Outcry from UKHospitality as Government confirms furloughed workers will not be entitled to tronc

By James McAllister

- Last updated on GMT

Outcry from UKHospitality as Government confirms furloughed workers will not be entitled to tronc

Related tags: ukhospitality, Coronavirus, Government

Updated guidance regarding the Coronavirus Job Retention Scheme says workers will not be entitled to tip payments while they are furloughed, which has led to an outcry from trade body UKHospitality.

The Government guidance previously stated​ that employers could claim a grant through HMRC to cover 80% of an employee’s regular wage up to £2,500 per month, but that “fees, commission and bonuses should not be included”.

Details regarding whether employers should have included tronc payments when calculating the 80% was unclear at the time.  

However, having been updated at the weekend, the guidance now says​ employers can claim for any regular payments they are obliged to pay their employees including “wages, past overtime, fees and compulsory commission payments”, but that “discretionary bonus (including tips) and commission payments and non-cash payments should be excluded”.

A spokesperson for HMRC has confirmed to BigHospitality ​that tronc, ​as a method of paying tips, isn’t eligible for the scheme.

In response, UKHospitality has urged the Government to reconsider its decision to exclude tronc payments under the scheme. 

“It is incredibly disappointing that the Government has seen fit to exclude tronc payments from people’s earnings,” says UKHospitality chief executive Kate Nicholls. 

“HMRC will have evidence that employees are paid tips through a tronc, so there seems no reason not to include it in the Job Retention Scheme.

“This is taxable income that team members have earned. Excluding it from the scheme means that furloughed employees will receive less money to see them through this crisis. Money they should be entitled to.

“Hospitality businesses are doing their best to support employees during extraordinarily difficult times. But with zero revenue and persistent demands on cash from landlords and others, there is only so much they can do. Including tronc payments in the Job Retention Scheme would give more people some much-needed support, and we hope the Government reconsiders.”

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