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New law will ban hospitality 'service charges' unless cash is going straight to staff

The new law is to give consumers greater clarity as to where their cash is going.

THE GOVERNMENT IS expected to bring in new laws which will put a ban on the hospitality industry imposing a service charge unless that money goes straight to the staff. 

Tánaiste Leo Varadkar said the new Bill will prevent employers from using tips or gratuities to make up basic wages and to “introduce transparency about how tips and service charges are distributed”.

Varadkar said that customers are often kept in the dark about where their service charge cash is actually going and that this Bill was a way of giving the consumer greater clarity. 

“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. 

Minister Damien English will introduce this amendment to the Payments of Wages (Amendment) (Tips and Gratuities) Bill 2022 (the ‘Tips Bill’) in the Seanad this afternoon.

The amendments will rename “mandatory service charges” as “mandatory charges”, and
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.

Any additional charges that are not going to staff, must be explicit, the new law will state. 

Responding to the news, the Restaurants Association of Ireland said the Bill provided much needed transparency for the consumers and employees of all sectors in which tips, gratuities and service charges, and indeed other additional charges are applied.

Its CEO, Adrian Cummins, said: “As an association, we must now question the proposed amendments to the legislation which seek to prescribe to certain sectors of the economy how they may contract for goods and services and what terms can be used.

“We are seeking a meeting with the Tánaiste to discuss the proposals in terms of how it will be operationalised with restaurants & hospitality businesses.”

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    Mute Fergus Murphy
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    Feb 25th 2020, 2:42 PM

    One upon a time. The Coronavirus. The end.

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    Mute Manbackonboard
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    Feb 25th 2020, 2:57 PM

    I knew it. The Journal.ie and RTE are all the one.

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    Mute CJ Stewart
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    Feb 25th 2020, 3:46 PM

    @Manbackonboard: …ahhhh stapppp…. We live in a very independent and accountable society….. How’s me story tell’in so far….

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    Mute Richard Russell
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    Feb 26th 2020, 11:08 AM

    @Manbackonboard: television and the internet gives us a window on the world, so why is the journal associating with the Free speech deniers in rte

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    Mute John Fairclough
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    Feb 25th 2020, 3:47 PM

    Once upon a time, a man asked a woman to marry him. She said no and he lived happily ever after.
    The end.

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    Mute Daff. Myers
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    Feb 26th 2020, 9:52 AM

    @John Fairclough: I think you’ll find she forever more had a clean peaceful house, with no football on the TV, no dirty socks on the floor and lived even more happily ever after than he did.

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    Mute CJ Stewart
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    Feb 25th 2020, 2:55 PM

    It all started on one of those dark dismal days, clouds hung over the sleepy village ,threatening their menace at any minute.. Patrick walked through the deserted main street, up past the old ruins beside Mcgintys pub…”should I go in” he asks himself…the cold wind picking up and whipping the turf smoke from the pub up through the town..”maybe I will, later” …”after I come back down from voting Sinn Fein and pissing off FG and FF ….and RTE…feck them all anyway, they are the best story tellers I’ve ever come across….

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    Mute Luke Lee
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    Feb 25th 2020, 3:07 PM

    My girlfriends 4 foot 9.

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    Mute richiecranium
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    Feb 25th 2020, 3:19 PM

    @Luke Lee: very tall for a 12 year old

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    Mute Ríain HenC
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    Feb 25th 2020, 2:33 PM

    Once upon a time . The End . Sign me up

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    Mute Rachel O' Meara
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    Feb 25th 2020, 2:34 PM

    @Ríain HenC: You forgot the middle bit.

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    Mute Ríain HenC
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    Feb 25th 2020, 2:37 PM

    @Rachel O’ Meara: Damn writers block !

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    Mute Rachel O' Meara
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    Feb 25th 2020, 2:43 PM

    @Ríain HenC: Don’t worry, I hear that happens alot. :)

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    Mute Ríain HenC
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    Feb 25th 2020, 2:47 PM

    @Rachel O’ Meara: Phew ! That’s a relief , thought it was just me ;)

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    Mute Honeybee
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    Feb 25th 2020, 7:41 PM

    This brings me back to a six word story or flash fiction which allowed for a story , the best example of which was “For sale; baby shoes ,never worn”. It is the concept of telling a story in a minimal amount of words.

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    Feb 25th 2020, 2:54 PM

    Stately plump Buck Mulligan blahdy blahdy blah yes I said yes I will yes.

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    Mute Àine Nì Cleìrìgh
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    Feb 25th 2020, 10:43 PM

    My father always told us this story he had to write for school when he was young. It was titled “A day in the bog”. He started “The day was wet and we didn’t go”. Always made me laugh.

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    Feb 25th 2020, 3:15 PM

    It’s raining again, the end.

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