Restaurants can count card tips as part of pay, court rules

Four retired waiters have lost their attempt in the European Court of Human Rights to prevent restaurants using tips paid by cheque or credit card as part of the basic staff wage.

Judges in Strasbourg ruled yesterday that the owners of Paradiso e Inferno and Trota Blu in the West End of London had acted fairly by using the tips to pay staff salaries instead of handing them out as additional cash.

Sandro Nerva, an Italian, and Spaniards Jose Pulleiro, Jose Gigirey-Cabo and the late Julio Rodriguez, whose fight was adopted by his brother, Jose Antonio Rodriguez Montega, said the practice had cost them tens of thousands of pounds. The waiters sued the restaurants for breach of contract, arguing that the money was in effect held in trust for them by their employers.

In 1994, the High Court in London ruled that non-cash tips belonged to the employer and could be calculated as part of the basic staff pay, set as an industry standard, and now covered by the £4.10 hourly minimum wage.

The staff took the case to the European Court of Human Rights in Strasbourg in 1997.

But Mr Nerva and Mr Pulleiro, who live in London, and Mr Gigirey-Cabo, who has returned to Spain, were told yesterday there had been no breach of their human right to the protection of property.

The judgment said: "Tips paid in this manner became the property of the employer for the simple reason that the vouchers signed by customers were made out in the employer's name and were cleared through the latter's account."

Afterwards, Mr Nerva, 64, who claimed the policy had cost him £20,000 during the 10 years that he had worked at Paradiso e Inferno, said: "The court has done an injustice not only to us but to all waiting staff."

The men's solicitor, Catherine Scrivens, said she thought the ruling "cannot be right morally even if it is legally accepted". She added: "Historically, this group of workers work 60 to 80 hours per week and long shifts just to earn a liveable wage ... I am sure when most customers leave a credit card tip, they do not envisage that it will subsidise waiters' wages."