Quote:
Originally Posted by knobby109
They have a crazy system of tipping in bars-order a beer and a tip is normal! Try to get bar staff in this country to accept a tip for such a small service!
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I have never yet been to the United States, even though I have friends and relatives there, so I can only repeat what I have heard. Tipping is far more widespread and usual there than in Britain. This reflects extremely poor remuneration in the service industries, even by the skin-flint standards of the UK: waiters etc would starve if they were expected to survive only on their official remuneration.
In the UK, restaurant staff are notoriously ill-paid and tips are commonplace due to this, just as in America. Our income tax laws recognise this. Many restaurants operate a '
'tronk'' system: a tronc is a special pay arrangement used to distribute tips, gratuities and service charges where these are collected by the employer rather than given directly to the employee. The point of a tronc is that somone who is
not the employer allocates the tips, so therefore they are seperate from the employer's pay/compensation arrangements. This means the staff still pay income tax, and this is put through the Pay As You Earn system, just like regular employees taxation. But since the tronc is not part of the staff's regular pay, it does not suffer Employees National Insurance Contributions, potentially saving the employee, which could save him/her 11%. The employer is also spared an Employer's National Insurance Contribution at 12.8%. So both parties have an interest in operating a tronc system correctly.
Until October 2009, it was common for employers to treat staff income from troncs are part of the National Minimum Wage, and take it off their regular pay. This was, of course, a flagrant abuse. Since 1st October 2009 it is illegal for employers to do this.
I have no idea whether special tax arrangements apply to tips, gratuities and service charges in America.