GWU warns against service charge being used to cover part of workers’ wages

9 Sep 2026 - Economy | Home | Hospitality and Food | News | Politics | Sections | Trade

The General Workers’ Union (GWU) has expressed serious concern and clear opposition to the idea of making a service charge part of the employment conditions of workers in the catering and hospitality sector. The Union’s position follows an increase in reports in recent weeks of restaurants and other food establishments adding an additional 10% fee, known as a service charge, to customers’ bills.

The GWU believes that any change affecting workers’ income must be based on the principles of fairness, transparency and respect for both workers and consumers. The introduction of a mandatory service charge therefore raises a number of important questions which, so far, remain unanswered.

The Union stresses that wages, working conditions and employment-related benefits must remain the direct responsibility of employers and should not depend on additional charges imposed on customers. The GWU opposes any system whereby workers’ remuneration becomes dependent on a mandatory charge paid by consumers rather than on fair wages and stable working conditions.

From a consumer perspective, the GWU believes that the introduction of a service charge would effectively amount to an indirect increase in prices. In practice, customers would not only pay for the food and drinks they consume, but would also face an additional charge that could place further pressure on household budgets, particularly at a time when many people are already facing economic pressures.

In this context, the GWU is also questioning whether the introduction of a service charge could affect the practice of tipping workers directly. If customers see a mandatory service charge included in their bill, they may assume that workers are already being adequately compensated and consequently reduce or stop tipping altogether.

This could leave workers worse off than before, particularly if there is no clear mechanism guaranteeing that all funds collected through the service charge are passed on to employees.

The GWU points out that the service provided in restaurants, hotels and other establishments is the direct result of the work, professionalism and dedication of employees. Therefore, if a service charge system exists, its benefits should go to those who actually provide the service. This position is also shared by the Association of Catering Establishments (ACE), which has publicly stated that any service charge should be for the benefit of workers.

The Union argues that a clear and transparent regulatory framework is needed to ensure that any money collected through a service charge is administered fairly and distributed to workers, without ambiguity or differing interpretations from one establishment to another.

At the same time, questions are also being raised about the motivation behind this proposal. A few months ago, there was public discussion about the possibility of reducing the VAT rate applicable to restaurants to 7% as a measure to support the sector. Since this proposal did not materialise, several observers are questioning whether the introduction of a service charge is, in fact, an attempt to fill the gap left by that measure.

The GWU insists that any change affecting workers, consumers or the hospitality sector should only be introduced following serious consultation with all social partners, rather than through measures that could create further uncertainty.

The priority must remain ensuring decent wages, better working conditions and effective protection for workers, while maintaining a fair balance with the interests of consumers.

The General Workers’ Union will continue to closely monitor developments on this issue and reiterates its commitment to defending workers’ rights while ensuring that any decisions taken are fair, transparent and in the best interests of workers and the public.