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Goodbye service charge, hello 'admin fee'

Deep Dives

Explore related topics with these Wikipedia articles, rewritten for enjoyable reading:

  • Fee 15 min read

    The core tension in the article is between traditional service charges and new 'admin fees' designed to circumvent tipping laws. This topic explains the economics and history of service charges in hospitality, their legal treatment across jurisdictions, and why they became contentious.

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Today we’ve got a story about why the service charge on your restaurant bill might be replaced with an ‘admin charge’ — scroll down to read it.


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The “admin charge” coming to London restaurants that circumvents the new law on tipping

By Polly Smythe

If you go for a meal at L’Antica Pizzeria, an Italian restaurant with branches in Hampstead and High Barnet, you might find a 12.5% “admin charge” added to your bill. It looks a lot like a service charge and it is the same percentage cut as many service charges. But there’s one key difference — the different name means it doesn’t have to go to staff.

When one London Centric reader dined there recently, the fee took their meal from £69.20 to £77.85. When the diner asked the waiter what it was for, they were told it was to “cover the cost of the card machine and general restaurant costs.”

This is just one of the more brazen attempts to sidestep a new law requiring restaurants to pass tips to their staff in full, as restaurant owners try to remain financially viable in the face of rapidly-increasing costs. When London Centric paid a visit to L’Antica, the restaurant manager told us she wasn’t authorised to talk to us about the admin charge. Our follow-up emails went unanswered.

“No matter what senior management call it, customers will assume that this charge is a tip that should go to workers but it won’t,” said Bryan Simpson, who leads on hospitality for the Unite union. “That is completely disingenuous and almost certainly a breach of the Fair Tips Act, at least in spirit if not the letter of the law.”

Whether it’s “admin

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