Amsterdam, Netherlands – A leading gig economy firm, Temper Works, is facing scrutiny for advising hospitality businesses on how to sidestep new UK legislation designed to ensure fair tipping practices and to mitigate the use of precarious zero-hours contracts. The company, which started its UK operations in 2022, serves over 5,000 entities including notable clients like Hard Rock Cafe, Alexandra Palace, and Claridge’s.
Temper Works markets its services to restaurants, hotels, and bars by promoting the exclusion of freelancers from recent tipping legislation, which mandates the inclusion of agency workers in tip-sharing schemes. According to company communications, businesses that use Temper’s platform can continue to enjoy flexible labor options without the financial burden of sharing tips with gig economy workers.
As of last month, the new Employment (Allocation of Tips) Act requires that all tips received by firms must be distributed among the workers, extending to temporary agency staff. This legislative change was instigated by public backlash against practices where businesses withheld portions of tips meant for employees, a controversy highlighted by a 2015 incident involving Pizza Express deducting 8p per £1 tipped via card.
In response to the enforcement of these laws, Unite, a prominent union in the hospitality industry, criticized Temper Works. They argued that excluding gig workers from tip shares not only undermines the spirit of the law but may also be illegal. Bryan Simpson, a Unite lead organizer, accused the firm of exploiting legal loopholes to maximize profits at the expense of worker rights.
Further, Temper Works is advising companies to circumvent a potential ban on zero-hours contracts anticipated under new labor legislation supported by the Labour Party. This upcoming bill seeks to grant agency workers the right to a guaranteed-hours contract after 12 weeks of service. Temper asserts that employing freelancers as independent contractors offers businesses operational flexibility while avoiding the constraints of more rigid employment agreements.
Despite government plans for a simpler, two-tier employment framework distinguishing clear self-employment conditions, a Department for Business and Trade spokesperson emphasized that employment practices should not contravene either the intent or the explicit provisions of the law, suggesting workers may seek legal recourse including compensation claims through tribunals.
Temper Works, however, maintains its stance, declaring adherence to UK laws and transparency in its operations. The company highlights that a Dutch court confirmed its status as a work platform, not an employment agency, and emphasized protections it offers, such as a minimum wage of £12 per hour and compensation for loss of earnings which are benefits not typically extended to agency workers.
The ongoing debate around these practices underscores the challenges faced by gig economy workers and raises questions about the evolving nature of work in a digital age. As business models like that of Temper Works grow more prevalent, the conversation around labor rights and the responsibilities of gig-economy platforms becomes increasingly critical.
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