A steakhouse chain which was accused of bullying staff into providing the firm with loans of 10 per cent of their furloughed wages has denied that employees would have been sacked if they didn’t agree.
Tomahawk Steakhouse, which has several branches in the North of England and recently opened another in London, also revealed that “every single” employee chose to sign up to the loan agreement, totalling approximately 500 staff.
This comes after the Treasury confirmed that “employers cannot enter into any transaction with the worker which reduces the wages below” the furlough amount.
‘Every single employee chose to sign up’
Tomahawk Steakhouse released a statement, denying claims that staff were pressured into signing the loan agreements, and accusations that it was suggested, during a video call with employees, that their roles would be up for review if they didn’t agree to the loans.
The statement read: “At no point has Tomahawk Steakhouse suggested that members of staff would be sacked if they did not sign a loan agreement.
“Like the rest of the hospitality industry, we have faced a challenging year, and our priority throughout has been to protect our people and our business.
“As part of this and in order to survive the coming months, we asked our staff to sign up to a voluntary agreement to help us cover the cost of Employer NIC/Pension amounts, in the form of a loan.
“Every single employee chose to sign up to this agreement.”
Government weighs in
In response to a written question tabled by the Labour MP for York Central, Rachael Maskell, Treasury minister Jesse Norman said that employers “cannot enter into any transaction” which reduces the amount of furlough paid, and that “employers are required to pay staff all the Coronavirus Job Retention Scheme grant they receive”.
Mr Norman said: “Employers are required to pay staff all the Coronavirus Job Retention Scheme (CJRS) grant they receive from HMRC to cover 80% of wages up to £2,500 per month. The employer is still required to meet the employer’s National Insurance and pension contributions.
“Employers cannot enter into any transaction with the worker which reduces the wages below the amount claimed. This includes any administration charge, fees or other costs in connection with the employment.
“Where an employee had authorised their employer to make deductions from their salary, these deductions can continue while the employee is furloughed provided that these deductions are not administration charges, fees or other costs in connection with the employment.”
Accused of bullying
A letter sent out to staff by Tomahawk Steakhouse reportedly said: “The company has a short-term cash flow issue and it now requires your help and support”.
It continued: “We respectfully ask, in these difficult times, for you to support us by agreeing to pay your own Employer’s NIC/Pension Contributions by way of a voluntary ‘loan’ to the company, whilst we are in lockdown”.
An unnamed staff member told BBC News that, on a video call with employees, "they said if you don't sign it we will have to see if this job's right for you".
The GMB union criticised Tomahawk Steakhouse yesterday (1 March) for “bullying its own young, low-paid staff to raise interest free cash” and called on the Government to close the “legal loophole”.