Annabel’s (Berkeley Square) Ltd and Others v Revenue and Customs: CA 7 May 2009

The court considered whether tips paid at a restaurant by means of a credit card or cheque thus becoming the employer’s money could properly count toward the minimum wage when paid on to the employee. The revenue contended that the money received and held by the troncmaster independently and not on behalf of the employer and therefore could not count toward the minimum wage calculation.
Held: The employer’s appeal failed. The sum paid by the troncmaster was not the employer’s money because, at the point of payment, what was paid to the employee was money forming part of a fund constituting in equity the employees’ commonly owned property. The employer could not claim that it paid the relevant money to the employee because it was not its money that was so paid. The employer may regard this as hard because the money so paid did admittedly derive from money that was once its own. The result, however, flows from a legitimate and genuine arrangement under which the administration and distribution of service charge money was to be handled exclusively and independently by the troncmaster; and which was established with an eye focused on the saving of NICs for employer and employee.

Rimer LJ, Mummery LJ and Sullivan LJ
[2009] EWCA Civ 361, Times 13-May-2009
National Minimum Wage Act 1998, National Minimum Wage Regulations 1999 (SI 1999/584) 30(a)
England and Wales
CitedWrottesley v Regent Street Florida Restaurant QBD 1951
Waiters at an unlicensed restaurant (with their employer’s agreement) put all tips into a box whose key was held by the head waiter. At the end of each week the contents were distributed between the waiters in accordance with their agreed . .
CitedNerva and Others v R L and G (T/a Paradiso E Inferno and Trota Blu Wine Bar) CACD 15-May-1996
A waiter’s tips which were received, and then re-distributed by the employer, are part of the employees’ wages for minimum wage purposes. The gratuities became the employer’s property so that when they paid the waiters their share of them, they were . .
Appeal fromRevenue and Customs v Annabels (Berkeley Square) Ltd and others EAT 13-Jun-2008
EAT National Minimum Wage
Where restaurant or bar service charges are paid by the customer to the employer, but are then paid into a troncmaster’s bank account for distribution by him/her in accordance with . .
CitedBarclays Bank Ltd v Quistclose Investments Ltd; etc HL 31-Oct-1968
R Ltd were in serious financial difficulties. The company’s overdraft with the appellant bank was almost twice its permitted limit. The company sought a loan of 1 million pounds from a financier, who was willing to lend the company that sum provided . .
CitedBarclays Mercantile Business Finance Ltd v Mawson (HM Inspector of Taxes) HL 25-Nov-2004
The company had paid substantial sums out in establishing a gas pipeline, and claimed those sums against its tax as capital allowances. The transaction involved a sale and leaseback arrangement which the special commissioners had found to be a . .

Lists of cited by and citing cases may be incomplete.


Updated: 10 November 2021; Ref: scu.341828