HARRODS will become the first British retailer to be taken to court in a dispute over what is defined under the Employment (Allocation of Tips) Act 2023 tomorrow.

Workers employed across Harrods’ restaurants allege that a £1 “cover charge” per person legally qualifies as a tip and the iconic retailer has breached the law by failing to fairly distribute it with them.

Their case is scheduled for its first employment tribunal hearing today which their union, UVW, said could set legal precedent across the hospitality sector.

UVW argues the levy is a tip as no additional food or other service is offered to customers and managers have had discretion to remove the cover charge on request. 

The cover charge introduction in November 2023 has led to many customers removing the separate discretionary 12.5 per cent service charge, added UVW.

Harrods was contacted for comment.