A restaurant chain is facing major criticism after it has been revealed that it told members of staff to loan the firm 10 per cent of their wages, or potentially face losing their jobs.
Furloughed staff at Tomahawk Steakhouse were asked to loan their employer 10 per cent of their wages, to cover National Insurance and pension contributions.
The company, which has branches in the North of England and recently opened another in London, told staff that the loan would be repaid “once the lockdown is eased sufficiently for the company to trade”.
Trade unions have called for this legal loophole to be closed “before other companies follow suit”.
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”.
‘If you don’t sign a new contract we will have to see if this job is right for you’
Speaking to the BBC, an unnamed member of staff revealed that employees had been told about the proposal on a video call.
They said: "I logged on to the meeting and they explained that we would have to sign a new contract. They said if you don't sign it we will have to see if this job's right for you.
"It made me very angry. Everybody is already worried about money, but then to be taking more off us for the company when the company has just opened a new restaurant in London, surely they must have money behind them rather than just relying on staff to give them a loan."
‘An outrageous abuse of the furlough scheme’
Regional Secretary for GMB union, Neil Derrick said: “This is an outrageous abuse of the furlough scheme and a legal loophole that must be closed.
“It’s never been easier for businesses to access cheap money, yet Tomahawk is bullying its own young, low-paid staff to raise interest free cash.
“This callous behaviour will leave waiters and waitresses, pot-washers and cooks short of cash and force them to take out interest rated loans to cover the shortfall or face losing their jobs.
“Tomahawk needs to take a long hard look at its behaviour – and this legal loophole must be closed before other companies follow suit.”
Tomahawk Steakhouse has been approached for comment.