In a brazen move that has sparked outrage, Netherlands-based gig economy firm Temper Works is advising its hospitality clients in the UK that they can bypass recently enacted fair tipping laws and an impending ban on zero-hours contracts by leveraging the company’s pool of freelance workers. The controversial guidance has drawn sharp criticism from labor unions and workers’ rights advocates, who argue that Temper is promoting potentially unlawful practices to undermine hard-won protections for vulnerable employees in the sector.
Temper Claims Freelancers Fall Outside New Legislation
In a briefing published last month, Temper Works asserted that the freelancers supplied through its platform to over 5,000 client companies, including high-profile names like Hard Rock Cafe, Alexandra Palace, and Claridge’s, are exempt from the provisions of the new tipping legislation. The firm contends that by engaging these workers, businesses can maintain access to flexible labor without incurring the “added costs and complexities” of including temporary agency staff in tip allocation schemes mandated by the Employment (Allocation of Tips) Act, which took effect in October 2024.
Union Slams “Morally Reprehensible” Advice
Unite, the union that spearheaded the campaign for the new tipping rules, has slammed Temper’s guidance as not only “morally reprehensible” but also “almost certainly illegal.” Bryan Simpson, Unite’s lead organizer in the hospitality sector, argued that courts would likely find the gig workers to be falsely classified as self-employed, making their exclusion from tip-sharing pools potentially unlawful.
For Temper Works to be so flagrantly advertising services which seek to flout new and well-established employment law to line their own pockets isn’t just morally reprehensible, it is almost certainly illegal.
Bryan Simpson, Unite lead organizer in the hospitality sector
Skirting Proposed Zero-Hours Contract Ban
Beyond the tipping controversy, Temper is also counseling clients on how to use its freelance workforce to circumvent a proposed ban on zero-hours contracts, a key component of Labour’s forthcoming employment rights bill. Under the planned legislation, agency workers on such contracts would gain the right to guaranteed hours after 12 weeks. Temper argues that businesses should pivot to using independent contractors to sidestep these “obligations and restrictions” and keep labor costs down.
“Surviving” Minimum Wage Hikes
In a related brief, Temper suggested its platform could help companies “survive” the recent increase in the national minimum wage to £12.21 per hour by enabling them to book freelancers for shifts as short as 60-90 minutes to cover peak demand periods. The firm boasted that clients “only need to pay for staffing precisely when required, and only for the actual time worked on shift.”
Government Vows Crackdown on Circumvention Attempts
The Department for Business and Trade has warned that employers should not attempt to skirt the “letter or spirit” of employment laws through tactics like false self-employment or withholding tips. A spokesperson emphasized that workers can seek recourse through tribunals, where offending firms may face significant compensation orders. The government also plans to consult on simplifying the employment status framework to better distinguish genuine self-employment from other work arrangements.
Temper Defends Practices, Cites Worker Benefits
In response to the backlash, Temper Works maintained that it operates lawfully and transparently, pointing to a Dutch court ruling that classified it as a platform for work rather than an employment agency. The company argued that features like the ability to appoint substitutes, negotiate pay rates, and decline shifts ensure its freelancers are genuinely self-employed. While acknowledging that these workers fall outside the tipping legislation, Temper noted that clients can still choose to allocate gratuities to them.
The firm further asserted that its model offers freelancers advantages over agency work, such as higher hourly rates (averaging £14.09 in September), compensation for lost earnings, and control over scheduling. It dismissed the impending zero-hours ban as ineffective, arguing that legitimizing independent contracting would do more to empower workers.
Controversy Highlights Gig Economy Tensions
The dispute over Temper’s practices underscores the ongoing tensions and regulatory challenges surrounding the gig economy’s role in the labor market. As policymakers strive to balance worker protections with business flexibility, debates rage on about the classification and treatment of app-based freelancers. The outcome of this latest controversy could have significant implications for the future of work in the UK’s hospitality sector and beyond.
