Salary structure by brigade rank
Set a monthly gross for each rank, from kitchen helper and commis up to chef de partie and sous chef, and for each floor role from steward to captain. Direct Payroll then divides that gross between Basic, DA, HRA and Special using the percentages you set for the company. Keep Basic plus DA at no less than half of the total, because the Code on Wages counts any excess allowances back into wages, which lifts the PF, gratuity and bonus base; an inflated Special allowance does not reduce contributions. Revisions go into the salary history, so a cook promoted from commis to chef de partie shows the change and its date.
Sharing the service charge pool
Where an outlet collects a service charge, staff care most about how it is shared. Write the rule down and use points. Say the month's pool at a Bengaluru outlet is ₹72,000 and 23 staff share it: 2 captains at 1.5 points each and 21 others, across the floor, kitchen and stewarding, at 1 point each. That is 24 points, worth ₹3,000 each. Each captain gets ₹4,500 and everyone else ₹3,000. Staff who worked only part of the month can be pro rated by days present, as long as the rule says so in advance.
Calculate the shares in a sheet, have the restaurant manager sign it, and enter each amount as an incentive input so it shows on the payslip as its own earning line. Fixed salary is the wrong home for it, because the pool rises and falls. Check the current rules on service charge collection, and take advice on how the shares count for PF and ESI.
Advances, meals and accommodation
Staff advances are part of restaurant life: a cook going home for a wedding asks for ₹10,000 against salary. Agree the recovery plan when the advance is given, for example ₹2,500 a month for four months, and enter it as an advance recovery input each month. Staff meals are usually free and need no deduction. If staff live in outlet accommodation and you recover a charge, agree it in writing and check what the law allows under deductions from wages before entering it as an adjustment. Fines for breakage are a sensitive area: keep them rare, documented and within the permitted deductions.
Statutory items and paying on time
On statutory items, each payslip carries the employee's PF, ESI and state professional tax, while the employer's contributions, EPS and EPF on the PF side plus employer ESI, are worked out alongside. Many kitchen and floor salaries sit within ESI coverage, so check ESI applicability whenever salaries change. The days paid are read from the attendance month once it is finalized, never counting days before joining or after exit. Wages for the month are due by the 7th of the next month, and a leaver's wages within two working days, which matters in a trade where people often leave without notice.
How to set it up in ZeniaHR
- Turn on Direct Payroll, record each rank's monthly gross, and choose company percentages that keep Basic plus DA at half of gross or more.
- Pick the loss of pay basis and half-day pay fraction in the deduction policy, adding branch overrides for outlets in other states.
- Every month, key in service charge shares as incentive inputs and advance instalments as advance recovery.
- Run the regular payroll after attendance month close: draft, review against the outlet manager's sign-off, then finalize.
- Approve the payment batch before the 7th, and settle leavers through an off-cycle run within two working days.
- Point staff to payslip PDFs in the mobile app, so each person can check their service charge line.
Read more about payroll in ZeniaHR.
Roles this applies to
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How do restaurants distribute service charge to staff?
A common method is a written points system: each role carries a number of points, the month's pool is divided by the total points, and each person receives their points multiplied by the point value. Pay the share through payroll as a separate earning, not inside fixed salary, and publish the rule so every steward, cook and dishwasher can check their share.
Can a restaurant recover salary advances through payroll?
Recovering an advance through payroll is common when the instalments are agreed at the time the advance is given. Record the amount and monthly instalment, recover it as an advance recovery each month, and check the permitted deductions from wages under the Code on Wages. If the employee leaves, settle any balance in the full and final.
Should service charge be part of a restaurant employee's fixed salary?
No. The pool rises and falls with guest bills and depends on the rules for service charge, so keep it outside the salary structure and pay it monthly as a separate earning. Fixed salary should be set by rank and meet the wage rule on its own, so staff are paid properly even in a slow month.