ZDF exposes Sandeman's New Europe tours business - Germany

Law professor claims company practices are illegal

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The investigative journalists at ZDF's Frontal21 ran a story on Sandemans New Europe last night, confirming that guides have to pay the organizers €3.00 for each guest who shows up for their tours and then beg for tips in the hope of breaking even.

Eine Mitarbeiterin der Firma notiert gleich zu Beginn der Tour die Zahl der Gäste, schreibt sie auf, und gibt das dem Stadtführer weiter. Drei Euro pro Kopf müssen Stadtführer wie Michael Dempsey zahlen - auch wenn das Trinkgeld spärlich fließt.
A company employee notes the number of guests at the start of the tour, writes it down and gives it to the guide. Guides like Michael Dempsey [who formerly worked for Sandeman] have to pay three euros per head - even if the tips are meager.

Michael Dempsey bekommt einmal pro Woche die Zahlungsaufforderung der Firma per SMS aufs Handy. 303 Euro muss er diesmal aufs Sandeman-Konto einzahlen - selbst dann, wenn er soviel Trinkgeld gar nicht bekommen hätte. Dann müsste er also sogar draufzahlen.
Michael Dempsey is sent demands for payment once a week via SMS. This time he has to transfer 303 euros to Sandeman's account - even if he didn't get that much in tips. In that case, he'd have to make up the difference himself.

A law professor at Münster University calls the company's practices a "crassly illegal abuse of labor law".

"Wir haben einen Arbeitnehmer, dem wird kein Geld bezahlt, zusätzlich wird ihm das Trinkgeld, das ihm die Kunden geben, teilweise weggenommen. In Wirklichkeit müsste der Arbeitgeber ihm einen Stundenlohn zahlen und das Trinkgeld, dass er bekommt, darf er behalten."
"We have an employee who is not paid any money; moreover, he is even relieved of some of the tips the customers give him. In reality the employer has to pay him an hourly wage and he must keep all the tips he receives."

Mr. Sandeman declined to be interviewed for the story, claiming he spoke no German. When the reporter repeated his question in English, Mr. Sandeman said he had no time.

Here's the link to the full text (in German) at ZDF.de. Unfortunately, the video clip isn't online.

UPDATE - 18.Mar.2010 by Editor Bob:

SANDEMANs NEW Europe have issued a press release in response to the above Frontal21 reportage.
Small Town Boy
You can watch the programme again on the ZDF Mediathek for the next seven days. Direct link to programme. The bit on Sandemann starts at 21:00.
Thanks, STB - I checked the Mediathek last night, but it wasn't up yet.
Just checked - the video seems to be up and running now.
I just watched it and all i can say is.. this is big time when it hits german media.. the govt and especially our wonderful friends at the Steueramt and the Financeamt like to take notice.. this could be a death knell for his firm..

Thank god its about time the germans relized his whole thing is a scam!!.. maybe just maybe now the Financeamt, or similar, hell at least the city might blacklist him for dodgy business practices.. as a former worker of his outfit.. all i can say is bout damn time..
That's a disgustingly exploitative practice. Hopefully no potential employee will fall for this again.
i think someone called him out.. a whistleblower as we call it in America.. someone didnt get paid like always and called their connections in media.. ill bet my next paycheck on it!
Small Town Boy
He was exposed on Toytown over a year ago already, but it seems the thread has been deleted.
That thread was removed (not by me) for name-calling and personal insults.
oh lordie
The tours are free to go on, but the expectation is set at the start that the guide will get a good tip.

The guide will make comparisons with tours where you pay 10-12 Euros to go on, stating that this tour is equally good, that this system allows the customer to decide how much to give, and that the guide will have a good incentive to provide a fun, informative tour.

I paid well over 3 Euros, but short of the 10 Euros the charging tours cost, for my most recent tour.
I read the original posts and was shocked.

After viewing the film, I still think what they're doing is above board, though. I'm ready to be called an ignoramous, but in a country like Germany I just don't see how you could operate in the public gaze without having to answer certain questions at the appropriate Amts.

As for this film putting off people from joining the tours in future, I'd be wary of saying that. How many people visiting Berlin from outside of Germany would have seen this? Not many, I expect.

Well done on the guide for speaking to the cameras though, by the way. What a crazy system. But... one imagines they knew the score before they signed up... ? Hope that doesn't come across as too harsh.
But hang on, these guys are not the only ones working on this principle? I considered doing a bit of tourguiding when I first came to Munich with a rival company (won't name names). And their principle was pretty much the same? You took a head count before the 'free tour' started, and then you had to basically get the message across that they had to tip you afterwards according to how much they enjoyed the tour. You also had to pay the company 2-3 euros per head from all of the tips you made, although I'm not sure if they would have demanded you make up the difference if the tips were especially bad. All guides had to work as 'Freiberüfler' and pay their own tax and healthcare. The deal was supposedly sweetened by the fact that you had the chance to sell the company's other tours (not free) during your free tour (for these tours you would get paid a set fee per head)

After doing the math I rejected the idea as I could see myself, after health insurance payments, travel costs and bad weather days, ending up in the minus column.

So what exactly is Sandeman doing differently then? Shouldn't these other companies be looked at a bit more closely as well?
Small Town Boy
Sandeman's not doing anything differently, but he was the first. You can't beat free, and so other companies have been forced into adopting the same system or similar. Ultimately, the losers are the customers, as the quality of the guides decreases in line with the wage.
I agree that it's exploitative but nobody came out of that film looking very good. Sandemann of course. That British immigrant who feels entitled to live in Germany and earn a living here but clearly hasn't been bothered to make the effort to learn German. The tour attendeees who get great value from someone's work but who only fork out about 5 Euro per head on average (so some must be so tight as to give nothing).

Do Finanzamt care that much? In general (not referring to this particular instance), there's a vast swathe of "non-compliant" business here that is overlooked, including that which takes advantage of / exploits immigrants who can't even speak the language of the country they choose. But what's the alternative? More immigrants who are unable to fend for themselves on Hartz IV living off Germans' tax?

The Brit immigrant earned 18 Eur net. So that's what, 6 Eur an hour, which I understand is fairly normal for Berlin? He's freelance, that's his choice (and he's hardly the only freelancer to give a cut to the people that find the work). He can do other stuff the rest of the time, he's not an employee. And as saffagirl says, presumably he did the maths?
Swimmer, you've made the assumption that the guide hadn't bothered to learn German. Just because he spoke in English in the film, doesn't mean for a second that he's not even tried. It could be that he's not quite fluent. Give him a break!

As for feeling he is entitled to live in Germany... well, he is... so he can feel that all he likes, I guess.

The only problem I see with it is that if you agree to these terms before you work for the company, is it really okay to complain?
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