NCASS (The Nationwide Caterers Association) is working with cashless payment providers and festival organisers towards a Code of Practice for the festival industry following a festival liquidation, which left traders out of pocket.
The organisation has been vocal in supporting caterers who were left out of pocket following a festival this summer, where a cashless payment system was used, leading vendors to report that they received no payment for their work.
NCASS has since criticised situations in which revenue from a cashless payment system is held by a third party. As reported in the November issue of Access, NCASS has advised all its members that cashless payment systems should be avoided until a system for ring fencing money is developed.
The proposed Code of Conduct is intended to protect the livelihoods of businesses at future events and to promote greater understanding between the different sectors of the industry, a statement read.
“Earlier this year, a festival left traders out of pocket for four days work after a cashless payment system exploited a loophole in cashflow management; the cashless payment system provider was not at fault, and enabled festival goers to make purchases throughout the weekend, transferring the money from sales direct to the festival organisers to pay traders. Responsibility for the non-payment fell to festival organisers who in turn, failed to hold the funds in trust for the traders, instead informing traders that they would not be paid the money they had earned,” it continued.
The association also offered the festival’s catering businesses access to its legal and financial advice help-line.
NCASS has been working with the Association of Independent Festivals (AIF) and Glownet, a member of the Cashless Payment Industry, to look into what went wrong and how best to prevent a re-occurrence of this problem.
Work has now begun towards developing a code that is both practical and reasonable to protect traders, the public and event organisers.
A round table discussion took place at the first Festival Congress in Cardiff and further discussions will be taking place between the AIF and their member companies as well as RFID system providers.
The organisers of the festival in question are not a member of the AIF.
“Our ultimate aim is to find ways of putting a safety net in place to protect all parties, including independent caterers who are using cashless payment systems,” said NCASS director Mark Laurie. “The points of discussion at the moment are whether any earnings will be held in trust rather in the organisers normal business account and what would be an appropriate timeframe in which to pay the traders.
“RFID systems have been used successfully at events such as Standon Calling, but the organisers paid the traders at the end of each day’s trading. A code of practice will hopefully protect all involved while not being an administrative or financial burden on the organisers or traders,” he added.
“We are committed to delivering a robust and easy to use system that not only creates a better customer experience but helps ensure fairness and transparency between the promoter and the trader,” said Glownet’s Scott Witter. “We support this initiative towards protecting the interests and livelihoods of those independent caterers that the wider industry depend on.”
Meanwhile, Paul Reed, general manager of the AIF, told Access that his association was “dismayed to hear about the events at earlier this year – it’s difficult to quantify the damage such incidents can do to our sector’s reputation, not to mention the very real financial damage this has done to catering traders.
“Festivals such as Standon Calling prove that cashless systems can work well and we are keen to work with NCASS and RFID providers to explore solutions that will prevent this from happening again, to ensure that safeguards are in place, creating a more secure environment for festivals and caterers alike”.
All parties are working to get a code of practice in place before the end of the year.