A YORK steakhouse restaurant whose owner controversially asked staff to loan the business from their wages has now agreed to repay the money.

Tomahawk Steakhouse came under fire from York Central MP Rachael Maskell and the GMB Union after asking staff to sign up to a voluntary loan agreement to help cover the cost of Employer NIC/Pension amounts.

The speciality steak chain with restaurants in York, Beverley and Husthwaite, defended its actions at the time, saying the priority was to protect its team and business after a challenging year.

In a statement today, a Tomahawk spokesman said: "As part of the voluntary agreement signed by all of our staff, we promised that any monies loaned would be returned as soon as we were financially able.

"Following the Budget announcement last week, we are delighted to have been able to swiftly honour that promise this week.

"All staff have now received the loaned amount, along with an additional 20 per cent, as a thank you for supporting the business at this critical time."

The GMB Union condemned the loan request as an 'abuse of the furlough scheme' and said it should not be repeated elsewhere.

It said today's confirmation that Tomahawk restaurants had begun repaying 'the low-paid, furloughed workers' was a 'massive win for workers’.

Neil Derrick, GMB regional secretary, said: “This was always an outrageous exploitation of both the furlough scheme and low paid, young workers.

“The cash should never have been taken in the first place as no employee can afford a further reduction in their take home pay - especially when it’s to cover their employer’s own obligations."

He added: "Their U-turn is a massive win for workers. Let’s hope this abuse of the furlough scheme is over and not repeated elsewhere.”

Ms Maskell welcomed the news.

"This was so good to hear. In response to my Parliamentary Question, the Treasury Minister confirmed that Tomahawk could not use the furlough pay of their low paid staff to prop up their business.

"Their conduct has been disgraceful, and I thank the GMB union for achieving the right remedy for their members.

“It is a very difficult time for businesses with the many holes in the provision, however it is tough on workers too. We have to support each other through this time. I am always here to support workers and business through this season.”

In response to her Written Parliamentary Questions to the Treasury, questioning whether Tomahawk's actions were lawful or the intent of Government, the Treasury Minister, Jesse Norman MP, the Government’s finance secretary, responded: "Employers are required to pay staff all the Coronavirus Job Retention Scheme (CJRS) grant they receive from HMRC to cover 80 per cent of wages up to £2,500 per month.

"The employer is still required to meet the employer’s National Insurance and pension contributions.

"Employers cannot enter into any transaction with the worker which reduces the wages below the amount claimed.

"This includes any administration charge, fees or other costs in connection with the employment."