High street slot machine shops are paying their staff bonuses linked to how much gamblers lose, the Guardian has learned, prompting condemnation of the “appalling” reward scheme from MPs and campaigners.
A network of 1,451 “adult gaming centres” (AGCs), most of which are open 24 hours a day, has spread through the UK in recent years, concentrated in the most economically deprived areas.
Amid booming revenues, the German-owned Merkur posted a £15m profit for 2024, while Admiral Slots paid its Austrian owner a £10m dividend last year, according to accounts posted at Companies House this week.
It can now be revealed that the growth of at least one of the sector’s leading players has been partly fuelled by incentive schemes that unlock bonuses in return for hitting key targets. At Merkur, these targets include revenues from punters’ losses on highly addictive slot machines.
For venue managers at Merkur, most of the bonus – worth up to 80% of annual salary – is linked to “controllable profit”, according to one internal document setting out the scheme’s structure.
This measure is partly determined by outgoings on wages and smaller items designed to keep customers playing, such as complimentary food, drinks and “cash giveaways”.
But the first item on the list of factors contributing to controllable profit is “net revenues”.
In effect, this means takings from the shops’ slot machines, which offer stakes of £2 every 1.5 seconds, for a maximum jackpot of £500.
The machines have been linked in successive studies to higher rates of addiction than most other gambling formats.
Jackie Olden, whose late mother lost thousands of pounds at a branch of Merkur in Stockport. Photograph: Joel Goodman/The Guardian
Jackie Olden had campaigned for tougher regulations on AGCs, after her late mother, who was terminally ill, lost thousands of pounds at a branch of Merkur in Stockport. The company was fined nearly £100,000 earlier this year for social responsibility failings, after reporting by the Guardian.
“It feels like a punch in the face that my mum might have been helped, but the staff may have been financially motivated not to stop her,” Jackie said.
“It feels like the fine they received has taught them nothing.”
Merkur said it “strongly rejects” any suggestion that its incentive scheme undermines safer gambling objectives.
Lawyers for the company pointed out that a portion of the controllable profit bonus, equivalent to 20% of salary, can be lost if shops fail to hit performance targets, which include completing safer gambling training.
The bonus also includes a separate element – worth up to 20% of salary – based on reaching “compliance and audit” targets. These are understood to include a “safer gambling” element involving bosses asking junior staff about their interactions with customers.
Lawyers for the company said extra safer gambling elements had been added to the bonus scheme in January 2025 and had resulted in more interactions with customers.
But MPs from across the political spectrum raised concerns about the potential moral hazard created by any incentive scheme linked to revenues from slot machines.
They said this could give AGC staff, some of whom earn minimum wage, a reason to look the other way when vulnerable people are racking up huge losses.
Iain Duncan Smith, the former Conservative leader who now campaigns for gambling reform, said that even though an element of the bonus was linked to safer gambling targets, the overall scheme looked like “an incentive not to intervene” when punters are losing sums they cannot afford.
He said it appeared that firms were “paying cynical lip service to their ‘obligation’ to stop harmful gambling. Appalling.”
The Labour MP Dawn Butler, who is bidding to become London’s next mayor, said: “The payment of these bonuses seems to completely contradict statements from these companies about their commitments to social responsibility.
“This bonus structure should immediately be changed. It also begs a question as to why the Gambling Commission allows these practices by AGCs in the first place.”
Her fellow Labour MP, Alex Ballinger, said the scheme “shows a complete lack of responsibility and the urgent need for greater regulation”.
In 2020, the Gambling Commission told operators to stop paying bonuses to staff working on controversial “VIP schemes” for high-value customers, meaning those who lose a lot of money. But it said these rules do not apply to how staff are paid in AGCs, despite the fact that punters can easily lose hundreds of pounds an hour.
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Merkur said it ‘strongly rejects’ any suggestion that its incentive scheme undermines safer gambling objectives. Photograph: William Barton/Alamy
One former Merkur staff member told the Guardian that the opportunity to make extra income meant staff were less likely to perform “safer gambling interactions”.
These interventions, a condition of having a licence to operate in Great Britain, include recommending customers take a break when they have suffered heavy losses or appear distressed.
“Staff are not inclined to break the game with a customer that is losing a lot of money because they think that will add to the income,” they said.
“I have seen it on many occasions when staff members decide to leave the customer alone when he is losing.
“At the end of the day, the company is trying to make profit and for that the customer needs to lose.”
One former staff member at Merkur said the maximum bonus of 100% of salary was impossible to achieve in practice.
They added that junior staff get smaller sums, up to £315 every month.
The bonus scheme used to be more generous but was changed in January this year, they said.
The Guardian understands that other big companies in the sector operate similar bonus schemes.
Annual accounts for Admiral’s two leading UK trading companies show combined revenues up 12% to more than £300m last year, while combined pre-tax profit climbed 16% to £46.3m.
The accounts also state that “remuneration packages include performance incentives and other benefits”.
The company did not respond to a request for more information about its bonus scheme.
A spokesperson for Merkur said: “We strongly reject any suggestion that our incentive schemes conflict with our obligations to protect customers or that they in any way discourage staff from carrying out safer gambling interactions.
“All our bonus structures are designed to recognise a range of operational and compliance metrics, including strict safer gambling, audit and training requirements.
“Merkur is committed to ensuring a safe, responsible and enjoyable environment for all customers and to maintaining the highest standards of integrity and compliance across all our venues.”
Bacta, the trade body for AGCs, said: “Bacta does not issue specific guidance on staff bonus schemes, but all members operate in a highly regulated environment and are required under our social responsibility charter to ensure that all commercial practices support compliance with safer gambling and social responsibility obligations.”