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New tips guidance published

New tips guidance published

2 May 2024

New rules that stop employers from withholding tips from people working in the hospitality, leisure and services sectors are a step closer following the publication of a new Code of Practice on tipping.

The publication of a new tipping Code of Practice brings us closer to rules that prevent employers from withholding tips from workers in the hospitality, leisure, and services sectors.

Introduction of the Act

People often refer to the Employment (Allocation of Tips) Act 2023 as the Tipping Act. It got Royal Assent on 2 May 2023. The Act’s measures will take effect once all necessary secondary legislation is in place and Parliament approves them. We expect this to happen on 1st October 2024.

Impact on Workers and Businesses

The new law will protect the tips of more than 2 million workers. According to HMRC estimates, it will return an estimated £200 million a year to the pockets of hard-working staff by retaining tips that would have been deducted.

The statutory Code of Practice will advise businesses on tip distribution among staff. The updated Code will be statutory and legally effective, making it admissible as evidence in an employment tribunal.

New rights will allow workers to view their employer’s tipping policy and their tipping record. This will support them in making a credible claim to an employment tribunal.

This significant change in the law marks a victory for workers’ rights, ensuring fair compensation for their service. The transparency it brings to the tipping process will foster trust between employers and employees. It’s a progressive step towards creating a more equitable work environment in the hospitality, leisure, and services sectors. This Act is a testament to the power of legislation in protecting workers and promoting fairness in the workplace. It’s a milestone in the journey towards better working conditions for millions of hard-working individuals in the UK.

The Business and Trade Minister said:

‘It is not right for employers to withhold tips from their hard-working employees. Whether you are cutting hair or pulling a pint, this government’s legislation which will protect the tips of workers and give consumers confidence that when they leave a tip, it goes to the hardworking members of staff.’

Source: Department for Business and Trade Tue, 30 Apr 2024 00:00:00 +0100

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