Hospitality industry staff will pocket ALL their tips under new laws designed to safeguard the rights of two million workers

  • All tips to go to hospitality staff under Government’s new legislative proposals
  • Employees could go to tribunal or request data from watchdog over work tips 
  • Department for Business said measures needed to help hard-hit service staff 

Hospitality staff could soon keep the entirety of tips given to them by customers under new plans to safeguard workers’ rights and remodel an industry-wide practice. 

Employers would face sanctions for breaking the law if they pocket employees’ tips under a new framework due to set out by the Department for Business, Energy and Industrial Strategy today. 

A spokesman for the Department told the Times the new legislative guidelines were needed to ensure customers know their little extras end up in service staff’s pockets. 

The new rules could benefit approximately two million hospitality staff members in a welcome boost to low paid workers who often rely on tips to help boost minimum wage salaries. 

Employers could face sanctions for breaking the law if they pocket their employees’ tips under a new framework due to set out by the Department for Business, Energy and Industrial Strategy today

Research showed businesses that operate with an optional service charge for parties or gatherings often keep part of all of said charges instead of divvying them up among staff. 

Front of house staff would be protected with the potential for employment tribunal and data requests over how their bosses were sharing tips, should the Department’s proposed legislative changes come to pass.

A new, potential statutory code of practice comes amid a wave of mooted measures designed to protect and preserve worker’s rights in the UK.

Similar steps have seen the implementation of a nationwide bereavement leave for grieving parents and minimum wage boosts – now set at £8.91-an-hour for those aged 21 and over, and £6.56 for those aged 16 to 20. 

It comes as union chiefs wrote to Business Secretary Kwasi Kwarteng warning that the fall in cash payments and employers ‘interfering’ with tips has created a ‘perfect storm’ that has wiped out recent rises in the Living Wage and Minimum Wage. 

Restaurant owners are banned from keeping cash tips left for waiting staff, but there is nothing to stop them taking a cut when the bill is settled by debit or credit card, which has become increasingly popular as cash use was discouraged in the pandemic. 

Campaigners say about 1.6 million hospitality workers are being left out of pocket as up to two-thirds of employers in the sector take a share of customer gratuities

Paul Scully, the Government’s labour markets minister, told the Times: ‘Unfortunately, some companies choose to withhold cash from hardworking staff who have been tipped by customers as a reward for good service.

‘Our plans will make this illegal and ensure tips will go to those who worked for it.

‘This will provide a boost to workers in pubs, cafes and restaurants across the country, while reassuring customers their money is going to those who deserve it.’

Earlier this year, campaigners warned approximately 1.6 million hospitality workers were losing out on hard-earned extra cash when restaurant and bar bosses pocketed their tips.

Exacerbating the issue is society’s trend towards increasingly popular electronic payments, meaning businesses can then decide whether or not to keep tips paid on debit or credit cards.

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