Employers in the hospitality sector - pubs, restaurants and cafes - will be banned from keeping tips left for staff under a new law from the UK government.
For a number of years, campaigners - including trade unions - have called on the government to clamp down on the common practice of withholding service charges and tips from workers.
Now labour markets minister Paul Scully says the government will legislate to end this, ensuring instead that “tips will go to those who worked for it".
What are the current rules on tipping?
At present, hospitality venues like pubs and restaurants operate a voluntary code as far as tipping is concerned. Up to now, there’s been no requirement for them to pass on any tips in full to workers.
A number of high street chains are said to have withheld or all or part of staff tips, prompting pressure from campaigners to get the law changed so that tips and service charges go directly to workers.
Given that tips are now mostly paid for by card rather than in cash, it’s become even easier for employers to keep all or part of tips, service charges and processing fees for themselves.
Many hospitality staff rely on tips to top up what is usually a pretty modest income, so the withholding of tips can make it harder for them to make ends meet.
What are the new tip laws?
Under the new tipping legislation, withholding tips from employees - in full or in part - will be a criminal offence, and businesses that continue to do so will be breaking the law.
Offending employers could be fined or ordered to compensate workers who have had their tips withheld from them.
“Unfortunately, some companies choose to withhold cash from hardworking staff who have been tipped by customers as a reward for good service,” Paul Scully commented.
When will the new tip laws come into force?
The new law on tipping is not expected to come into effect until late 2022 at the earliest. It will form part of the UK government’s next Employment Bill.
This is despite the fact that former prime minister Theresa May pledged to legislate against the practice of withholding tips as long ago as 2018.
It was also mentioned in the 2019 Queen’s Speech, the first of Boris Johnson’s tenure as prime minister.
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