A new law, designed to ensure that all hospitality staff receive the tips left to them by customers, has been announced. The Employment (Allocation of Tips) Act 2023 has received Royal Assent and is expected to be in force from 2024.
This will make it unlawful for businesses to hold back any service charges from their employees, meaning that staff will receive the full amount of tips they have earned. The new Act also provides for the development of a new statutory Code of Practice that will give businesses and staff advice on how tips should be distributed fairly and transparently.
In addition to this, workers will have a new right to request more information relating to an employer’s tipping record, enabling them to bring forward a credible claim to an employment tribunal if they believe they have been unfairly treated.
This will make it unlawful for businesses to hold back any service charges from their employees, meaning that staff will receive the full amount of tips they have earned. The new Act also provides for the development of a new statutory Code of Practice that will give businesses and staff advice on how tips should be distributed fairly and transparently.
In addition to this, workers will have a new right to request more information relating to an employer’s tipping record, enabling them to bring forward a credible claim to an employment tribunal if they believe they have been unfairly treated.
“Fantastic hospitality experiences don’t happen without a huge effort from our teams, both front and back of house, and tips are a generous way of customers showing their gratitude, while providing a welcome boost to employees’ earnings.”
Kate Nicholls
Chief Executive of UKHospitality
This overhaul of tipping practices is set to benefit more than 2 million UK workers across the hospitality, leisure and services sectors and it’s estimated by the Government that around £200 million a year will go back into the pockets of hard-working hospitality employees.