[UK] Withholding hospitality staff’s tips is now illegal

The march towards a cashless society - hastened by the pandemic - has made it easier for hospitality bosses to either keep serving staff’s tips when paid by card or choose how to distribute the service charge within the company, Big Issue reports.

Pizza Express received pushback from waiting staff in May 2021 after it announced that a portion of tips would be cut to increase the pay of kitchen workers at the high street pizza chain. 

The earnings of waiting staff reportedly nosedived when their share of tips paid by credit and debit cards or the company’s app dropped from 70 to 50 per cent, according to reporting from The Guardian.

However, a long-awaited new law to make withholding tips from staff unlawful has now been passed, protecting the tips of more than two million workers from bosses. 

Kevin Hollinrake - business and trade minister - said, “Whether you are pulling pints or delivering a pizza, this new law will ensure that staff receive a fair day’s pay for a fair day’s work – and it means customers can be confident their money is going to those who deserve it.” 

The passage of the Tipping Bill was reportedly a turbulent journey. It was first introduced in September 2021, then threatened with abandonment when it was dropped from the Queen’s Speech in May 2022 under prime minister Boris Johnson. 

As it announced the new plans, The Department for Business and Trade acknowledged that “many hospitality workers rely on tips to top up their pay”, apparently acknowledging that the hourly rate isn’t sufficient to live on for those earning the national minimum wage or national living wage.

More than half of gig economy workers reportedly earn below minimum wage, according to new research led by the University of Bristol, explaining why staff depend on tips to survive. 

Big Issue summarises the Tipping Bill for both the waiting staff who will benefit from it and the customers who tip them.

The new law on staff tips

The law is expected to come into force in 2024 and will create a code of practice to “provide businesses and staff with advice on how tips should be distributed” the government wrote in a statement.

In addition, workers will reportedly have the right to request further information from their employer on where tips are going, meaning they will be able to bring a credible claim before an employment tribunal if the totals fall short. 

But Bryan Simpson at Unite Hospitality cautioned that employers could still try to flout the rules and taking a claim to an employment tribunal can be a lengthy process. 

“Like all statutory rights, from the Health and Safety at Work Act to national minimum wage, just because it’s the law, doesn’t mean that every employer adheres to it. Every week, we support workers who are denied safe conditions in the workplace or paid less than the minimum wage.”

“So the notion that they will have to pursue a hostile employer for a year to get what they’re owed is of no use to workers whatsoever.”

The new law should reassure customers that the tips they give legally belong to the staff that served them.

Virginia Crosbie - Conservative MP for Ynys Môn - said, “It was never right that a minority of companies could pocket tips when the public wanted them to go to the person who served them or made their food.” 

“The law will now boost wages for what are often lower paid jobs and not boost company profits at the expense of hard-working staff.”

Source: Big Issue

(Link and quotes via original reporting)

The march towards a cashless society - hastened by the pandemic - has made it easier for hospitality bosses to either keep serving staff’s tips when paid by card or choose how to distribute the service charge within the company, Big Issue reports.

Pizza Express received pushback from waiting staff in May 2021 after it announced that a portion of tips would be cut to increase the pay of kitchen workers at the high street pizza chain. 

The earnings of waiting staff reportedly nosedived when their share of tips paid by credit and debit cards or the company’s app dropped from 70 to 50 per cent, according to reporting from The Guardian.

However, a long-awaited new law to make withholding tips from staff unlawful has now been passed, protecting the tips of more than two million workers from bosses. 

Kevin Hollinrake - business and trade minister - said, “Whether you are pulling pints or delivering a pizza, this new law will ensure that staff receive a fair day’s pay for a fair day’s work – and it means customers can be confident their money is going to those who deserve it.” 

The passage of the Tipping Bill was reportedly a turbulent journey. It was first introduced in September 2021, then threatened with abandonment when it was dropped from the Queen’s Speech in May 2022 under prime minister Boris Johnson. 

As it announced the new plans, The Department for Business and Trade acknowledged that “many hospitality workers rely on tips to top up their pay”, apparently acknowledging that the hourly rate isn’t sufficient to live on for those earning the national minimum wage or national living wage.

More than half of gig economy workers reportedly earn below minimum wage, according to new research led by the University of Bristol, explaining why staff depend on tips to survive. 

Big Issue summarises the Tipping Bill for both the waiting staff who will benefit from it and the customers who tip them.

The new law on staff tips

The law is expected to come into force in 2024 and will create a code of practice to “provide businesses and staff with advice on how tips should be distributed” the government wrote in a statement.

In addition, workers will reportedly have the right to request further information from their employer on where tips are going, meaning they will be able to bring a credible claim before an employment tribunal if the totals fall short. 

But Bryan Simpson at Unite Hospitality cautioned that employers could still try to flout the rules and taking a claim to an employment tribunal can be a lengthy process. 

“Like all statutory rights, from the Health and Safety at Work Act to national minimum wage, just because it’s the law, doesn’t mean that every employer adheres to it. Every week, we support workers who are denied safe conditions in the workplace or paid less than the minimum wage.”

“So the notion that they will have to pursue a hostile employer for a year to get what they’re owed is of no use to workers whatsoever.”

The new law should reassure customers that the tips they give legally belong to the staff that served them.

Virginia Crosbie - Conservative MP for Ynys Môn - said, “It was never right that a minority of companies could pocket tips when the public wanted them to go to the person who served them or made their food.” 

“The law will now boost wages for what are often lower paid jobs and not boost company profits at the expense of hard-working staff.”

Source: Big Issue

(Link and quotes via original reporting)