On Monday 14 October, it was announced within the Queen’s Speech that the government will introduce the Employment (Allocation of Tips) Bill to ensure the full amount of tips, gratuities and service charges paid by customers are passed to workers. This will result in a code of practice being introduced, setting out the principles of a fair and transparent allocation.
The announcement follows a 2016 public consultation, which arose as it was revealed that many high street restaurant chains were withholding up to 10% from tips paid by credit and debit card. This is something we previously covered back in October 2018, where we shared our thoughts regarding the proposed legislation.
Since the latest announcement in 2019, a general election has been called, which is likely to delay the bill once again. While we await the publication of further details from the new or re-elected government, owners of hospitality and leisure businesses can act now. At Buzzacott, we already champion the allocation of tips, gratuities and service charges to workers through tailored tronc systems that are fair, ethical and protect our clients from any challenges from HMRC. We are happy to work with any potential client so they meet all the necessary tronc requirements and will guide you through any challenges that may arise with the proposed new legislation.