A new law backed by Conservative MP Virginia Crosbie could make keeping tips from workers illegal.
A government official said: ‘The Employment (Allocation of Tips) Bill, backed by the government, will ensure that all tips go to staff by making it unlawful to hold back service charges from employees.
‘More than two million UK workers will benefit, helping ease pressures caused by increases in the cost of living.’
Under the current arrangements, tips paid in cash are the legal property of staff, but businesses that receive additional payments by card do not have to pass them on. According to government data, 80 percent of all tipping now occurs by card, which makes it easier for business chiefs to withhold the cash.
The move will affect 190,000 businesses across the leisure, services and hospitality sectors, where tipping subsides workers – many of whom earn the National Minimum Wage or the National Living Wage.
The government first publicised its plans to force businesses to allocate tips to workers 4 years ago, but the legislation was never enacted. In September last year, the then Labour Markets Minister, Paul Scully, said: ‘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.’
The Workers Union Says…
We welcome any steps to put money in the pockets of working people at this difficult time. Business owners must not be allowed to siphon funds away from the very people that provide the services on which many of us rely.
Of course some will argue that workers should be grateful for their jobs and anything else they receive is a bonus, not a right. To take that line is to forget about the reputational effects of happy and motivated staff. If people feel like they’re getting a good deal, they work harder, the team gets tighter and the company projects a united front to the world.
With difficult operating conditions forecast for the next 12 months at least, business owners are going to need the energy, verve and industry of British workers to make it through to the other side unscathed. Taken in this context, fair distribution of tips seems a small concession to make to ensure continued goodwill.
