UK government opens tipping consultation

Following a call for evidence into tipping practice in the hospitality sector, the UK government has announced a consultation on new plans to “secure a fairer deal for workers”.

UK business secretary Sajid Javid has called for a review into tipping practices

Announced by business secretary Sajid Javid, the plans aim to end “unfair” tipping practices and increase transparency.

Currently there is no legal requirement in the UK that tips should go to workers, although a voluntary code of practice was introduced in 2009 to improve information available to consumers.

The government’s proposals include updating the current voluntary code of practice and putting it on a statutory footing to increase employer compliance; increasing transparency for consumers and make it clear that suggested discretionary payments for service are discretionary; and preventing or limiting any employer deduction from tips, except for those required under tax law.

In addition, the government is considering whether to ban or restrict levying table sales charges on staff, and how to incentivise and increase the use of well-managed tronc systems – a scheme where tips are distributed to all employees.

“We’ve been very clear. As a one-nation government we want workers who earn a tip to be able to keep it,” said Javid. “That’s why I, like many others, was disappointed by the tipping practices of some of our well-known chains. This has to change.

“I’m setting out our proposals to make tipping fairer, clamping down on unfair practices and securing a better deal for the millions of workers in the service industry. We will look closely at all the options, including legislation if necessary.”

The proposals follow a call for evidence launched in August 2015. The government received 200 responses and said there was “broad agreement” that currency practices were not clear for workers or consumers.

According to the response, worker groups called for a requirement for 100% of tips to be paid to workers. The majority of customers would prefer to see all tips either going to the employee (61%) or shared in a tronc without any employer control (23%).

Employers were more supportive of retaining the current treatment of discretionary payments for service; maintaining their flexibility to reward workers but increasing the transparency of actions.

The “Tips, gratuities, cover and service charges: proposals for further action” consultation closes on 27 June. Click here to read the proposals in full and share your views.