UK govt backtracks on tips legislation
Trade union Unite has criticised the UK government after it published a factsheet that reveals full control of tip allocation will not be handed over to workers.
New legislation on tipping came into effect on 1 October 2024, which made it unlawful for employers to withhold tips and service charges from staff.
However, the Employment (Allocation of Tips) Act 2023 fell short of giving employees the power to decide where tips are allocated, as the Labour Party had pledged. Employers were still able to decide which workers received tips, with the potential to supplement the wages of managers and back office staff.
New guidance states that employers must now consult the workforce before publishing their tipping policy, which must be reviewed and reconsulted every three years. This will come into effect from October 2026.
However, the factsheet does not state that full control of tip allocation will be given to workers. Instead, it has a section that explains why this is not the case, and in which it describes its policy as “a significant step forward in promoting the voices of trade union representatives and other workers.”
It goes on to say that “direct worker control” could risk certain groups “being disadvantaged by a ‘tyranny of the majority’ or even indirect discrimination against workers with certain protected characteristics”.
Unite has criticised this language, claiming it is “insulting” and demeans collective bargaining.
The union believes the latest law change makes workers more vulnerable to losing tips, as it puts the onus on guidance and consultation instead of offering a firm policy on collective bargaining and instating fines for employers that keep tips.
Unite general secretary Sharon Graham said: “The government’s factsheet is wrongheaded and offensive to hospitality workers; it needs to be withdrawn and redrafted.
“Using language such ‘tyranny of the majority’ of workers totally fails to appreciate the employment conditions of hospitality workers. The dangers of discrimination and unfairness will come from imposing a tips policy without the workers’ voice.
“The suggestion that vulnerable workers would be disadvantaged by a workers’ tips policy is simply insulting. Many workers in front-of-house positions are low-paid, young women and migrant workers.”
The Spirits Business has requested a comment from the government.
Unite hospitality lead organiser Bryan Simpson added: “The strongest antidote to unscrupulous practices such as tips theft isn’t consultation – it’s collective bargaining.
“Real power comes from giving workers the right to organise, negotiate and win the pay and conditions that they deserve. All this U-turn will achieve is hurting hospitality workers by allowing employers to still manage tips unfairly. Unite will carry on campaigning and organising until tips theft becomes a thing of the past.”
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