Restaurant firms will finally be banned from creaming off their employees’ tips after SIX years of Tory delays.
Ministers today confirmed they will change the law to force bosses to pass on 100% of tips and service charges to staff.
They will also consult this year on a Code of Practice, setting out a “fair” way for tips to be split between waiters and kitchen staff.
And workers will get new rights to request information on their employer’s tipping record, to prove they have been treated fairly.
Restaurants and bars that break the rules could lose an Employment Tribunal.
Ministers decided to act after the number of cash tips plummeted during Covid, with 80% of all UK tipping happening by card.
But the law is not expected to change until late 2022 at the earliest – six years after the Tory government first mooted a shake-up.
Any legal change will now be in the long-awaited Employment Bill, which is not expected until the next Queen’s Speech.
The Department for Business said the move towards a cashless society had “accelerated dodgy tipping practices” as firms find it easier to keep funds.
It said 2million workers will benefit from the change.
Labour Markets Minister Paul Scully said: “Unfortunately, some companies choose to withhold cash from hardworking staff who have been tipped by customers as a reward for good service.
“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 Mirror reported the latest move on Sunday after it emerged in a Sunday newspaper.
The issue was first highlighted several years ago when it was revealed chains including Cote and Bills were adding service charges and then topping up managers’ salaries with the proceeds.
This left front of house workers “taking home limited amounts of tips”.
Typically, managers were paid the minimum wage on the understanding that their salary would be topped up to between £35,000 and £40,000 a year through the tronc systems.
Meanwhile chains including Prezzo, Zizzi and Pizza Express used to deduct between 8 and 10% of tips from employees. All three chains have since reversed the policy.
It has already been illegal for bosses to count tips towards an employee’s minimum wage since 2009.
Unite said the delay has cost waiting staff £2,000 a year. The union’s general secretary Sharon Graham said: “It’s shocking that this group of mainly young workers has had to wait five years for government action to tackle the tips scandal.
“We will continue to challenge abuses in the workplace and Unite will keep fighting to improve the jobs, pay and conditions of the hospitality workforce.”
Graham Griffiths, Director of the Living Wage Foundation, said: “Any move to improve pay in low-paid sectors like hospitality is welcome, but if this work is to be truly valued we need to see more people lifted onto a real Living Wage.
“We all need a wage that meets our everyday needs, but too many people are stuck on pay that leaves them struggling to stay afloat. Paying a Living Wage is good for businesses, the economy, workers and families.
“To build a stronger and more dynamic economy our focus should be on increasing the number of businesses doing the right thing and committing to pay a Living Wage.”Internet Explorer Channel Network