It feels like we have been talking about a new law relating to tips for years now. So where have we got to and what happens next? 

Employment (Allocation of Tips) Act 2023‍

Under the Employment (Allocation of Tips) Act 2023, the law is due to change, meaning that businesses where tips, gratuities or service charges are paid on a regular basis will be required to: 

1. Have a formal written tipping policy, which is made available to all workers;
2. Pass on all tips to workers (normally without deductions), in a fair and transparent manner (having regard to a new statutory Code of Practice, the content of which has now been finalised).
3. Maintain a record of all tips paid, including their allocation and distribution to individual workers; and
4. Provide a record of tips paid to individual workers, on request. 

We had previously expected the new laws to come into force back in July 2024. However, what with one thing and another (including a General Election), this has now been delayed to 1 October 2024.‍

Action required?

For obvious reasons this new law won’t affect all employers. However, if your business regularly receives tips, you need to start getting yourself ready. We are on hand to provide you with the help and support you need to ensure that you are compliant. You may also want to take a good look at the new statutory Code of Practice. You can find it via the link here.