Government moves forward with plans to ban operators taking a cut of staff tips

A bill banning hospitality businesses from taking a cut of staff tips has had its second reading in parliament, despite having been dropped from the Queen’s Speech just two months ago.

Tipping legislation was thought to have been dropped from the government’s agenda after no mention of the Employment (Allocation of Tips) Bill was made at the opening of parliament in May.

However, today (15 July) it received backing at its second reading and will progress to the committee stage for scrutiny.

If passed into law it will ban businesses from withholding cash or card tips and give more than two million UK workers the right to request information on an employer’s tipping record, enabling them to bring forward a credible claim to an employment tribunal.

A statutory Code of Practice will be developed to provide businesses and staff with advice on how tips should be distributed.

Business minister Jane Hunt said: “At a time when people are feeling the squeeze with rising costs, it is simply not right that employers are withholding tips from their hard-working employees.

“Whether you are pulling pints or greeting guests, today’s reforms will ensure that staff receive a fair day’s pay for a fair day’s work – and it means customers can be confident their money is going to those who deserve it.”

UKHospitality chief executive, Kate Nicholls, added: “Tips and service charges provide a significant and welcome boost to hospitality employees’ take-home cash. So we’re delighted to see this proposed legislation recommend that employers can set a fair distribution policy for staff, meaning they all benefit. This should also reassure prospective hospitality sector workers at a time when the industry is seeking to fill vacancies.”

The journey to the bill has been long, beginning when then business secretary Sajid Javid launched a consultation into tips, services and troncs in 2016. Legislation eventually came forward in the form of a Private Member's Bill by Dean Russell, Conservative MP for Watford.

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