Five things to be aware of ahead of new tipping legislation becoming law

With new legislation around the management and distribution of tips and service charge expected to achieve royal assent by spring hospitality operators need to understand what changes will be required to be compliant.

Peter Davies, managing director, WMT Troncmaster Services, who will speak at The Caterer’s Tipping and Payment webinar on Tuesday 21 February, has highlighted five key points from the Employment (Allocation of Tips) Bill.

• All of the money collected through tips and service charge paid by customers must be paid to workers. It will no longer be possible to cover the administrative costs of collecting and distributing tips and service charges including credit card fees and commissions from funds gathered. These costs must now be covered by the business.

• There will be a strict timeline for distribution of money. Monies received from customers must be paid to workers by the end of the month following the month of receipt.

• Agency staff are to be given new rights and must be awarded tips and service charge on the same basis as directly-employed staff.

• Businesses will be required to keep more detailed records about the collection and distribution of tips and service charge. These can be requested by staff and could be used to challenge businesses at employment tribunals, including over issues of fairness where no independent tronc exists.

• It won’t be possible to change staff contracts, even with consent, to introduce tronc systems if it affects wages. Businesses who currently don’t operate tronc may have a once and forever decision to make in advance of the new rules.

Davies will expand on these points and others during The Caterer’s Tipping and Payments webinar on 21 February. To sign up to attend click here.