New legislation on allocation of tips and the corresponding Code of Practice is set come into force on the 1st October 2024. This was confirmed by commencement regulations for the Employment (Allocation of Tips) Act 2023 and Code of Practice which have been laid out by Parliament.
The key features to note from the Act are as follows:
- Employers are required to pass on tips in full to workers;
- Tips must be allocated in a fair and transparent way;
- Employers of businesses where tips are left more than occasionally are required to have a tipping policy in place;
- Tips must be distributed within one month following the month in which they were received;
- Workers have a right to request a copy of their tipping record to enable them to bring a claim to the employment tribunal where they believe they are not receiving tips they should be;
- Employers are required to maintain a record of how every tip has been dealt with for three years from the date the tip was paid; and
- Employers must have regard to the new statutory Code of Practice when distributing tips.
Written by Lucy Williams FCILEx
Head of Employment Law and HR at Key Group Services Limited