The new proposed legislation would bring about a range of changes for the hospitality industry, increasing costs for business owners and introducing a range of factors that require consideration. Businesses found guilty of not complying could expect a hefty fine of up to £5,000 for every reported case, forcing their hands to fairly distribute all tips, gratuities and service charges amongst employees.
According to the proposed legislation, employees have a right to request their tipping record once every 3 months, which they can use as evidence to support their claim if they recognise any inconsistencies or unfair tip allocations. Therefore, businesses would need to identify a way of recording and distributing tips amongst employees, which also needs to be recorded as a written policy.
Whilst the legislation is beneficial for workers, business owners would have to consider a range of factors in order to fully comply with the legislation and ensure the fair distribution of tips amongst staff. Factors such as; whether to include kitchen staff, length of time working for the employer, employee performance and role, customer tipping intention and more.
Whilst there’s no set date legally by which business owners have to pay their staff tips, the legislation recommends that they do it no later than the end of the month in time with people’s wages.
