The Allocation of Tips Act 2023 came into force on 1st October. Employers have guidance on their new obligations in the form of a statutory Code of Practice on the fair and transparent allocation and distribution of tips. The government has now added to this by issuing non-statutory guidance. The non-statutory guidance includes:
- Clarification that tips cannot be pooled across multiple sites or different branches.
- A reminder that employers need to take account of agency workers when considering the distribution of tips.
- Confirmation that employers are responsible for deciding (and justifying) what roles they treat as being in-scope for the allocation of tips. They should incorporate all involved in providing direct service to customers.
- An outline tipping policy and tipping record template.
- A reminder that both failure to distribute tips and failure to provide tipping information can lead to claims in the Employment tribunal.
Whilst impacted employers are still getting to grips with these new rules, the government has announced further proposed changes. The Employment Rights Bill firms-up on the Act’s requirement for employers to implement and maintain a policy on tips, by requiring employers to submit to increased worker and trade union involvement in the process. In brief, the provisions require employers:
- To consult with trade union or worker representatives before implementing a tipping policy.
- To consult with trade union or worker representatives whenever the tipping policy is reviewed (which must happen at least once in the first three years after implementation and every three years thereafter).
- To publish a summary of comments gathered from these consultation processes.
It is important to remember that the Bill is currently going through Parliament and that these changes are unlikely to be implemented until 2026 at the earliest.
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Contact Jon Dunkley
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