The Employment (Allocation of Tips) Act 2023 has recently received Royal Assent, says Joanne Holborn of Baines Wilson LLP.
The Act requires employers to ensure all tips and service charges are allocated fairly between its workers (not just employees).
What will be considered as ‘fair’ allocation is not defined in the Act, however, employers are required to have regard to a Code of Practice which will be issued for consultation in due course. Employers will also have to keep records of all tips and service charges received for three years.
The Act also compels employers to have a written policy on how they deal with tips.
