New tipping law comes into force

01 Oct 2024

Businesses have been banned from withholding tips or service charges from their staff under new rules that come into force on 1 October.

All tips, whether in cash or by card, must now be shared between workers by law in Britain, with millions of workers such as those working for cafes, pubs, restaurants, taxi companies and hairdressers most likely to benefit.

If an employer breaks the law and retains tips, a worker will be able to bring a claim to an employment tribunal.

The law means tips must be passed to employees by the end of the following month from when they were received.

The Department for Business and Trade has predicted the new law will mean a further £200 million will be received by workers rather than their employers.

Katie Nicholls, Chief Executive of trade body UKHospitality, said: 'The people working in hospitality are the lifeblood of our sector and these changes rightly ensure tips hard-earned through excellent service will end up entirely in their pockets.

'New rules naturally come with an administrative burden and businesses will see some additional cost as they work through them in practice.'