UK hospitality businesses, including pubs and restaurants, are being warned to ensure compliance with new tipping laws set to take effect from October 1st.
Lynne Blakey, director at wealth management and advisory firm Evelyn Partners, is advising employers to prepare for the changes introduced by the Employment (Allocation of Tips) Act. This legislation mandates that employers distribute 100 per cent of tips and service charges to staff without deductions.
Blakey, who has first-hand experience in the hospitality sector from her role as a former finance director at The Newt in Somerset, stressed that many businesses remain unprepared for the legal shift. “The new rules require tips to be distributed transparently and fairly, at the location where they were earned, within a set timeframe. This will affect employers who have previously held back tips or pooled them across multiple venues,” she explained.
The legislation also requires businesses to establish a formal written policy outlining how tips are managed and distributed, and to maintain accurate records. Employers must ensure fair tip allocation across all staff, including zero-hours and agency workers, who now have the right to request information on their share of tips if they suspect discrepancies.
Jamie Young
Jamie is a seasoned business journalist and Senior Reporter at Business Matters, bringing over a decade of experience in UK SME business reporting.
Jamie holds a degree in Business Administration and regularly participates in industry conferences and workshops to stay at the forefront of emerging trends.
When not reporting on the latest business developments, Jamie is passionate about mentoring up-and-coming journalists and entrepreneurs, sharing their wealth of knowledge to inspire the next generation of business leaders.
