Proposed ban on restaurants keeping tips

The Prime Minister has this week announced plans to introduce legislation banning employers from making any deductions from tips given to their workers.

Last year, a voluntary code of conduct on tipping was agreed between the ALMR and Unite and was designed to promote good practice across the industry. The code sets out “good tronc principles” – a tronc is an arrangement used to distribute tips.

The jointly agreed principles of a good tronc include:

  • Independent and free from undue influence by any one party – troncmaster and the tronc committee elected by staff and accountable to staff. No direct company involvement on tronc allocation or decisions.
  • Transparent and open in its dealings – all tronc rules, decisions and methods of allocation readily accessible and available to all staff. Tronc to be audited quarterly by staff who are not the troncmaster or tronc committee.
  • Fair and genuine allocation – no hidden charges or admin fees imposed by employer. No deductions for walkouts, breakages, performance.
  • Genuine engagement – genuine and meaningful consultation with all staff on any changes to rules and process proposed by troncmaster and tronc committee before decisions are agreed.
  • Provides for dispute resolution.

However, despite this, no legislation is currently in place preventing employers deducting sums from the tips received by their workers.

While no timeframe has been given on the proposals, it would be advisable for employers in the hospitality industry to review their policies on tips given to their staff. Doing so will leave employers well prepared for the announcement of further details on and the implementation of this legislation.

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