The government has responded to the consultation on the draft statutory Code of Practice on Fair and Transparent Distribution of Tips (the Code) that will support measures set out in the Employment (Allocation of Tips) Act 2023 (the Tips Act).
The response was published together with an updated Code and an explanatory memorandum. Commencement regulations will bring the measures in the Tips Act and the Code into force on 1 October 2024. The Code will be supported by non-statutory guidance which has not yet been produced.
The Tips Act will regulate how employers allocate tips among workers by introducing obligations to ensure that workers receive tips, gratuities and service charges in full, and that those tips are allocated in a fair and transparent way. Employers to whom the Tips Act is relevant will have to start taking steps to ensure compliance with the legislation and the Code. There will have to be system in place to ensure the fair allocation and distribution of tips, and employers will need to have a written policy and make arrangements for keeping records, as well as ensuring internal processes are in place to deal with requests for records.
