ARE YOU AWARE OF THE EMPLOYMENT (ALLOCATION OF TIPS) ACT 2023?
What’s the story?
From October 2024 the UK Government will enforce a new law that impacts the entire hospitality industry. Specifically this will impact how businesses collect, process and distribute staff tips.
The Employment (Allocation of Tips) Act 2023 has a number of key impacts on businesses;
- Must allocate tips fairly across the team that earned the tips.
- Records must be maintained of all tips collected.
- A written ‘Tipping Policy’ must be in place and accessible by customers and staff.
- Tips must be paid within 1 month of being given.
- No deductions from a given tip can be taken (such as card fees, admin charges, processing fees).
So, if you have a jar with loose change in it, distributed by a manager every now and then or, you're collecting tips on the card machine, deducting card fees and processing fees before paying out, you could face penalties for either scenario which isn't compliant for up to £5,000 per claim.
What should you do about it?
There are some key changes that must be made before July 2024 in order to ensure business remain the right side of the law.
If you are collecting in cash;
- Keep records of all tips & payouts Distribute 100% of the tips every month.
- Write a policy of allocation.
If you are cashless;
- Implement a digital tipping solution to ensure you are compliant.
Read about the new regulations for yourself here - https://lnkd.in/e_W8iG7A
A massive thank you to RWRD Tipbox for sharing this information with us.
TipBox has been handling tips within the coffee industry since 2022, closely following the recent law changes. TipBox offer a simple solution to ensure your shop is fully compliant with all regulations, and your team are collecting maximum tips.
What does TipBox Offer:
- Instant cashless tip collection on small counter top device
- 100% of the tips are directly paid to staff within 1 month
- Fair allocation based on hours worked
- Complete records of every tip & every payout
- Tipping Policy for your business to reference.
*This post has been edited with the updated compliance date which was July 2024 and is now October 2024.
