UK Enacts New Law to Ensure Workers Keep 100% of Their Tips

A new law in the UK mandates that restaurant and eatery workers keep 100% of their earned tips. Effective from Tuesday, the Employment (Allocation of Tips) Act ensures fair distribution of gratuities. Employers found violating the law will face penalties, creating a more transparent tipping system.

Starting Tuesday, restaurant and eatery workers across the UK will keep 100 per cent of the tips they earn, thanks to new legislation.

The Employment (Allocation of Tips) Act, introduced last year through a Private Members' Bill, mandates that all gratuities, including service charges, be passed on to workers without deductions. If employers fail to comply, workers can now bring claims against them in employment tribunals.

UK Minister for Employment Rights Justin Madders praised the move, calling it a crucial first step in protecting workers and ensuring fair compensation. Additionally, the Department for Business and Trade (DBT) estimates that the law will redirect approximately GBP 200 million annually to workers. While most employers already follow this practice, the new law aims to standardize tipping practices and hold the minority of non-compliant businesses accountable.

(With inputs from agencies.)