New tipping rules come into force tomorrow - and workers will take home more cash

From tomorrow, restaurants, coffee shops, cafes and other hospitality venues will be banned from withholding tips from their workers meaning staff will take home more pay

Millions of bar, restaurant and other hospitality and service workers will be able to take more cash home from work as a new law on tipping is to be introduced tomorrow.

From tomorrow, restaurants, coffee shops, cafes and other hospitality venues will be banned from withholding tips from their staff. The new rules mainly cover the hospitality industry, however, it does cover any business which allows tipping such as hairdressing.

Cash tips were already protected, but the new legislation extends this to cover card payments. The law was initially set to come into effect from July, but was delayed. The new law is estimated to see around £200million put back into the pockets of workers each year through tips, gratuities and service charges.

Under the new legislation, if an employer breaks the rules they could be taken to an employment tribunal which could result in fines and potential compensation payments for the worker.

The government has a draft statutory code of practice which sets out how tips should be distributed to demonstrate "fairness and transparency". Employers and businesses should also have a written policy on tips and need to record how they manage them.

As part of the new rules, employees have the right to request information about an employer's tipping record. This will allow them to bring credible claims to an Employment Tribunal if the rules are not followed. Employers are also not allowed to alter someone's salary or hourly to include gratuities so they can't count towards the minimum wage. Tips must also now be paid within one month and they must be allocated fairly between all workers, including those on zero-hour contracts.

Many hospitality workers often rely on tips to supplement their income and have often been left powerless when businesses fail to pass on service charges from customers. ‌In 2015, research found that many owners of restaurants, bars, and cafes added discretionary service charges to customers' bills but then keep some of the money themselves. ‍ ‌ ‌ ‌ ‌

In the same year, a Government consultation found customers were "overwhelmingly" in favour of the tips they paid going to the people who served them. This issue was first discussed in 2016 after malpractice and unfair distribution of tips was exposed.