National minimum wage, troncs and the Employment (Allocation of Tips) Bill

With the Employment (Allocation of Tips) Bill expected to be passed this spring now is the time for employers to understand what the new legislation means to them and to consider any actions necessary to ensure they are meeting their obligations.

The bill is progressing through the House of Lords and is on track to legislate against businesses withholding tips and service charges from their employees (including agency workers). In a business sector that typically pays close to the national living/minimum wage (NMW) rates this would be a welcome boost to more than two million workers in particular at a time when the cost of living is soaring but it could create an unintended headache for employers.

Under the bill employers would be bound to ensure that all tips are allocated fairly and by the end of the following month when the tips were given....