ICB reminds members of the commencement of the Tipping Act from 01 October 2024.
The Employment (Allocation of Tips) Act 2023 received Royal Assent in May 2023 and The Employment (Allocation of Tips) Act 2023 (Commencement No. 2) Regulations 2024 bring this and the statutory Acas Code of Practice into force on 01 October 2024. From this date, for workers (including agency workers), employers in Great Britain are required to:
- Pass on all tips and service charges
- Ensure they are distributed in a fair and transparent manner
- Have regard to the Code of Practice on fairness and transparency of tip distribution
- Maintain a written policy on how tips are dealt with at their place of business and ensure this policy is made available to all their workers, and
- Maintain a record of all tips paid at their place of business and their allocation and distribution between each worker
For Bookkeepers
Regardless of how the tip or gratuity is allocated, there is no change to the way they are subject to a tax or National Insurance liability. The legislation and Code of Practice only concern how employers allocate them to workers.
This is important for members to note. Where you have clients in the hospitality industry, it may be helpful to pass on the Acas Code of Practice whilst advising them they may need to change their ways of allocating tips, gratuities and service changes to remain compliant.
