A consultation that studied companies taking a cut or ‘handling charge’ of tips given to staff at bars and restaurants concluded in June 2016, yet a Freedom of Information (FOI) request by The Independent newspaper revealed ministers had not yet produced a draft copy of a response.
Following the consultation, the Government announced proposals to prevent or limit any employer deduction from discretionary payments for service, except for those required under tax law.
Recommendations in 2016 included “updating the current voluntary code of practice and putting it on a statutory footing to increase employer compliance”.
A spokesperson for the Department for Business, Enterprise and Industrial Strategy (BEIS) told The Independent the Government was “still considering options and will respond in due course”.
Ripped off by rogue bosses
Labour MP Stephanie Peacock told the newspaper ministers were being complacent while “workers and customers alike are being ripped off by rogue bosses”.
A voluntary code of practice was introduced in October 2009 to increase transparency regarding tips, gratuities, cover and service charges. However, some chains still take a cut of staff tips.
The British Hospitality Association (BHA) code commits companies to displaying information on how proceeds of the service charge are distributed to staff and on whether a percentage of the charge is held back.
Brigid Simmonds, chief executive of the British Beer & Pub Association (BBPA) said the group had consistently supported the BHA code.
She said: “BBPA members collect and distribute tips in a variety of ways to ensure that all the tips received are given to staff.
“We would be happy to work with the Government to ensure that this policy is fair and works in practice.”
Guidance on fair systems
UKHospitality chief executive Kate Nicholls said the organisation would continue to guide members to “ensure that hard-working staff receive the tips they deserve”.
She said: “UKHospitality responded to the Government’s consultation on tipping in 2016 and has produced guidance for its members on establishing transparent and fair tronc systems that ensure staff receive their tips and tax is collected appropriately.
“It is important to note that we have still seen no widespread evidence of malpractice or misuse of tipping practices among our membership.”
Announcing the proposals two years ago, former business secretary Sajid Javid said he was keen to see tipping practices change.
“We’ve been very clear. As a one nation Government, we want workers who earn a tip to be able to keep it. That’s why I, like many others, was disappointed by the tipping practices of some of our well-known chains. This has to change.
“Today, I’m setting out our proposals to make tipping fairer, clamping down on unfair practices and securing a better deal for the millions of workers in the service industry. We will look closely at all the options, including legislation if necessary.”