Check what tips and service charges you're entitled to

From 1 October 2024, employers must pass on all tips to their workers. This is because of a new law known as the ‘Tipping Act’. 

Tips include money given to employees by customers, as well as service charges that are added to the bill.

If customers often give tips in your workplace, your employer must have a written tips policy. If customers only give tips a few times a year, your employer doesn’t need a written policy.

If you’re not sure if your employer controls tips, you should check if they have a tips policy. If they do have a tips policy, the new law says it must be fair and easy to understand. Your employer must keep records of all tips that are paid.

If your workplace doesn’t follow the new law, you can complain and your employer should take action. 

If customers pay you tips directly

If a customer directly gives you a tip in cash or through a tipping app it isn’t covered by this new law.

It’s your responsibility to pay tax on tips you get directly from customers.

Check if you’re protected by the Tipping Act

The new law applies if your employer collects tips and shares them out. For example, it might apply if you work in a:

• pub, bar, cafe, or restaurant

• hair or beauty salon

• casino

The new tipping law applies to:

• employees

• agency workers 

• people who have zero-hour contracts 

If you’re self-employed, these new rules won’t apply to you. Check your employment status.

Check how your employer has to deal with tips

The law applies to all tips that are collected and shared out by your employer. This includes tips that are paid in cash, as well as by card or through digital payment methods, like an app.

The law doesn’t apply to tips you get directly from a customer, and which you don’t give to your employer - this could be as cash or through a tipping app.

Check how your employer should share tips with workers 

Your employer doesn’t have to share the tips equally between workers. They have to make sure the process is fair, clear and reasonable.

For example, your employer might decide to give a bigger share of tips to staff who have worked at the company for longer.

Your employer can also consider the customer’s intention. For example, if the customer wanted to tip a particular worker, your employer might choose to give all of the tip to them. 

When your employer makes or changes their tips policy, they should check with staff that they agree with it.

You have the right to not be discriminated against at work because of something about you, like your sex, race or disability. This also applies to sharing out tips.

For example, the policy might be discriminatory if it means men get more tips than women. You can check if a problem at work is discrimination.

If you have any concerns about the policy, you should complain to your employer.

Check when you should get your tips

You should get your tips by the end of the month after they were given. 

For example, if a customer gives a tip on 12 October, your employer must give it to their workers by the end of November.

Check what your employer can take from your tips

Your employer might have to take some money from your tips to pay for any tax or National Insurance.

They can’t take anything else from your tips - for example, admin charges when tips are made using card payments. 

If your employer tries to take anything else from your tips, you can complain - even if they say your contract allows it or that you’ve agreed to it.

Check what to do if your employer hasn’t paid you what they owe you.

Your employer might arrange for a ‘tronc’ or a ‘troncmaster’ to organise the tips. This might be an independent business, or someone who works at your company.

The tronc or tronmaster is responsible for making any deductions for income tax.

You can check how troncs work on GOV.UK.

Tips and the National Minimum Wage

You usually have the right to get paid at least the National Minimum Wage. This includes if you’re:

• a casual worker

• on a zero hours contract

• an agency worker 

Your employer must pay you at least the National Minimum Wage before they add your share of tips. 

Check what to do if you’re getting paid less than the National Minimum Wage.

Check your employer’s tip policy

Your employer must make sure all their workers can access their tip policy. If you’re not sure where to find it, ask your employer. 

The policy should explain your employer’s approach to tips - for example, who’s responsible for sharing out the tips and how the tips will be shared.

You can also ask to see your employer’s ‘tipping record’. This is a record of all the tips that were paid to staff over the last 3 years.

If your employer doesn’t follow the rules

You should talk to your manager or raise a grievance if you:

• think they haven’t shared the tips out fairly

• can’t access their tips policy or tipping record

Your employer should have a fair process for dealing with your issue.

If you can't raise a grievance, or you've tried and that hasn't worked, you can take your employer to an employment tribunal. 

If your employer hasn't paid the right tips, you must start the employment tribunal process within 12 months.

If your employer won't let you see their tips policy or tips record, you must start the employment tribunal process within 3 months.

Check how to make an employment tribunal claim.

If you’re an agency worker

If the organisation you’re working for hasn’t followed the rules, you should complain to the person who is responsible for paying tips to you. This might be your agency or a manager at the organisation where you’re working.

If you’re not sure who’s responsible for paying tips to you, check the organisation’s tip policy or ask your agency.

If you’re an employer

You can get advice from the Advisory, Conciliation and Arbitration Service (Acas). 

Acas is an independent organisation that gives employees and employers advice about people’s rights at work. 

Check how to contact Acas on their website.