Tips, gratuities, cover and service charges - a call for evidence

Overview

The payment of tips, gratuities, cover and service charges is prevalent in a number of sectors. Concerns have been raised about the treatment of such payments in the hospitality sector particularly in relation to the percentage of each payment that goes directly to the employer.

This call for evidence is to gather information on how tips, gratuities, cover and service charges are collected and current practice in relation to whether and how much employers deduct from their employees.

Why your views matter

The government is aiming to gather evidence on the prevalence of different practices in relation to tipping – including admin charge deductions, the use of pooling practices and charges falling to workers in relation to their sales. The government is also seeking evidence on the impact of these different practices on employers and workers. Finally, the government welcome views on some of the policy interventions the government could make to improve practice in this area. The government is seeking views and evidence on the impact of these options, or whether there are other options that should be considered.

What happens next

The Government will collate and assess the evidence gathered through this exercise, and may undertake additional consultative processes. The Government will then evaluate the extent of the problem and publish information on what further actions, if any, before undertaking a response.