Article
6 min read
Tipping point: why it’s time to take Fair Tips Act action
Thomas Dibble
Sep 9, 2024
The playlist
Tip-tock, tip-tock… The clock is ticking down to October 1, 2024 when the UK’s new tipping legislation comes into force. And, make no doubts about it, it’s really coming this time. And when it arrives, it’s going to shake the entire hospitality industry up. If you haven’t made a plan for how you’re going to comply with the new law, you’re running out of time to get everything ready. The last thing you want to be faced with is a last-minute scramble to keep yourself from being the first one to get it wrong.
To get to the bottom of what this new legislation means for hospitality business owners, we sat with Andy Hamman – Director of Tronc Services – The Tronc Advisor. TiPJAR is a tipping platform that enables customers to easily register tronc and cashless tips – and divide them in line with the new Fair Tips Act. It also played an important role during the government’s consultation period, and helped advise how to implement the new rules.
“The new legislation presents the biggest shake-up for hospitality in decades. It sets a level playing field for operators in dealing with tips and service charge. The key goals of the Act are to ensure fairness and transparency. Hospitality workers will be entitled to receive 100% of the monies left by customers, intended to reward the service received.”
Remind me what’s changing…?
Basically, from 1 October 2024, all tips must go directly to workers. They can’t be used for any other purpose. The new law’s all about treating team members fairly, and being as transparent as possible. As an employer, you’ll have to distribute tips evenly among your team, in line with a new code of practice.
This means record-keeping is going to be vital. Because you’re going to have to track how tips are distributed, and be ready to prove your compliance if need be.
TiPJAR's tips for why it's time to act
The law’s straightforward, but implementing a solution to it for your business needs a bit of planning. That’s why you need to act now, because:
1. Getting it wrong will be expensive
The first businesses to trip up under this new legislation probably won’t just face fines, but media scrutiny too. By getting everything sorted now, you can avoid making the headlines for the wrong reason.
2. Dot the Is and cross the Ts
With less than three weeks to go until October 1, you’re running out of planning time. But there’s still plenty of it left to review and check you’re compliant – even if this leaks over into October. After all, it’s better to do something than nothing at all.
3. Trust is a two-way street
These new regulations aren’t just about compliance. They’re about creating a more fair and transparent working environment, where your team feels valued and respected. By showing your staff you’re on top of these changes demonstrates you’re taking them seriously, and will help build trust and morale.
4. You scratch my back…
Providing your team with transparency (and access) to the tips they’ve earned motivates them to focus on service. After all, good service means better tips. It’ll also encourage them to apply for busy weekend and seasonal event shifts.
"The Fair Tips Act might feel like a mere obligation to you as a business owner, but increasing transparency and fairness towards your staff, will actually benefit you in the long run. Being treated fairly and being able to see how good service affects your pay in the form of higher tips, will actually create higher job morale and increase the job happiness among staff"
Prepare for the Fair Tips Act with Planday and TiPJAR
The media spotlight will fade – for a bit
Right now, everyone’s talking about the new tipping law. But once it’s here, the media’s attention will fade. Until the first business gets it wrong, naturally. Don’t let it be yours. Complying with the law is important – and so is being seen to comply. The reputational damage of getting it wrong could be more long-lasting and costly than any fine; it could cost you customers and team members, now and in the future.
Get ready for the changes today
Review your current tipping practices
Start by examining how tips are currently managed in your business. Are they being fairly distributed? If not, now’s the time to make changes.
Educate, educate, educate
Begin training sessions as soon as possible so everyone on your team understands the new rules, what they mean, the solution you’re implementing and how to use it.
Keep accurate records
Set up a process for tracking tips and how they’re distributed. If you ever need to prove you’re following the new law, this will be vital in showing your compliance.
The UK’s new tipping legislation is almost here. There’s still time to get your business ready for the new changes and to keep yourself from getting it wrong in October. Don’t put it off any longer.
Learn everything you need to know about the Fair Tips Act
Our complete Fair Tips Act cheat sheet covers everything you need to consider before the law comes into play – and how Planday and TiPJAR can help your business get ahead of the changes.
Start giving a shift, with Planday
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