Three Key Points for Restaurateurs to Prepare for the New Tips Bill

Three Key Points for Restaurateurs to Prepare for the New Tips Bill

The Employment (Allocation of Tips) Act comes into effect this October, the restaurant industry is set for a significant shift. Tipping has long been a hot-button issue, with calls for stricter regulations to guarantee fair distribution of gratuities and service charges.

So what is all the fuss about? The golden rule of this act is starting on October 1st, it will be illegal for businesses to withhold tips from their employees, ensuring that staff receive the tips they rightfully earn. 

So how can prepare your restaurant for these changes? Here are our three key points to ensure a smooth transition for your restaurant while keeping your team motivated and compliant with the new law.

To help you get ready, here are three essential considerations for restaurateurs before the Employment (Allocation of Tips) Act comes into effect.

Plan Your Finances Early
The new Act will introduce additional costs for operators, including extra administration for record-keeping and fees on card payments for tips and service charges. Previously, businesses could use some of this money to cover card commissions and bank charges, but this will no longer be allowed. Businesses need to include these costs in their 2024 budgets. 

Familiarise Yourself With The New Law
The Act sets several broad requirements, such as passing 100% of tips to staff and prohibiting large groups from pooling tips across multiple sites. Workers will also have a new right to request information about their employer's tipping records. However, many details are yet to be clarified, which is where the Code of Practice comes in. For a comprehensive guide download our guide here.

Evaluate Your Tipping Platform
Businesses not currently using a tronc system must decide whether to adopt one before the Act is enforced, as making changes afterward could be challenging. While using a tronc system is not mandatory under the legislation, alternatives like cashless tipping platforms are available. Platforms like EasyTip, offer ways to manage digital tips transparently and fairly. EasyTip, for instance, allows tips to bypass the business and go directly to staff, ensuring compliance with the new laws.

Why EasyTip?

With EasyTip, earning cashless tips is quick, easy, and completely transparent for business owners, staff, and customers. As the Employment (Allocation of Tips) Bill introduces significant changes, EasyTip offers a seamless solution to help hospitality and service staff adapt efficiently and comply with the new regulations.

By considering these points, restaurateurs can better prepare for the upcoming changes and ensure they comply with the new tipping laws, ultimately benefiting their staff and operations. Interested in learning more book a demo now.