How employers pass on tips, gratuities and service charges to their employees
The Call for Evidence will look at how restaurants treat tips left by customers and whether government intervention is necessary to strengthen the voluntary code of practice run by the industry.
The inquiry will seek information and views from the hospitality industry and other key stakeholders and will consider whether there should be a cap on the proportion of tips restaurants can withhold from staff for administrative costs and, if so, what this level should be.
Research from 2009 found that one in five restaurants did not pass tips to their staff, yet the vast majority of customers said they wanted the waiting staff to receive tips left for them. More than three quarters wanted to clearly see the restaurant’s tipping policy displayed clearly.
While there is a voluntary code of practice which is overseen by industry body the British Hospitality Association, restaurants may currently choose to ignore its 4 principles of transparency and adopt various tipping practices.
The Call for evidence has been launched by the Department of Business, Innovation & Skills (BIS) and will run until 10th November 2015.
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