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Article Index
Tipping Code of Best Practice
Code of Best Practice Principles of Transparency
Guidance on Transparency for Consumers
Guidance on Transparency for Workers
Further Information
Model Statement for Workers
Definitions
List of Stakeholders
Page 3 of 8

Tipping: Code of Best Practice

Guidance on Transparency for Consumers

The Code states that:

  • Businesses will clearly display on their premises prior to the point of purchase or choice their policy relating to mandatory and discretionary service charges, tips, gratuities and cover charges, and make this accessible.
  • Businesses will have a process in place to deal with requests from customers about how and to whom all service charges, tips, gratuities and cover charges are distributed, and the level and purpose of deductions.

Businesses must apply these principles in line with legal requirements of the Consumer Protection from Unfair Trading Regulations. Information provided about service charges, tips, gratuities and cover charges must not be misleading under the terms of these Regulations. Enforcement of the Regulations is the responsibility of the Office of Fair Trading. All complaints from either consumers or others relating to misinformation can be made to the Consumer Direct Helpline on 08454 040506.

When?

Businesses should ensure that information about service charges, tips, gratuities and cover charges is made available to consumers on the premises and before they make the decision to make any discretionary additional payment.

What?

The information should cover:

  • whether a charge is mandatory or discretionary
  • whether an amount is deducted by the business to cover costs incurred in handling these charges (deductions could be credit card and banking charges, and/or payroll processing costs)
  • whether cash tips and card tips are distributed differently
  • how the remainder is shared between the business and the workers

Where?

There are a variety of ways for the business to make the information easily available on the premises to consumers, for example:

  • clear and easily visible written information available on door stickers or wall notices or on menus displayed outside the venue
  • on the menu in the case of restaurants
  • in the reception area and/or at the gaming table in the case of casinos
  • information on the bill presented to the customer
  • information made available to customers in the bill folder in leaflet form or on the `tips' tray

In addition, businesses should ensure that workers can direct consumers to further information, for example a written statement setting out the business' policy on service charges, tips, gratuities and cover charges. Businesses may wish to make further information available through their websites or on promotional material.

Examples of disclosures that businesses may wish to consider using:

Example A

We are committed to the Code of Best Practice on Service Charges, Tips, Gratuities and Cover Charges

For every £1 received in card tips, the staff keep 70p, 10p covers business costs and administration and 20p goes to the business [this includes deductions for breakages, till shortages and walk-outs]. All cash tips go to the staff

Example B

We are committed to the Code of Best Practice on Service Charges, Tips, Gratuities and Cover Charges.

If you choose to leave a tip through a card, we will retain 10% to cover the charges we incur in processing your payment, card fraud losses and administration costs in distributing sums to staff and business costs [this also includes deductions for breakages, till shortages and walk-outs].

The remaining 90% is allocated to the staff in the business and is shared out through a system controlled by a staff representative.

All cash tips go to the staff.

Or

For every £1 received in card tips, 90p is shared amongst the staff and 10p covers administration, processing and business costs [this also includes deductions for breakages, till shortages and walk-outs]. All cash tips go to the staff.

Example C

We do not add a service charge to your bill.

100% of the tips you leave are distributed amongst the staff according to their wishes.

© 2009 Crown Copyright



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