Tipping: Code of Best Practice

Guidance on Transparency for Workers

Businesses that comply with the Code should ensure that their employees understand the policy relating to service charges, tips, gratuities and cover charges. This means that businesses should ensure that all workers:

• understand the process for the distribution of service charges, tips, gratuities and cover charges between the business and the workers, and between the workers themselves (for example, workers should be told if a tronc operates and who the tronc master is)
• are aware of the amount and purpose of any deductions from service charges, tips, gratuities or cover charges, and seek to reach agreement with workers on any policy change
• have access to a written statement setting out the business' policies on service charges, tips, gratuities and cover charges which can be provided to consumers
• are aware of the level of deductions from tips, service charges and gratuities made to cover breakages, till shortages or customer walk-outs
• are aware of the business' grievance procedure

Businesses should give information to workers in the form of a written statement. Where the business employs a cohort of workers where English is not the workers first language the business should consider making information available in other languages.

This statement should include:

• how tips are distributed and, if applicable, if this is done through a tronc
• if cash and card tips are treated differently
• the name of the tronc master if appropriate
• how much might be deducted for administration and what this covers
• any other deductions
• what happens during holidays, sick leave, parental leave and other forms of leave

Where tips are passed to workers without national insurance deductions, workers should be informed that this may have implications for entitlement to certain social security benefits.

© 2009 Crown Copyright