Our Nicole McMahon, Lead HR Consultant, one of Gravitate HR’s newest members discusses what employers might expect with the fair allocation of tip provision which came into force on 1st October 2024:
Collect tips across your business for your staff? You’ll need to take note of this important regulation which came into place on 1st October 2024.
If like me, you wonder if there has been one month in recent years which has not afforded any employment/employer updates, you’d be thinking similarly to a lot of business owners and managers across the UK! We’re here at Gravitate HR to support your company and bespoke your HR services ensuring compliance with legislative updates and peace of mind.
The Employment (Allocation of Tips) Act 2023 comes into force on 01 October 2024. This controls how businesses allocate tips amongst their staff and introduces obligations to ensure that workers receive ‘tips, gratuities and service charges’ in full. It sets out ways that employers must evidence how tips are therefore allocated in a fair and transparent way.
The Act sets out ways employers should have a duty to allocate the tips fairly to workers (including eligible agency workers) and to meet the payment date of processing the tips. It suggests that a failure to comply with the Code will be admissible as evidence in employment tribunal proceedings should these not be evidenced and accurately distributed.
What’s important for us (in HR and employment law) is that this provision introduces a new Part 2B (sections 27C to 27Y) into the Employment Rights Act 1996 (ERA 1996) meaning that there could be financial risk if you do not meet the requirements of this new legislation from 01 October 2024. It’s worth noting that there may be an order at tribunal to pay compensation of up to £5,000 for any financial loss suffered by employees should employers not meet the Acts fair allocation of tips.
The Act goes on to discuss occasional and exceptional circumstances which we can explore with you if you find that your business requires additional support to maintain your Tips Policy, TRONC management and documentation.
Remember, at Gravitate HR we are here to help. If you’d like to discuss this further book a call with your Account Manager or schedule a call with our team if you haven’t worked with Gravitate HR before.
“Lastly, Nicole what do you do outside of work?”
You’ll either find me running a trail path or in a Yoga studio teaching or sharing an asana or pranayama/meditation practice. Yoga is the Yin to my Employment Law Yang and I love to bake… so if I’m not summiting a Scottish Munro or in the Yoga studio, you’ll definitely find me in the kitchen trying a new cake recipe.
Over the upcoming weeks, we will be releasing blogs, in addition to our guides, that will help you navigate through the upcoming legislative changes post 01 October 2024.
Missed the guides? Do not worry, you can access them here and all you have to do is pop in your email!
Want to find out more about our services or how we can help? Why not book a call with us, 20 min call – Gravitate HR.
Keep an eye out on our LinkedIn for what we are working on and to get to know the team!
Follow up on our most recent blogs here: Blog – Gravitate HR
