Thompsons Solicitors has welcomed the news that the Government will ban employers from using staff tips to bring their employees’ wages up to minimum pay levels.
Government Ministers have confirmed that the practice will be outlawed from October.
The announcement came in the wake of a long campaign waged by Unite the Union who described the government’s decision as “a triumph for the poorly paid in restaurants, bars and hotels across the country.”
Rory McPherson, Partner and Head of Employment Law at Thompsons said: “We applaud Unite for their determination to end this totally unacceptable practice. They have once again shown their effectiveness in campaigning for workers in general, as well as their individual members.
“The Government’s consultation process confirmed that members of the public are appalled to think that the tips they give lowly paid staff for exceptional service are being siphoned off by employers and used to make up staff wages.
“Unfortunately the practice is widespread throughout the leisure industry.”
The Government said the move will give greater transparency and clarity for customers in bars and restaurants through a new code of practice as well as avoiding exploitation of low paid waiting staff.
The change will benefit those working in industries such as restaurants, where tipping is commonplace.
Employment relations minister Pat McFadden said: "When people leave a tip for staff, in a restaurant or anywhere else, they have a right to know that it will not be used to make up the minimum wage.
“It is also important for employers to have a level playing field on wages.
"This is a basic issue of fairness. We do not believe employers should be able to use tips to boost pay to the minimum.
"Our consultation showed wide support for these changes, including from business groups, and we are working with them to ensure that consumers get the information they need."
The announcement was the government's response to a consultation on the use of tips, gratuities, service charges and cover charges in payment of the national minimum wage.
Derek Simpson, Unite's joint general secretary, said the government had done the right thing.
He added: "Hard-working waiting staff will be delighted to learn that bad employers can no longer line their pockets with the money that customers intended to go to workers.
"This is a triumph for the poorly paid in restaurants, bars and hotels across the country.
"However, there remains a need for a fully transparent tipping system where 100 per cent of tips go to staff."
Steve Brooker, markets expert for Consumer Focus, said: "This is a victory for common sense, for employees and consumers."
The Department for Business Enterprise and Regulatory Reform said businesses supported the change.