Published on Thursday, October 22, 2015

Calls for legislation to make tipping more transparent

The Government is being urged to introduce legislation forcing hotels and restaurants to tell customers how service charges and tips are distributed among staff.

The British Hospitality Association has proposed the initiative to Business Secretary Sajid Javid as part of a Government inquiry into the issue.

"For us it's all about transparency," said BHA chief executive Ufi Ibrahim.

"Although restaurants are legally entitled to deduct administration costs from service charges, for example, we think it's important the customers understands exactly how much is deducted and why.

"Customers should be able to reward good service and know where their money ends up and how much of it goes to the staff."

Since 2009 it has been illegal for restaurant owners to use tips and service charges to bring wages up to the national minimum wage.

Many hotels and restaurants have signed up to the BHA's voluntary code of transparency on tips and service charges, but now the association wants to make it a legal requirement.

The BHA says businesses should be legally obliged to say if and how tips are shared between the employees, whether an amount is deducted for handling costs, and how much.

The government has launched an inquiry into the issue in the hospitality sector but also in other industries, such as hairdressing and casinos.

The deadline for responses is 10 November.

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