Government to outlaw use of tips to make up minimum wage
The Government has announced that it is outlawing the use of tips to make up the national minimum wage from 1 October 2009.
At present service charges, tips, gratuities and cover charges paid to staff through the payroll can count towards discharging the obligation to pay the national minimum wage. On 19 November 2008, the Government launched a consultation on proposals to amend the National Minimum Wage Regulations 1999 (SI 1999/584) so that service charges or tips can no longer count towards the minimum wage. It has now published its response to the consultation and announced that this practice will be outlawed from 1 October 2009.
- October go-ahead for fair tips Read the Government's announcement on the News Distribution Service website.
- Government response to consultation on: service charges, tips, gratuities and cover charges (PDF format, 230.4K) Download the Government's response to the consultation from the BERR website.
- Service charges, tips, gratuities, and cover charges: a consultation (PDF format, 298K) See the initial consultation document (on the BERR website).
Also
The national minimum wage The XpertHR employment law manual explains the law on the national minimum wage.