Tip deductions costing UK hospitality workers £200m a year, Labour claims

By James McAllister

- Last updated on GMT

Tip deductions costing UK hospitality workers £200m a year, Labour claims

Related tags tipping Government Legislation Service charge Labour ukhospitality

Labour has pledged to 'stamp out' unfair tip deductions, claiming that hospitality and leisure workers are missing out on around £200m a year.

Angela Rayner, Labour’s deputy leader, will set out plans this week to ensure employers allocate all tips, gratuities and service charge payments to workers in full, without any deductions apart from statutory taxes, by the end of the following month, The Guardian ​reports​.

At the Trades Union Congress conference in Brighton, she will also announce proposals to allow exploited workers to lodge any workplace grievances collectively, a right denied to many hospitality workers seeking the return of deducted tips.

Tipping has been a long-debated issue in Parliament, with the Conservatives previously committing to tackling the issue of the unfair distribution of tips in its 2019 manifesto, and in the employment bill that was dropped from the last two Queen’s speeches.

A Government-backed private member’s bill is currently making its way through Parliament, but Labour has said it does not close loopholes that allow employers to choose how tips are distributed.

The bill, put forward by Conservative MP Dean Russell in June last year​, would see hospitality operators forced to hand over all tips to staff, and was largely welcomed at the time by UKHospitality. However, following the bill's second reading earlier this year​, the trade body said there were a few additional issues that needed addressing.

Rayner, who is shadow secretary of state for the future of work, told The Guardian​: “It is disgraceful that time and again this government has allowed hospitality workers to be cheated out of their own money, with staff losing up to £1bn over the past five years of Tory inaction.”

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