Tip deductions cost UK workers £200m a year, says Labour
Hospitality and leisure sector workers are missing out on about £200m in tips every year according to Labour figures, with the party pledging to “stamp out” unfair deductions for good.
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.
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.
The Conservatives promised to tackle the tips issue in their 2019 manifesto and also in an employment bill that was dropped from the last two Queen’s speeches, with Labour estimating that staff may have lost more than £1bn in tips since the government first promised action six years ago.
In the interim period, there have been a number of high-profile examples of workers being denied tips, including Pizza Express, which had to change its policy after union action earlier this year.
A government-backed private member’s bill is making its way through parliament but Labour says it does not close loopholes that allow employers to choose how tips are distributed.
The bill encourages firms to use independent “tronc” systems – a pay arrangement that lets businesses such as bars, restaurants, hotels or casinos fairly share staff tips – but Labour said this should be compulsory for firms with more than 20 employees.
Rayner, who is shadow secretary of state for the future of work, said: “It is disgraceful that time and again this government has allowed hospitality workers
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