The Government has approved the drafting of a law on tipping that would give new rights to workers. The bill would prevent employers from counting money received from tips as part of workers’ contractual rates of pay.

Restaurants will have to clearly tell customers how both card and cash tips, gratuities and service charges are distributed among staff under new legislation being brought forward by the Government.

Employment Minister Leo Varadkar says the aim of the Payment of Wages (Amendment) (Tips and Gratuities) Bill is to bring clarity to both staff and customers on just where the money paid goes. The new law will strengthen the rights of employees, prohibiting the use of tips and gratuities – but not service charges – to make up contractual rates of pay.

“This new law will, for the first time, give workers legal protections over tips. It will mean that any tips received cannot be counted towards an employee’s basic pay; they must be counted as additional and separate,” said Leo Varadkar (Tánaiste and Minister for Enterprise, Trade and Employment).

The Tánaiste added that the bill would provide clarity for customers and staff.

“Most establishments already treat their employees fairly with regard to tips, so for many it will mean no change, other than having to display their policy clearly,” he stated.

The electronic record generated by these types of tips will also facilitate inspections by the Workplace Relations Commission (WRC), in the event of a complaint being made.

A spokesperson for the Restaurants Association of Ireland said: “The Restaurants Association of Ireland welcome the Government’s decision to bring forward legislation regarding tips and look forward to working with the Tánaiste’s department in making the tips legislation as workable as possible for employees and business owners.”

This new law builds on the suite of legal rights that the Government is introducing to protect workers, which includes the Sick Leave Bill, the Transparent and Predictable Working Conditions Directive and the right to request remote work.

This proposal had been commenced in 2019 but had fallen following the general election of February 2020.

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