'Best Practice' on Service Charges, Tips, Gratuities and Cover Charges

It is not for us to comment on all the current press coverage on operator’s disparate policies on tips, service charges and the like.

One thing is clear - and this is that service charges, tips, gratuities and cover charges cannot be used to make up national minimum wage pay.  This means that all eligible workers must receive at least national minimum wage in base pay with any tips they receive being paid on top.

However the publicity has alerted us to the Code of Best Practice on Service Charges, Tips, Gratuities and Cover Charges, introduced in 2009, in part with the support of the British Hospitality Association (along with others).

The Code aims to provide businesses with practical guidance on how to operate in a fair and transparent way and should ensure consumers have sufficient information to make an informed choice before they leave a tip or gratuity or pay a service charge. The Code applies to all tipping sectors including:

• hotels and restaurants
• gambling and betting outlets
• hairdressing and other beauty therapy businesses
• taxi operations

It can be found here: 'A Code of Best Practice on Service Charges, Tips, Gratuities and Cover Charges'.

Additionally the Department for Business Innovation and Skills has just begun a well-publicised call for evidence on tips, gratuities, cover and service charges. The call for evidence in part seeks views on the Government’s role in ensuring greater transparency around tipping and is to gather information on how tips, gratuities, cover and service charges are collected and on current practice as to whether and how much employers deduct from their employees.   Responses are requested by 10 November.

See: 'Tips, Gratuities, Cover and Service Charges: Call for Evidence'.