Employment (Allocation of Tips) Bill — House of Commons, 2022-07-15
Topic: Labor
Jane Marion Hunt (Conservative, Centre-right): I thank the hon. Gentleman for his question, and I can tell him that, yes, that is absolutely the case I will now talk about the proposed code. A voluntary code of practice on this topic was published in 2009. Our evidence shows that voluntary guidance alone has not been enough to stamp out bad practice. This Bill will therefore require employers to have regard to a statutory code of practice. The code will continue to be developed in partnership with key stakeholders, and will be subject to a full consultation period before the final version is brought to the House for approval. The code will outline a fair and transparent allocation of tips, as set out in different example scenarios. It is very important that the code continues to be developed with stakeholder input, so that we do not inadvertently disallow certain arrangements that are considered fair in some workplaces for the benefit of both businesses and workers. It is important that the code can be updated in the future with the approval of Parliament but without any primary legislation, in order to keep up with changing practices I will now address some of the specific points made by colleagues in the debate. I thank my hon. Friend the Member for Watford again for all he has done. He raised a matter where I almost have to declare an interest, in that my husband interrogates the waiters whenever we go out to make sure that they are going to get the tip—it is surprising how many say that they will not get it. My hon. Friend the Member for Kensington (Felicity Buchan) clearly showed a good understanding of her local businesses and her constituency. She talked about burgers, and I quite agree that it is the service we pay for in the tip, not the burger itself. As she said, each establishment will create its own fair system available to everyone working there, so that the kitchen staff and cleaners can be included. They can decide what they want to do and that will then be followed. She also referred to consumers, and the Bill is fair to them as well. They are within my brief too, so I would like to be fair to them. I commend her for what she did while working in the Department for Business, Energy and Industrial Strategy until recently My hon. Friend the Member for Broxtowe (Darren Henry) talked about his experience and examples from restaurants in Broxtowe, and I can speak from experience when I say that the restaurants there are very good indeed. My hon. Friend the Member for Hartlepool (Jill Mortimer) talked about the great variety of restaurants on the Hartlepool riviera, which provide such great service to the people of Hartlepool—again, she is to be commended. My hon. Friend the Member for Charnwood (Edward Argar) talked about statutory protections that are currently lacking in the system and about rewarding the service given. He referred to the need to be timely and fair, and the word "fair" comes through again and again in this Bill. He is absolutely spot on I thank my hon. Friend the Member for Meriden (Saqib Bhatti) for his kind words and I thoroughly enjoyed working with him on the all-party group for small and micro businesses. He talked about a shortage of workers because of the pandemic, and indeed previous to that. I hope that this Bill will attract workers to the sector and help it to become one where people can form a career and get on in life. I am happy to meet him to discuss the hospitality sector, as he requested The shadow Minister, the hon. Member for Bristol East (Kerry McCarthy), referred to her surprise about some of the well-known businesses that have been taking tips. I absolutely agreed with her on that, as I was surprised as well. Conservatives always support hard work, and I think that is the vein in which we have been talking more than anything else The hon. Member for West Ham (Ms Brown), and my hon. Friends the Members for Watford, for Cheadle (Mary Robinson) and for Meriden raised concerns about employers using tips to top up low-paid workers. The law is clear: tips, gratuities and service charges cannot count towards the minimum wage. The Bill does not alter that position, and under these proposals employers cannot use tips to make up national minimum wage pay. My hon. Friend the Member for Meriden rightly said that we need more workers to get the pay and tips they have earned, to help promote employment in the sector, as I mentioned. Actually, there is no need to wait for this Bill to be passed; the sector should put its plans in place well in advance My hon. Friend the Member for Watford referred to deductions from tips for card payments and admin fees. To be clear, under this policy, employers must pass on all tips to workers without any deductions, other than those required or permitted by existing legislation—for example, normal tax rules will apply. They cannot make any deductions to cover the costs of running a business, including the cost of processing card transactions or other administrative costs My hon. Friends the Members for Watford and for Meriden referred to clarity around the code of practice. As I mentioned, the statutory code of practice will be published and consulted on before being laid before both Houses of Parliament for approval. The code will be developed through consultation in partnership with stakeholders. We hope to start informal discussions on the draft code later this year. There will be more formal consultation on a draft after the Bill has received Royal Assent. The code will provide details on when the Bill applies, how many employers should distribute tips fairly, tronc arrangements, employers’ tipping policies and record keeping. It will also include illustrative scenarios, such as sharing out tips between front of house staff and kitchen staff In conclusion, bringing forward these new rules will protect more than 2 million workers from bosses who do not currently do the right thing, and give them an avenue for seeking remedies. Businesses will be assured that they are not being undercut by companies where bosses are keeping tips for themselves, and consumers will have increased confidence that their tips are going to the workers they intended them for. The new rules are backed by previous Government evidence and analysis. The Government are therefore pleased to support this private Member’s Bill.