Is the Government’s proposed tip legislation a good idea?

In this week’s blog, we’re looking for your opinions. Please join in the discussion on Facebook, Twitter and LinkedIn.

Following a string of revelations about some companies withholding tips from staff, or placing ‘taxes’ on those tips, the government have announced plans to introduce legislation that would see all tips passed on evenly to staff members.

Restaurants will be banned from taking any cut from tips. Some restaurant chains, who will remain unnamed in this blog, had previously been accused of taking up to 40% of all tips. There has been anecdotal evidence that this was made easier by those chains who took gratuities via card payment.

The news of the legislation has been met with widely differing opinions.

On the one hand, the move is seen as positive. In fact, restaurant trade union bosses have been fighting for the legislation for years. They believed that it is the restaurant workers who have earned the tip and are therefore entitled to keep 100% of it.

However, other commentators have thrown doubt on certain aspects of the changes.

Non-customer facing staff may lose out in the shake-up, as they don’t have the ability to earn their own tips, despite being a large part of customer experience.

There has also been a question asked about how restaurants will take the hit of the loss of earnings. Will this result in smaller wages for staff in the future? Or will they stop encouraging customers to leave tips via card machine questions or optional service charges on receipts?

There could be an argument to say that if the restaurant are delivering constant training to staff members, than part of the employees positive performance is down to the restaurant.

On the face of it, the proposed new legislation will make things fairer for those who serve customers, but what impact will it have on the industry as a whole?

We’d love to know your thoughts on this contentious issue. Let us know your views in the comments section, or by commenting on Facebook, Twitter or LinkedIn.