UK Salon Tipping Laws Explained: Your Essential Guide

From today 1st October the Hair and Beauty industry, along with others, is finally seeing new tipping rules for fair distribution of tips to employees.

The Hair and Beauty industry has leant on tipping to boost wages for a lifetime, this law will now ensure employers are not taking a cut from tips to increase revenue.

What does this actually look like and what does it mean?

Fair distribution of Tips

Employers are legally required to pass on 100% of tips to their employees. This includes tips given by all payment methods, cash, card or any other payment means. Employees are not able to deduct a percentage of the tips for fees or for revenue gain.

No Employer control over tip distribution

Tips must be fairly distributed to all eligible employees, the employer must not keep any amount of the tip regardless of the tip amount.

Written tip policy

Hair and Beauty salons are required to have a written tips policy that outlines to the customer how tips are collected, distributed and shared. All employees must be aware and have access to this policy.

Interested to discover how SalonIQ can help you enhance your salon? Connect with us

Transparency in record-keeping

As a salon owner you must keep a detailed record of all tips received and how they are distributed for a minimum of 3 years.

If an employee wants to know how a tip was handled they have the right to request this information from their employer and for them to get back to them with the required information within a reasonable time frame.

Employees right to claim unfair tip distribution

If the employee believes the tips have not been distributed fairly, they can raise a claim with the employment tribunal.

Employees can then claim back tips from their employer that they were entitled to.

Penalties for non-compliance

Salon owners who fail to comply with the new tipping laws could face penalties or compensation claims from their employees.

This new legislation is part of the UK government’s effort to ensure a fairer workplace environment for those in hospitality and service-based industries.

Interested to discover how SalonIQ can help you enhance your salon? Connect with us

Helpful Links:

• Code of Practice: Distributing tips fairly: statutory code of practice – GOV.UK – https://www.gov.uk/government/publications/distributing-tips-fairly-statutory-code-of-practice
• Non-Statutory Guidance: Distributing tips fairly: non-statutory guidance for employers – GOV.UK – https://www.gov.uk/government/publications/distributing-tips-fairly-non-statutory-guidance-for-employers
• The Code of Practice is statutory and has legal effect. This means that it can be introduced as evidence in the Employment Tribunal.
• These new measures will apply to all sectors in England, Scotland and Wales. Employment policy is devolved to Northern Ireland.