Tiproll / Tipping law checklist

The tipping law, as a checklist.

Everything an employer in England, Wales or Scotland has to do about tips, gratuities and service charges: what's required now, what's expected by the end of 2026 (not law yet), and what happens if it goes wrong. Checked against GOV.UK and legislation.gov.uk on 11 October 2026.

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Who this applies to: employers where the business receives tips, gratuities or service charges, or controls or significantly influences how they're shared. Passing tips on in full, sharing them fairly and paying them on time apply to every qualifying tip, however rarely tips come in; the written policy and records are needed where tips are paid more than occasionally. It covers card, cash, app and voucher tips. A cash tip a worker receives and keeps, with no involvement from the employer, is outside the sharing rules, but if tips at your venue all go straight to staff and they keep them, you still have to tell your workers that you don't need a written tipping policy, and why, and reply to any request for tipping records within four weeks to explain the same. The rules protect workers, including agency workers, but not the self-employed (such as salon chair renters). The tipping law covers employers in England, Wales and Scotland. Northern Ireland has its own employment law and these rules don't apply there.

Required now (since 1 October 2024)

Employment (Allocation of Tips) Act 2023, which inserted Part 2B into the Employment Rights Act 1996.

Pass on every penny

All qualifying tips, gratuities and service charges go to workers, with no deductions except the tax and National Insurance the law requires. That includes card tips, service charges and cash tips you collect or tell staff how to share, however rarely tips come in.

With Tiproll: Allocations always add up to the pot exactly: the maths can't keep a penny.

Share them fairly

Allocate using clear, objective factors and have regard to the statutory Code of Practice. Agency workers must be included on a fair basis. Tips are shared between the people working at the venue where they were paid: you can't pool tips across branches.

With Tiproll: Hours, points, equal or hybrid methods, applied the same way every period. Each venue has its own tip periods, so pots never mix.

Pay on time

Tips must reach workers by the end of the month after the month the customer paid them: tips left on 23 June must be paid by 31 July.

With Tiproll: A deadline on every period, with reminders before it's due.

Have a written policy

If tips are paid more than occasionally, you need a written tipping policy that says whether you ask customers to tip and how tips are shared. It must be available to every worker at the venue, including agency staff and anyone who doesn't share in tips.

With Tiproll: A plain-English policy generated from your answers: print it, download it as Word, or share a staff link.

Keep records for three years

Record all qualifying tips and how they were allocated to each worker, and keep the record for three years.

With Tiproll: Locked periods that can't be edited, with an audit log of every change.

Answer record requests within four weeks

A worker can make a written request (once every three months) for the record covering whole months they worked in the last three years. You must reply within four weeks, counting the day the request arrives.

With Tiproll: A request portal for each venue, a countdown, and one click to send the record.

Coming next: Employment Rights Act 2025

These changes aren't law yet. The government's timeline (25 September 2026) says “strengthening tipping law” will take effect by the end of 2026, and its consultation says late 2026 once Parliament approves the revised Code of Practice, but no start date has been set and dates may change. The revised Code was consulted on from 19 August to 29 September 2026; until it's approved, GOV.UK says to keep following the 2024 Code.

Consult your workers

Once in force, you'll have to consult before you write your first tipping policy and every time you review it: through recognised trade union or elected worker representatives for the workers affected where they exist, or directly with those workers where they don't.

With Tiproll: Anonymous one-time survey links and QR slips, plus a record of meetings and representatives.

Publish an anonymised summary

Make an anonymised summary of the views expressed available to all workers at the venue.

With Tiproll: A summary drafted from the results, with small groups merged so no one can be identified.

Review at least every three years

Review the written policy at least once every three years. The first review is due within three years of the day you first gave staff a policy, even if that was before the change, so a policy from October 2024 needs its first review by the end of September 2027. The Code also says to review it whenever your team or business changes.

With Tiproll: A review date worked out from your first policy and your last review, with reminders well before it falls due.

What the draft revised Code says about consulting

Consultation should be genuine and in good faith, with enough time, not a paper exercise. It's advisory: you don't have to adopt every suggestion.
Consult through recognised trade union or worker representatives where they exist; otherwise directly with the workers affected.
Surveys, group discussions and meetings are all fine, proportionate to the size of the business. Give people enough information to understand the proposal.
Seek views across all groups (not only the largest or the most vocal) and take reasonable steps to hear from people facing barriers such as language, disability or confidence.
A simple majority vote shouldn't be the default way of deciding.
Keep a written record of the process, the views and the outcome, and make an anonymised summary available to everyone at the venue.

If it goes wrong

A worker can complain to an employment tribunal if tips aren't allocated or paid fairly and on time, within 12 months of the failure.
For failures on or after 1 October 2026, complaints about a missing policy or records can be made within 6 months (it was 3 months).
A tribunal can order you to re-allocate the tips and pay what's owed (including to workers who didn't complain), and award compensation for financial loss of up to £5,366 per worker (the limit since 6 April 2026; it rises most Aprils).
A worker must normally contact Acas for early conciliation before making a claim, and the time that takes doesn't count towards the time limit.

Workers are encouraged to raise concerns with their employer first, and Acas early conciliation normally comes before any claim. A tribunal takes the Code of Practice into account, but failing to follow it isn't automatically proof that you've been unfair.

Good practice that helps

Use objective factors

Hours worked, role, seniority, basic pay or length of service can all be fair factors. Be careful with guaranteed fixed sums for particular roles: the Code warns they can be unfair.

Check for indirect discrimination

If one group gets less and that group has a disproportionate number of people with a protected characteristic, think again. Re-check as your team changes.

Explain it to everyone

Plain language, and an accessible format on request. Make sure agency staff can see the policy too, not just people at induction.

Mind the tax

Tips are taxable. National Insurance treatment depends on how they're shared: see HMRC's E24 guidance or ask your accountant.

Frequently asked

Does the tipping law apply to my business?

If your business receives tips, gratuities or service charges, or controls or significantly influences how they're shared, the Employment (Allocation of Tips) Act 2023 applies in England, Wales and Scotland. You must pass every qualifying tip on in full, share it fairly and pay it on time, however rarely tips come in. If tips are paid more than occasionally and exceptionally, you also need a written tipping policy and records. That covers most restaurants, pubs, cafés and hotels, and many salons, barbers and taxi firms. A cash tip handed to a worker who simply keeps it, with no involvement from you, is outside the sharing rules. If tips at your venue all go straight to staff and they keep them, you still have to tell your workers that you don't need a written tipping policy, and why, and reply to any request for tipping records within four weeks to explain the same. Northern Ireland has its own employment law and these rules don't apply there.

Can I deduct card processing fees from tips?

No. Since 1 October 2024 tips must be passed on in full. The only deductions allowed are the income tax (and National Insurance, where it applies) that the law requires.

What's changing with the Employment Rights Act 2025?

The Act adds a duty to consult workers before you write your first tipping policy and every time you review it, to make an anonymised summary of their views available to everyone at the venue, and to review the policy at least every three years. None of this is in force yet. It's expected by the end of 2026, once Parliament approves a revised Code of Practice (consulted on until 29 September 2026), but the government hasn't confirmed a date. Tiproll's consultation tools are built around the draft revised Code.

Is the staff consultation genuinely anonymous?

Yes. Each survey link works once. We store answers under a random key with no time stamp and no link to the link that was used, and you only see results once the consultation has closed and at least three people have answered. Role groups with fewer than three answers are merged so no one can be singled out.

Do you pay my staff?

No. You stay in control of the money. Tiproll works out each person's share to the penny, keeps the record and gives you a payroll file. You pay tips through your normal payroll or bank.

Will staff see each other's tips?

No. A staff statement shows the total tips for the period, how the share was worked out and that person's own amount, never anyone else's, exactly as the Code of Practice requires.

Which tills and EPOS systems work?

Any system that exports a CSV. We include templates shaped like Square, SumUp, Lightspeed, Zettle and Toast exports, and a column mapper that works with anything else, or you can type totals in by hand.

What happens to my records if I cancel?

They stay yours. You keep read-only access so you can view and download your records for the three years the law requires, and answer worker requests. Nothing is deleted unless you delete your account.

Is Tiproll legal advice?

No. Tiproll gives you software, templates and information based on the law and the statutory Code of Practice. For advice on your specific situation, talk to Acas (free) or an employment solicitor.

Sources

This page is general information to help you understand the rules, not legal advice. For advice on your situation, contact Acas or an employment solicitor.

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