Fairer tipping law for restaurants

Employers will be prevented from using tips to boost staff pay to the minimum wage under new Government plans.

The changes will ban restaurants from paying less than the minimum wage, currently £5.52 per hour, and making up the difference through tips and service charges.

Unions welcomed the changes, which will prevent employers using the existing loopholes in minimum wage legislation. They are planned for introduction next year, coinciding with the 10th anniversary of the law.

TUC general secretary Brendan Barber said: "Most ordinary people think the current loophole in the law is unfair because it allows unscrupulous employers to cheat workers out of the tips that are meant for them.

"This is a welcome example of the Government responding to the concerns of hard-pressed vulnerable workers."

However, although business secretary John Hutton has encouraged employers to make it clear how tips are distributed so customers know where their money is going, the Government's announcement did not suggest that they would be forced to do so.

Mr Hutton said: "When people leave a tip, in a restaurant or elsewhere, they expect it to go to service staff and as consumers, we've got a right to know if that actually happens.

"This is an issue of fairness and common sense and it's one many people clearly care a lot about."

The minimum wage will increase to £5.73 on 1 October.