Laws to ban employers from using tips or service charges to pay their workers are being drawn up by the Government.
The new legislation will also force hotels, restaurants and other companies to make their policy clear to customers as to how tips are distributed to employees.
It follows reports that a number of high-profile businesses do not pass on all the tips received by staff during shifts and instead put it towards breakages, staff parties or even the salaries of casual contract workers.
The Government was criticised for opposing a Sinn Féin bill to end the practice of ‘tip theft’, with the Fórsa union calling the Government’s action “shameful”.
Speaking at the biennial conference of the Irish Congress of Trade Unions (Ictu) last week, Fórsa lead organiser Grace Williams said: “When we give a tip to a waitress or waiter, it’s because we want to reward them for the service they’ve given, not because we want to boost the profits of their bosses.”
She called on the Government to act, claiming their blocking of the opposition Bill was “shameful and totally out of step with the public mood”.
However, Minister for Employment Affairs and Social Protection Regina Doherty has now received Government approval on a draft Heads of a Bill which will regulate practices around tips and gratuities.
The Bill will change the Payment of Wages Act to ensure that tips and gratuities cannot be used to ‘make-up’ or satisfy a person’s contractual wages.
It will also provide for a requirement for employers to clearly display, for the benefit of workers and customers, their policy on how tips, gratuities, and service charges are distributed.
Ms Doherty said: “It has become clear over the past number of months that in a minority of establishments, workers are not being treated fairly with regard to tips. As I said previously, I will not tolerate this on my watch and now, having received approval from Government, I look forward to introducing measures which will improve the situation and, crucially, have a sound legal basis.”
She said the new laws would follow on from the Employment Act 2018 which restricted zero-hour contracts and introduced banded hours contracts.
“I am determined to always stand up for fairness and the employment rights of low-paid and precarious workers,” she said.
The Department of Social Protection will now proceed with drafting the legislation. It is expected to commence pre-legislative scrutiny of the bill as soon as possible.