Regina Doherty ‘will not tolerate’ unfair treatment of workers over tips

Minister for Employment Affairs and Social Protection Regina Doherty has said she will not stand for workers being treated unfairly on her watch in relation to tips provided by customers.

The Minister said on Sunday that new legislation aimed at regulating practices around tips and gratuities would seek to prevent employers from using these to make up staff wages.

Ms Doherty said she had received approval from Cabinet last week to draft the new legislation on tips.

“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,” Ms Doherty said.

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Amend

The Minister said that under the new legislation she intended to amend the existing Payment of Wages Act to ensure that tips and gratuities could not be used to “make up” or satisfy a person’s contractual wages.

She said the legislation would provide “for a requirement on employers to clearly display, for the benefit of workers and customers, their policy on how tips, gratuities and service charges are distributed”.

Informed sources said while under the new measures employers would have to publicise their policy on the distribution of tips and gratuities, the Government would not seek to set out what such policies should be.

“I am determined to always stand up for fairness and the employment rights of low-paid and precarious workers. I made significant progress in this regard with the Employment Act 2018 which restricted zero hours contracts and introduced banded hours contracts.”

The Low Pay Commission advised the Government that new legislation to ensure that workers receive tips or gratuities paid by customers were not needed

The Government had opposed an earlier Sinn Féin Bill which aimed to stop employers using tips or service charges to make up contracted wages.

Not needed

In February the Low Pay Commission advised the Government that new legislation or regulations to ensure that workers receive tips or gratuities paid by customers were not needed.

The commission said it did not believe that sufficient reliable data existed to prove that the issue of employers withholding employee tips was a significant problem in Ireland.

The commission said it did not believe that legislation or regulation should be introduced in this area, as the administrative and compliance costs involved would not be justified.

“The commission is also concerned that there could be unintended negative consequences such as the reclassification of service charges, leading to a potential reduction in the take-home pay of low-paid employees,” it said.

Government sources said at the weekend that the commission had advised against introducing “heavy regulation or primary legislation on the issue”.