New Tipping Legislation Offers Clarity for Hospitality Workers

Image Credit: Tourism Australia

The Payment of Wages (Amendment) (Tips and Gratuities) Act 2022 has been welcomed by trade unions, hospitality workers, and has widely been well-received.

The legislation, which is set to take effect from December 1st onwards, has clarified the legal status of tips and gratuities left by customers for workers in the service industry and hospitality sector.

Michelle (22), a waitress working in a bar-restaurant in Dublin City Centre, sat down to offer her perspective on the recent legislation: “I think it’s a positive development because, when customers tip the staff in work, they’re expecting it to go to their servers and not the management, or to anyone else really. You know, they’re tipping because they got good service, and because they want to show their appreciation.”

“Also, it makes a big difference to service staff, because most of them are on minimum wage. It’s really extra money for us.” Michelle discussed how tips and gratuities provide service workers with disposable income, helping to supplement their low wages. However, when asked about the reliance on tips that many service workers experience, Michelle argued: “I think [wages] definitely should be higher, because it’s not easy work that we do.”

She proceeded to explain: “We’re on our feet all day, and a lot of the time, especially in busy restaurants, they’re making so much money. The business is making so much in profit that they should be able to treat their workers better, especially with all the rising costs in Dublin. I think it does show that we’re not really paid enough for what we do.”

The new legislation has been called for by many trade unionists, concerned by reports of earnings frequently lost by service workers to tip theft. Karen Doyle, Secretary of Unite the Union’s Hospitality branch, said in a meeting with the Department of Enterprise, Trade, and Employment earlier this year: “Customers assume that service charges are just that: payments in recognition of the service provided by servers. The forthcoming legislation must therefore ensure that any charges labeled ‘service charges’ are distributed solely to the workers providing the service.”

Julia Marciniak, Hospitality and Tourism Coordinator of Unite, went on to argue: “By amending the legislation to clarify that service charges must be distributed solely to workers, the Government has an opportunity not only to raise the living standards of low-paid hospitality workers, but also to boost consumer confidence in the sector.” The union’s calls for this amendment appear to have been successful, as the legislation stipulates that service charges must be distributed to workers.

A press release from the Department of Enterprise, Trade, and Employment characterised the new legislation as a step towards greater clarity and equity in the distribution of tips. It stated that the new legislation would ensure: “legal rights (for employees) over the payment of tips, more clarity for customers, new requirements on employers to clearly display their policy on tips and service charges (and), any charge called a ‘service charge’ will have to be distributed to staff as if it were a tip or gratuity received by electronic means.”

Earlier this year, reported that Sinn Féin Senator Paul Gavan praised the trade union campaign that successfully campaigned for legislative reform of hospitality tipping practices. He said: “While this Bill isn’t perfect, it goes a long way to dealing with the issue of tip theft which has been costing employees hundreds of euros each year.”

The new legislation is the product of months of campaigning by trade unions, political parties, and activist groups on behalf of workers in the hospitality sector and service industry. While the legislation is expected to offer some degree of clarity for workers and customers alike, criticisms remain regarding the low wages paid to such workers, and the extent to which they rely on tips in order to supplement their income. Many students who work part-time throughout the academic year are expected to benefit from this popular legislative change. Although the legislation requires that service charges must be distributed to workers, just how strictly it will be enforced remains to be seen. 

Student-workers who would like to share their experiences of working in this sector, and help keep our readers up to date on the implementation of this legislation, are asked to email: