On 31 July 2008 the Government announced a consultation on its
plans to amend the current National Minimum Wage legislation in
respect of tips, gratuities and service charges. The proposal was
that tips, gratuities and service charges would no longer count as
wages for the purposes of calculating whether a worker has been
paid the national minimum wage ('NMW'). The Government has
now confirmed that using tips to make up staff pay to minimum
national level will be outlawed. The change will come into effect
from 1 October 2009.
Current Position
At present, amounts paid by a customer as service charges, tips,
gratuities and cover charges count towards NMW pay, if they are
paid by the employer to the worker via the employer's payroll
and the amounts are shown on the pay slips issued by the employer.
However, they can not count towards the NMW where they are given
directly to the worker by a customer or are collected by a
troncmaster for example, the head waiter in a
