A tipping policy template for UK restaurants: what to include, with example wording

Why you need one

Since 1 October 2024 any business where customers tip more than now and then must have a written tipping policy, and make it available to every worker (Employment (Allocation of Tips) Act 2023). The statutory code of practice says it should explain how tips are taken, how they are shared out and paid, and what you do to keep that fair and open. It must be in plain language, and you must offer an accessible format to a worker with a disability who asks. For the law behind each point, read our guide to tipping and tronc law.

Below, each heading is a section of the policy: what it has to say, then an example line or two in a box.

The outline

1. Who and where it covers

Name the business and each site the policy applies to. Say who shares in tips: employees, casual and zero-hours staff, and agency workers, who are covered by the Act like everyone else.

This policy covers tips received at [restaurant name], [address]. It applies to everyone who works here, including casual staff and workers supplied by an agency.

2. Which tips it covers

List each way money reaches you as a tip: tips on card, a service charge on the bill, tips in cash, and vouchers or tokens with a money value. Say plainly that a discretionary service charge is a tip and is passed on in full. For cash, say whether it goes into the shared pot (and is then covered) or stays with the person given it.

Card tips, our discretionary [12.5]% service charge and cash put in the tips jar are shared under this policy. Cash a guest hands to you personally is yours to keep.

3. What comes off

Only tax and National Insurance, where it is due. Say so, so nobody wonders about card fees or breakages.

Every tip is passed on in full. We take nothing for card fees, admin or breakages. The only deductions are income tax and, where it applies, National Insurance.

4. How tips are shared, and why

This is the heart of the policy. Name the method and the factors behind it. The code’s own examples of factors are the type of role (front of house and kitchen, say), basic pay, hours worked while the tips came in, individual or team performance, seniority, length of service and what the customer meant. Choose factors that are clear, objective and do not leave any group worse off because of a protected characteristic. Include a worked example: it answers most questions before they are asked.

Tips are pooled each week and shared by hours worked, with each hour counted by role: front of house 1.0, kitchen 1.0, supervisors 1.2. Example: a £1,000 week with 600 weighted hours pays £1.67 for each weighted hour.

5. Who runs it

Say whether the business shares the tips out or an independent troncmaster does, and name the troncmaster if there is one. This decides National Insurance: tips shared by a troncmaster who is not the employer, with the employer playing no part in the split, carry no employer’s or employee’s National Insurance; tips the employer shares out do (HMRC, E24).

Our tronc is run by [name, role], who is not a director or owner, and who decides the split under this policy. Tronc payments go through the troncmaster’s own PAYE scheme.

6. When and how tips are paid

Give the pay cycle and how tips show on the payslip. The legal limit is the end of the month after the month the customer paid; say you will meet it.

Tips for each week are paid with the following week’s wages, shown on your payslip as “Tronc”. They are always paid by the end of the month after the month they were received.

7. Holidays, leavers and new starters

People ask about these first, so settle them in writing. Decide whether tips follow hours worked only, what a leaver is owed for their last weeks, and when a new starter joins the pool. Apply the same rule to everyone.

Tips follow hours worked in the week. If you leave, you are paid your share for every week you worked, by the usual date.

8. The record, and how to ask for yours

Say that you keep a record of every tip received and each person’s share for three years. Explain how to ask for it: in writing, once in any three months, for up to three years back. The worker is given the total tips received and their own share, not other people’s (statutory code).

To see your tips record, email [address] or write to [name]. You can ask once every three months, for any period up to three years back while you worked here.

9. Questions and complaints

Name who to ask, and how a complaint is handled. Workers can also go to Acas, and to an employment tribunal.

Questions about tips go to [name]. If you are unhappy with the answer, use our grievance procedure. You can also contact Acas.

10. Consultation and review

Date the policy and give it a version. Say how staff were asked about it. The code already says employers should consult to seek broad agreement that sharing is fair. Once the Employment Rights Act 2025 duty starts, which as of October 2026 is expected “by the end of 2026” with no date set, you will have to consult before writing or changing the policy, share an anonymised summary of what staff said, and review the policy at least every three years (Peninsula; MCA).

Version 2, [date]. Before this version we asked every member of staff for their views from [date] to [date]; a summary is on the staff noticeboard. We will review this policy by [date three years on].

Getting it to everyone

The code leaves the method to you, but every worker must be able to see the policy on the same terms. A noticeboard works only if everyone can reach it, agency staff included. You can also hand it over with the contract or email it; the code suggests giving agency workers a copy at the start of their engagement, or having the agency pass it on.

Before you share it

• Every way tips arrive is listed, and service charge is called a tip.
• Nothing comes off but tax and National Insurance.
• The method, the factors and a worked example are there.
• It says who runs the tronc, and the National Insurance position matches.
• Payment is by the end of the following month at the latest.
• It says how to ask for the record.
• It is dated, and staff were asked before it was written.
• An employment adviser has read it.