Bill explainer: National Minimum Wage (Protection of Employee Tips) Bill

Better known as the Sinn Féin Tips Bill, the National Minimum Wage (Protection of Employee Tips) Bill seeks to make it illegal for employers to keep tips and give hospitality workers the legal right to the entirety of any gratuity received.

Introduced by Sinn Féin Senators Fintan Warfield, Paul Gavan and Trevor Ó Clochartaigh, the Bill, if passed, will require businesses to display their tipping policies to ensure that customers understand how their tips will be shared. After Senators voted 25 to 14 on an amendment, the Bill passed through the Seanad without a vote.

Despite calls from Gavan to push the Bill through the Dáil as quickly as possible, Minister for Employment Affairs, and Social Protection Regina Doherty TD placed a money message on the Bill, halting it after its second Dáil stage until whether or not it will cost exchequer funding can be determined. With a backlog of bills being examined under the money message mechanism and accusations that the Fine Gael minority government is using the mechanism to block Private Members’ Bills, it is not anticipated that the Bill will progress any time soon.

Minister Doherty had claimed that the Bill’s passage would mean that tips would be taxed under the PAYE system thus having knock-on negative effects on workers’ entitlements to social welfare supports, a contention that Gavan called “completely wrong”. Doherty claimed that “there are technicalities that would make it [the Bill] absolutely unworkable and unenforceable” and condemned the Bill for not differing between tips and service charges.

The Minister said that it would be easier to amend the Payment of Wages Act, and that the Low Pay Commission had “advised me strongly against introducing a heavily regulated regime in this area and advised me strongly not to introduce primary legislation”.

Bill highlights

The National Minimum Wage (Protection of Employee Tips) Bill 2017, in its most recent form — as passed through its second Dáil stage in June 2019 — states:

• “A payment voluntarily made to or left for an employee by a customer of the employee’s employer in such circumstances that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be kept by the employee or shared by the employee with other employees.”
• “An employer shall not withhold tips or other gratuities from an employee, make a deduction from an employee’s tips or other gratuities or cause the employee to return or give his or her tips or other gratuities to the employer unless authorised to do so… If an employer contravenes… the amount withheld, deducted, returned or given is a debt owing to the employee and is enforceable under this Act as if it were wages owing to the employee.”
• “An employer shall display on menus or in another suitable manner its policy regarding the distribution of tips to employees.”
• “An employer who withholds tips or other gratuities from an employee, makes a deduction from an employee’s tips or other gratuities or causes the employee to return or give his or her tips or other gratuities to the employer without lawful excuse shall be guilty of an offence.”