Amendments To Prevent Employers Retaining Tips

The proposed amendments to the Employment Act “will ensure that the practice of employers retaining tips and other gratuities earn by employees is discontinued,” Minister of Economy and Labour Jason Hayward said.

Speaking in the House of Assembly on Friday [Sept 22] the Minister said, ”I will be laying before this Honourable House a Bill entitled, Employment [Protection of Employee Tips and Other Gratuities] Amendment Act 2023.

“Currently there is no provision under the Act for the protection of tips and other gratuities in the workplace. As a result, there is no recourse for employees who do not receive the full amount of tips and other gratuities owed to them, reflective of the services they provide.

“The Ministry has been made aware of establishments that permit employers who do not participate in the provision of services to share in the distribution of tips and other gratuities.

“It has been an ongoing concern regarding instances reported where employers take from a tipping pool and other gratuities and put money that should be going to their employees, into the employer’s business. As a result, workers’ tips and gratuities are being reduced when they are made to share with others who should not be a part of the distribution.

The Minister’s full statement follows below:

Mr Speaker and Honourable Members,

Later today, I will be laying before this Honourable House a Bill entitled, Employment [Protection of Employee Tips and Other Gratuities] Amendment Act 2023.

Mr Speaker, The Government continues to progress legislative amendments that strengthen the rights of workers within the workplace. The proposed amendments to the Employment Act aim to provide protections to employees who receive tips and other gratuities. The amendments will ensure that the practice of employers retaining tips and other gratuities earn by employees is discontinued.

Mr Speaker, the Employment Act 2000 [the Act] sets the minimum requirements for employment relationships within Bermuda. However, despite the recent amendments made to this Act, there remain areas within the legislation that are out of step when compared to examples in other jurisdictions and are not in keeping with the International Labour Organization’s standard for best practice.

Specifically, Mr Speaker, currently there is no provision under the Act for the protection of tips and other gratuities in the workplace. As a result, there is no recourse for employees who do not receive the full amount of tips and other gratuities owed to them, reflective of the services they provide.

Mr Speaker, the Ministry has been made aware of establishments that permit employers who do not participate in the provision of services to share in the distribution of tips and other gratuities.

It has been an ongoing concern regarding instances reported where employers take from a tipping pool and other gratuities and put money that should be going to their employees, into the employer’s business. As a result, workers’ tips and gratuities are being reduced when they are made to share with others who should not be a part of the distribution.

Mr Speaker, when drafting the amendments in relation to these concerns, the views of the Department of Labour, who receives and addresses these complaints, and the Labour Advisory Council, a cross section of employer and employee representatives, were sought and considered.

Mr Speaker, the amendments include provisions which seek to:

• Define tips and other gratuities;

• Protect against the withholding of tips and other gratuities by employers from employees;

• Establish measures to ensure employees are aware of their employer’s policy as it relates to tips and other gratuities; and

• Provide the necessary safeguards to ensure employees receive the tips or other gratuities owing to them, where provided.

Mr Speaker, these amendments, as they pertain to all employees who commonly receive tips or other gratuities or who work in an industry or sector where employees commonly receive tips or other gratuities, will ensure that there is a clear written policy statement providing for how tips and other gratuities are to be managed. The policy statement must be presented to each employee on the commencement of his employment and there shall be procedures to assist every employee in understanding the policy statement.

Mr Speaker, any employer who contravenes the Act in this regard will be liable to a civil penalty as may be imposed by the Department of Labour’s Manager or the Tribunal.

Mr Speaker, it is envisioned that this amendment will have a positive impact as it will ensure employees’ tips and other gratuities are managed appropriately and that employees have a clear understanding of how their tips and other gratuities are distributed.

Thank you, Mr Speaker.

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