Official Industry Body To Oversee Best Practice For ‘Tipping’ And ‘Service Charges’ In Hospitality Sector

Money-EP Business in Hospitality, in partnership with WMT Troncmaster Services, has today announced the official board for a new industry body, created to monitor and accredit best practice for tipping and service charges across the hospitality industry.

The need for a valid, industry-recognised accreditation scheme and associated Kitemark, that provides greater clarity on tipping and ‘vague’ service charges, is becoming ever more relevant. Independent research conducted by EP (carried out back in January 2019*) revealed a high level of customer scepticism and confusion around what happens to the non-cash tips and services charges that are added onto many restaurant and foodservice bills.

To date there has been no real clarity on who should receive a share of the tips and service charges paid by customers, leaving it wide open to interpretation and exploitation.  Yet 44% of hospitality firms surveyed said they would support and welcome the introduction of an accreditation scheme for businesses to ensure gratuities are distributed fairly to staff.

Chris Sheppardson, CEO at EP Business in Hospitality, who is leading the campaign alongside WMT, said: “We are delighted to announce the official industry body to oversee best practice guidelines for tipping and service charges. Our board is made up of a great number of industry leading professionals, all with a wealth of knowledge in the sector and a deep understanding of the issues at stake.  We are looking forward to taking this forward and to working together to demystify much of the confusion surrounding gratuities.”

Peter Davies, Client Service Partner and Managing Director of WMT Troncmaster Services added: “The wording used by hospitality firms in relation to service charges has always been vague and people interpret this in different ways, which only exacerbates confusion.  The announcement of our official body is a positive step forward for the sector in terms of uniting the industry as a whole and working together to agree on what best practice looks like for the future.”

EP’s research found that the most common form of gratuity is cash tips (25%) followed by card payments (21%), discretionary service charges on some bills (19%) and a discretionary service charge on all bills (16%). In respect of the hospitality industry, separate research carried out by EP revealed that 33% of firms share more than 90% of tips and service charges with their staff while only 31% share 100% of the gratuities.