Damien English (Meath West, Fine Gael) | Oireachtas source

The new section 4B contained in the Payment of Wages (Tips and Gratuities) Bill 2022 requires employers to distribute fairly and in a transparent manner tips that are received in electronic form, that is, through debit or credit cards. It also provides that employers may not retain any share of tips or gratuities received by the employer electronically, unless such retention is required or permitted by law.

Employers who regularly do the same kind of work as their employees may also retain a fair and reasonable share of electronic tips, proportionate to their work. This is the policy already set out in the Bill, but this amendment better clarifies that intent. I hope it is clear to everybody what we are trying to achieve there.

Section 4B(1) is broadly in line with section 5 of the Payment of Wages Act 1991. There is no offence provision under section 5 and therefore there should also be also no offence provision in respect of section 4B(1). This is a technical amendment, but I can assure Senators that it does not prevent appropriate enforcement action by the WRC.

An amendment is required to section 4C(b) to clarify, by reference to section 4B, that the prohibition on an employer making a deduction only applies to employees’ electronic tips. The only deductions from electronic tips that will be permitted by section 4C(b) will be those required by law or the fair or reasonable costs associated with processing payment of tips or gratuities made by electronic means. I think that is fair and accepted.

While employers will be required to include detail on how cash tips are dealt with when displaying their policy towards tips and gratuities, there will be no other regulation of cash tips. The Workplace Relations Commission advises that this would be unenforceable due to the lack of an evidential trail in respect of cash tips. The WRC has to be able to do its job to enforce this. There has to be legislation that has enforcement as well.

Senators Higgins and Black have jointly proposed amendments that would require mandatory service charges to be treated exactly the same way as tips and gratuities. Senator Gavan proposed amendments also intended to achieve this. The Government amendments are a safer and surer way of achieving this aim. I hope that is accepted in good faith. The reason for this is that the definition of “mandatory service charge”, or “mandatory charge”, as we will now call it, was deliberately very broad. When the policy was that there would be no change at all in relation to mandatory charges, this was to support the transparency aims of the Bill. It made sure that the notices required under the Bill would have to explain the purposes of each of those charges and that is still the case. However, if we require the distribution of all charges, we will need to consider whether that definition is fit for purpose. It will cover items such as function charges for weddings or similar events where extra staff are required to provide an adequate level of service or cover charges where a band is also playing. The Government amendments are sufficient to address the reasonable expectations of customers and staff and are not unduly onerous for employers. I would ask that the Senators accept our amendments and not press their own, because I think we are achieving the same thing. However, I will hear the Senators’ views on that. At this stage, perhaps I will hear the Senators' comments and then come back in on the rest.