On Sunday (30 August) Business Secretary Sajid Javid announced he had ordered a formal call for evidence on the issue following a number of recent media reports which unveiled how some restaurant chains withhold a proportion of tips left for staff to cover administration costs.
He said: "When a diner leaves a tip, they rightly expect it to go to staff. In full. I’m concerned about recent reports, suggesting some restaurants pocket tips for themselves. That’s just not right.
"I’ve ordered an immediate investigation to look at the evidence and consider the views of employees, customers and the industry to see how we can deal with the abuse of tipping.
"As a one nation government we want a fair deal on pay for working people and that includes taking action on tipping abuse."
Javid said evidence would look at whether Government intervention was needed to strengthen the voluntary code of practice, launched in 2009 and overseen by the British Hospitality Association (BHA).
He said the Government was keen to gather views from across the industry and other 'key stakeholders'. Once the consultation closes on 10 November, it would then consider whether there should be a cap on the proportion of tips restaurants can withhold from staff for administrative costs.
BHA chief executive Ufi Ibrahim said the organisation 'would welcome dialogue with the business secretary on the matter of tipping and the industry code of conduct'
Restaurant operators and other interested parties wishing to give their views can do so online or in writing. Details are on the Department for Business, Innovation and Skills' website.
Today (1 September) Javid also announced 'a package of measures to ensure hardworking people receive the pay they are entitled to'.
The packages for fair pay include doubling penalties for firms failing to pay the National Minimum Wage and the new National Living Wage and taking forward criminal prosecutions for those who deliberately do not comply.
He said: "There is no excuse for employers flouting minimum wage rules and these announcements will ensure those who do try and cheat staff out of pay will feel the full force of the law."