Almost every restaurant has a tip rule. Far fewer have it written down, and the difference between the two only shows up at the worst possible moment: a disputed payout, a resignation, a new manager who divides Saturday differently because nobody told them otherwise.

The fix is smaller than it sounds. Not a contract, not an appendix to the staff handbook — one page that answers six questions, dated, where people can see it.

Why the written version behaves differently

An unwritten rule is not a weaker version of a written one. It is a different thing, because it has no fixed content — it is whatever the person explaining it remembers, and that changes with who is asked.

Writing it down does three specific things. It fixes the content, so two people cannot both be right about what the rule is. It makes the rule reviewable, so it can be argued with in advance rather than during a payout. And it makes it inheritable, so the next person to close the till is applying the same rule rather than reconstructing one.

The six questions

1. What counts as a tip

The boundary case is the one that causes trouble, so name it explicitly. Cash left on the table, an amount added on a card terminal, a rounding-up, a service charge printed on the bill, a payment through an app — these do not all behave the same way, and in several countries they are not even the same thing legally.

Write which of them go into the pool and which do not. If a service charge is treated as revenue rather than as a tip, say so here, in one sentence, rather than letting people discover it from a payslip.

2. Who shares in it

List the roles, not the people. “Service, bar, runners and kitchen” ages well; a list of names needs editing every time someone is hired.

Then answer the two questions the list will immediately raise: what happens to a trial shift or an agency worker, and whether salaried supervisors are included. Both are things somebody will ask in the first month.

3. How it is divided

The method itself, with the numbers. Not “fairly, according to contribution” — that phrasing looks reasonable and settles nothing. If it is hours-weighted, say so and give the formula. If it is points, publish the point values in the policy, because a weighting that lives in someone’s spreadsheet is not a rule anyone can check.

4. When it is paid

Per shift in cash, weekly, or with the monthly payroll. Give the actual timing, and say what happens when it falls on a holiday.

This line looks administrative and prevents a surprising amount of friction, because “when do I get it” is the question people are actually asking when they ask how tips work.

5. Who does the arithmetic, and who checks it

Name the role that performs the calculation and the role that can verify it. The second half is the one usually left out, and it is what turns the policy from a description into something with an appeal route.

Add where the record lives — the app, the shared folder, the binder behind the pass — so checking does not require asking permission.

6. How the policy changes

State what triggers a review and who has to agree a change. Triggers work better than dates: a new role, a change in headcount, a menu change, a shift in how guests pay.

Naming this in the policy is what stops mid-argument renegotiation. When someone wants to reopen the point values after a bad Saturday, the answer is already written down, and it is a process rather than a refusal.

What makes it stick

  1. Draft it, then ask before it applies

    Circulate the draft and take comments before the first shift it governs. The same document introduced afterwards reads as an announcement, and the objections arrive at the first payout instead of during the draft.

  2. Date the version and keep the old ones

    "What was the rule in March" gets asked more often than anyone expects — after a resignation, during an audit, when someone queries an old payout. Only a dated file answers it.

  3. Put it where the shift is, not where the contracts are

    On the wall by the pass and in whatever the team already opens on a phone. A policy filed in an HR folder is technically available and practically invisible.

  4. Walk new staff through it in week one

    Ten minutes during onboarding, while somebody can still ask what a point is worth. It is also the moment to hand over the worked example, which is what people actually remember.

In the United Kingdom this stopped being optional. Under the Employment (Allocation of Tips) Act 2023, an employer at whose place of business tips are paid on more than an occasional and exceptional basis must have a written tipping policy and make it available to all workers[1]. The statutory code of practice sets out what the policy should cover — how tips are accepted, how they are allocated and distributed, and the steps taken to handle them fairly and transparently[2].

The record-keeping duty is the part that catches people out. Employers must record every qualifying tip and its allocation, and keep that record for three years from the date the tip was paid. Workers can request it — once per three-month period, covering up to three years back[1].

The Employment Rights Act 2025 adds consultation and review on top: consulting worker or union representatives before the first version of the policy, reviewing it at least every three years with consultation each time, and making an anonymised summary of the consultation available to everyone at that place of business[3]. Those provisions commence by regulation rather than automatically, so check the current commencement position before relying on a particular date.

Three ways a policy fails

It is too long to be read. Four pages of careful drafting produces a document nobody consults, which leaves you with a habit and a false sense of coverage. Cut to a page. If the rule will not fit, simplify the rule.

It describes an intention rather than a procedure. “Tips are shared fairly among the team in recognition of everyone’s contribution” survives every review and answers no question anyone has. If a sentence cannot produce a number, it is decoration.

It is never updated. A policy that still describes a two-person kitchen and mostly-cash payment is worse than none, because people stop trusting the parts that are still accurate. This is what the review trigger in question six is for.

The version that gets used

Aim for something that would not impress a lawyer: one laminated sheet by the pass, six short sections, a worked example from an ordinary Friday, a date in the corner.

A document like that is argued over exactly once, by the people it applies to, and then settles every payout after that. Which is the entire job.

Frequently asked questions

What should a tip policy include?

Six things: what counts as a tip, who is included in the distribution, how it is divided, when it is paid out, who performs and checks the calculation, and how the policy itself gets changed. If those six are answered in plain language on one page, the policy is doing its job. Anything beyond them is usually there to protect the author rather than to inform the reader.

Is a written tip policy a legal requirement?

In the United Kingdom, yes. Employers where tips are paid on more than an occasional and exceptional basis must have a written tipping policy, available to all workers, and must keep a record of tips and their allocation for three years. In Germany, Austria and most of Europe there is no equivalent duty, but a written rule is still what a tax authority asks for first when it looks at a pooled arrangement.

How long should a tip policy be?

One page. A policy is read once during onboarding and then consulted in the thirty seconds before a shift starts, and neither of those is a situation where four pages get read. If the rule genuinely needs more room than a page, that is usually a sign the split method is too complicated rather than that the document is too short.

How often should a tip policy be reviewed?

Set a review trigger rather than a calendar date: a new role, a change in headcount, a menu change or a shift in how guests pay. Those are the events that make a rule stop fitting. UK employers additionally have a statutory review obligation under the 2025 reforms, which run on a three-year cycle and require consultation each time.

Who should agree the tip policy?

Everyone it applies to, before it takes effect. A rule the team helped set survives a bad night; a rule announced on a noticeboard gets relitigated at the first payout somebody dislikes. Where a works council or union representation exists, involving them is not only good practice but may be a formal requirement.