Drivers and workers must receive tips as new legislation may hit taxi operators and other sectors

The Business Secretary Greg Clark announced earlier this week a series of new measures to back businesses and entrepreneurs, support workers and ensure every part of the country benefits from the government’s modern Industrial Strategy.

One of the key changes that may affect the taxi and private hire industry centres around what happens to drivers tips left on third party booking apps or operators. As part of the shake up the government announced plans to ensure that tips left for workers will go to them in full. While the government says “most employers act in good faith”, in some sectors evidence points towards poor tipping practices, including excessive deductions being made from tips left by customers. New legislation, to be introduced at the earliest opportunity, will set out that tips must go to the workers providing the service.

Uber, the UK’s biggest minicab hailing platform, already works to the new legislation and doesn’t charge drivers a fee on tips collected

However, some operators and booking systems do take a percentage of the driver tips to arguably cover the cost of processing the added tip.