Requirement to deal with tips, gratuities and service charges Section 5: Agency workers
This section inserts section 27H, which provides for agency workers, who might not be workers of the principal (or hirer) to which they are supplied, to benefit from the Act as if they were a worker of the principal. Subsection (1) explains that an "eligible agency worker" is an individual who is: supplied by "the agent" (e.g. an employment agency) to do work for "the principal" (the hirer – e.g. an employer of workers at a restaurant) under a contract between the agent and the principal; not a worker of the principal (because of the absence of a worker’s contract between the worker and the principal); and not carrying on their own business for clients or customers.
	Subsection (2) provides that where such an eligible agency worker does work for the principal at a place of business, the Act applies as if that agency worker were a worker of the principal. In effect, this requires the principal to fairly allocate the tips, gratuities and service charges between the agency workers and the workers which it directly employs.
	Subsection (3) allows a principal to pay qualifying tips, gratuities and service charges to "the agent" (who may be the employer of the eligible agency worker), rather than making payments directly to the agency worker (who may not be on their payroll). This must be no later than the end of the month following the month in which they were paid by a customer. This mirrors the timings in new section 27G. Under subsection (4), the agent is required to pay the amount received from the principal to the agency worker before the end of the month after the month in which the agent is paid by the principal. The agent must not make any deductions from the amount payable under section 27D(2), other than statutory deductions such as tax. Subsection (6) explains that the provisions relating to agency workers also extend to former agency workers.