Labour Research November 2004

Law Queries

Tips on credit cards

Q: Is there any law relating to receiving tips on credit cards? I heard that there was a European court ruling on the issue.

A: I think you are referring to the European Court of Human Rights (ECHR) decision of Nerva & Others v UK [2002] IRLR 815.

A previous case had decided that tips left on credit cards can be paid as additional wages and are therefore subject to tax and NI deductions. The issue in Nerva was whether these tips could be counted as part of the minimum wage - and the ECHR decided that they could.