The Ministry of Immigration and Border Services is pleased to announce the implementation of a new Service Charge Formula for organisations that collect service charge within their establishments across the Turks and Caicos Islands under the Service Charge Act. The new formula is design to ensure fair and equitable distribution of service charge and to strengthen the Act for effective compliance. The new formula is effective 1st October 2025.
Total service charge collected to be distributed as follows:
- Each employee must receive a share of the total service charge collected, calculated by dividing the total amount collected by the total hours worked by all employees, then multiplying that result by the number of hours worked by the individual employee. (See example below).
- Employees on fixed/set salaries will be paid no more than 44 hours per workweek in their calculation of payable service charge. Example Senior Supervisors, Middle Managers, and above. Distribution Example:Establishment A have collected $100 for the MonthEmployee 1 worked 25 HoursEmployee 2 worked 35 HoursEmployee 3 worked 40 HoursService Charge Payable to each employee:Employee 1 – $100 X (25 hours/ (25+35+40) hours) = $25Employee 2 – $100 X (35 hours/ (25+35+40) hours) = $35Employee 3 – $100 X (40 hours/ (25+35+40) hours) = $40
New features to accompany the new formula are:
- Audit of Service Charge by TCIG.
- The requirement that the troncmaster provision has been implemented and the need to ensure that the role is being carried out.
- Resorts and businesses are to share their Service Charge Reports with the Employment Services Department/ Commissioner of Labour.
In supporting the release of the Service Charge Formula, Deputy Premier and Minister of Immigration and Border services with responsibilities for Regional, ECLAC and CARICOM Affairs, the Honourable Jamell Robinson shared:
“The release of the service charge formula marks a significant step forward in ensuring fairness, transparency, and accountability in how service charges are distributed among workers. This formula reflects our commitment to protecting the rights of employees while supporting sustainable practices within the hospitality and service sectors.
It is the result of extensive consultation with workers, employers, and industry stakeholders, and we believe it strikes a fair balance for all parties. With this formula in place, we aim to create a more predictable and equitable environment, where workers are justly compensated for their contributions and businesses are guided by clear, consistent standards.”
The industry is asked to take note of Section 14(2) of the Turks and Caicos Hotel and Restaurant Service Charge Act which refers to offences under this ACT.
