Employers not paying workers their tips in their entirety, without deductions, may soon become illegal.
A bill sponsored by the Conservative MP for Ynys Môn, Virginia Crosbie, would also introduce an obligation to allocate tips fairly among workers.
The UK government is backing the move and said it would benefit more than two million workers.
The trade union Unite said it would reserve judgement until "potential loopholes" in the bill were closed.
Kristian Cuffin, 30, who owns the Cuffed In Coffee cafe in Holyhead, in Ms Crosbie's constituency, said he could not imagine not already giving his staff the entirety of their tips.
"That's what they're intended for," he said.
All tips at Mr Cuffin's cafe are split evenly among staff each week, with electronic tips logged in a report at the end of each day.
"For us, I can imagine it's a lot easier because we all work fairly even hours. If somebody is working 40 hours and someone's only working five, then to distribute it evenly might not work.
"I suppose it depends on your business. But for us, it's quite a simple process," he added.
Ms Crosbie took over responsibility for the bill when Dean Russell, the backbench MP who introduced it, became a minister.
She acknowledged that most employers were already "doing the right thing," but said the bill would help "create a level playing field".
Under the law, employees would also be given the right to view their employer's tipping record.
"It means that when somebody is in a restaurant or they're in a beauty bar or a taxi, and they pay a tip on their credit card, that this tip will go to the person that actually served them or helped them," she said.
Currently, businesses who receive tips by card have the choice of whether to keep it or pass it on to workers. Cash tips, on the other hand, are legally the property of staff.
In 2021 the UK government said 80% of all tipping now happened by card and suggested this had made it easier for businesses to keep the funds.
Many of the jobs in the MP's constituency are in hospitality and tourism and she has been holding listening events with business owners and workers to help draw up a tipping code of conduct.
Rhys Taylor-Roberts, 20, who is one of six employees at Cuffed by Coffee, said he "100%" thinks the bill would be good news.
"It increases your wage, it gives you more motivation to have better customer service, it's appreciation that's being shown for your craft," he said.
"A few pounds does make a difference, it pays for the little things so that you can save for the big things. Whether it's dinner or you're going to get a new haircut. It's like a top-up, a little help," he added.
Unite has previously said it was "not confident" the measures would address poor practices.
Its hospitality spokesman Dave Turnbull said it has now secured a commitment that "potential loopholes" would be closed.
He added that the union would reserve its judgement until these changes "see the light of day".
The UK government first announced plans to ensure all tips go to workers in 2018, but these were never passed into law.
A UK government official said: "The Employment (Allocation of Tips) Bill, backed by the government, will ensure that all tips go to staff by making it unlawful to hold back service charges from employees."
"More than two million UK workers will benefit, helping ease pressures caused by increases in the cost of living."
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