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2 rules about tip pooling

| Sep 9, 2019 | Employment Law |

Tip pooling is something that not all tipped employees support, but it is legal. It generally just means that some or all of the tips get combined and split up evenly.

For instance, if there were three servers at a restaurant and two cooks, and two of the servers earned $100 in tips while the third made $50, the restaurant could pool all $150 and give each of the five employees $30.

Why do this? For one thing, it helps the nontipped employees, like the cooks, get paid extra. For another, it gives the employees a team mentality where they support the business, not just their own efforts.

In any case, there are some legal stipulations. First off, the employees need to know that a tip pool is being used. If the employee thought they made $100 and was then told they only made $30, they would not be pleased.

Second, the rules about minimum wage still apply. With tips and their pay from the establishment, all of the employees involved in the tip pool still need to make the legal minimum wage. If the pooling would put them under, this may mean that the employer has to pay out more. These cases may be rare, but it’s critical for everyone to know the minimum they should still make for every single hour they spend on the job.

Employment law, especially when considering wages, can be a very contentious area that people feel strongly about and take quite seriously. It’s important for all those involved in a dispute to know their legal rights.