Is it legal for restaurants to force servers to pool tips?

October 29, 2024 On Behalf of Finn Law Offices In Employment Law

There are different rules that apply to servers who work in the restaurant industry than to most other employees. Specifically, they are subject to a lower hourly minimum wage. They receive less pay per hour because there is an expectation that customers patronizing the restaurant should provide a gratuity or tip.

Servers can capitalize on their people skills and professional experience to earn very competitive wages at restaurants. Most servers expect to take home whatever they receive from the customers they assist. Some servers have to share their tips with coworkers. Is that practice legal?

Tip pooling can constitute wage theft

In some circumstances, tip pooling is a legal and acceptable practice. How the company handles tip pooling determines whether it is a legitimate business practice or a form of wage theft.

In general, workers should not have to share their wages with managers, owners or others paid on a salary basis. Even if their supervisor or the restaurant owner sometimes helps run food to tables or seat customers when they arrive, they should not demand a portion of the tips earned by hourly service workers.

Servers also should not have to share their tips with individuals who aren’t part of the actual service process. Requiring that workers tip out cooks could be inappropriate. However, mandating that they all share so that each server receives an equal amount of the tips received overall is not a wage violation.

Discussing the specifics of a tip pooling scenario can help workers determine if an employer violated their wage rights. Tip pooling is not automatically illegal but can sometimes violate the rights of individual employees.