tip pools

I work at a restaurant that requires tipped employees to put a percentage of daily sales into a shared tip pool that is spread out among bussers, bartenders and expos....which is fine but I recently discovered that the house also keeps a percentage of this pool....Is that legal and or ethical???

I would be interested to hear what owners and managers think of this practice....

It may be LEGAL...But Ethical..I say No No NO

[Robin Garr]

I work at a restaurant that requires tipped employees to put a percentage of daily sales into a shared tip pool that is spread out among bussers, bartenders and expos....which is fine but I recently discovered that the house also keeps a percentage of this pool....Is that legal and or ethical???

I would be interested to hear what owners and managers think of this practice....

Good question ... I suspect it's not illegal, but it's the kind of practice that would have me heading right on down the road if it was a place where I worked.

I'll be interested, too, to hear what our in-the-business folks have to say.

Years ago I worked in a cafe that did the same thing. I was told that it was to cover the bank charges for credit card uses in the restaurant. For instance if the bank charged the restaurant 5% for a credit card transaction then the restaurant could turn around and charge the foodserver up to 5% of his tip back. I didn't think any restaurant still did this. Doesn't seem to be a very good way to build employee loyality.

I sure would like to see a list of places that do that...I sure would not support them....

Kentucky law says employers cannot mandate tip pooling; tip pooling may be voluntarily entered into mutually between employees at a restaurant but management may have no role in it - can't distribute tips, but could provide a safe place for them before distribution.

Stacy Roof
Kentucky Restaurant Association

Well Jim that answers that....was it voluntary at your place?

Kentucky law says employers cannot mandate tip pooling; tip pooling may be voluntarily entered into mutually between employees at a restaurant but management may have no role in it - can't distribute tips, but could provide a safe place for them before distribution.

Stacy Roof
Kentucky Restaurant Association

I believe that is correct and I might also add that managers, technically, can't take tips either. I know that when I was at Mortons, this quickly became an issue as a percentage went to managers/captains for corking wine. I'm not sure that that is the case any longer as I think they were sued over the issue. Likewise at Caesars as the gaming commision has a big problem with managers getting "palmed" since they don't get their cut in that event.

Dave,
I agree with you - management absolutely shouldn't take a share of tips.

This issue has cost a lot of employers a lot of $$ over the years.
Stacy

The last locally owner restaurant that I work for encouraged us to tip out a certain percentage of our tips to the bar, foodrunners, and hostesses. While it wasn't technically a requirement, those on the receiving end knew who tipped out and how much. The restaurant is under new mgmt. now, but when I was there, the managers were taking about about $5 a piece from the tip outs every night. Doesn't seem like much, but it really adds up.

Does this happen because they dont have the volume of customers as other places do and the tips made each shift are not very much????

In my experience, especially in fine dining, servers absolutely must tip out at least the bar and bussers. Prima facie, this may seem silly; why would a server give up hard-earned tips? However, if one wants to experiment and stiff the bar and/or busser after a busy weekend night, one quickly learns that taking care of the people who help you makes a lot of sense.

As far as the management/house taking a cut to offset credit card fees, that practice is hogwash. If you find yourself working in such an establishment, find a new job, or wait a few weeks...they won't be in business long. Businesses surrender processing fees in order to attract customers that they wouldn't otherwise attract. The additional revenue generated from accepting credit cards should offset the fees. If not, then the owner's should only cash.

I'm sure the original poster would be disinclined to share the name of his employer, but I sure would like to know so I can cross them off my list of restaurants to patronize.

[Robin Garr]

In my experience, especially in fine dining, servers absolutely must tip out at least the bar and bussers. Prima facie, this may seem silly; why would a server give up hard-earned tips? However, if one wants to experiment and stiff the bar and/or busser after a busy weekend night, one quickly learns that taking care of the people who help you makes a lot of sense.

Good thoughts, John, and thanks for the analysis. I absolutely agree: Tipping out the other team members makes sense, not just for ensuring that they'll work with you but because it's fair.

But management taking a bite, that's a whole 'nother story. Not just illegal, but as someone else pointed out, it's just plain stupid if management has any interest in having any sense of team spirit or "ownership" whatsoever on the part of staff.

I am actually an ex- Louisvilllian and do not live in the area anymore..(i just can't stop using this forum) so the establishment in question wouldn't effect any of your responsible dining habits...

I am considering possible legal action as well....It just really p**sses me off that management would take advantage of unknowing staff...no one had really asked about it before....

I'll have to check the law here.
Thanks for your input...I'll keep you posted ...

The tip pool is required.....however you sign into an agreement when hired...although it does not specify where that money goes....just that you agree to do it...maybe at work today I'll try and grab a copy of that agreement and post it here....