Some restaurants pool tips.
Tip pooling is the practice of combining all tips earned by all servers and putting them into one lump sum for distribution later by means of a formula developed by the establishment.
Tip pooling is not practiced frequently in restaurants but it does occur and there are strict rules associated with implementing tip pooling in your restaurant.
There are basically two scenarios.
- If you pay tipped employees less than the minimum wage (use their tips to bring them up to minimum), you can tip pool among tipped employees but cannot share any tips with non-tipped, back-of-the-house employees or managers.
- If you want to share tips with back-of-the-house employees, then you must pay the full minimum wage to tipped employees (not use tips to bring them up to minimum).
Even under this scenario, under the new law, you cannot share tips with managers or other salaried employees. You may share with bus-persons, runners, bartenders, hostesses, cooks, dishwashers, etc.