Tips and tip pooling rules in California law

| Sep 23, 2020 | Employee Rights, Wage & Hour Laws |

Leaving a tip in a restaurant, bar or another establishment remains a common practice in Los Angeles. The person leaving the tip may think that all the money goes to the wait staff. In reality, the tip may be part of a “pool.” The pool splits the money between the wait staff, a busser and, in some cases, a bartender. The split could require a member of wait staff to give 10% to the busser and 5% to the bartender, the reason being that they work on tips too and also contributed to the customer’s service. What is not allowed, however, is the payment of money to the employers or supervisory staff.

Rules and regulations involving “tip pooling” appear in California statutes. The law remains quite clear that employers, supervisors and managers may not take a cut of tips. However, “back of the house” employees may receive a percentage.

A “back of the house” employee might be someone involved in the serving process who does not deal directly with the customer. A chef or dishwasher would likely fall under the description of a “back of the house” employee. A host or hostess who does little more than seat a customer might be barred from receiving a significant amount of tip money, though.

Such rules and regulations exist to protect employees and their property. Tips left to bartenders, for example, are the property of the bartender. Employers may not take a bartender’s tips as commission for the privilege of working at a busy bar.

Laws related to tipping in California may be set forth by the Division of Labor Standards Enforcement, the Department of Labor or the courts. The average worker may be unaware of how the laws define wage disputes, so someone with a dispute may want to consult with an attorney if they are being paid unfairly.