# Employer is keeping my tips **URL:** \ **Category:** Factual Questions\ **Created:** [July 6, 2006, 4:41pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387 "2006-07-06T16:41:38Z")\ **Posts on this page:** 20\ **Page:** 5
**Author:** ![Monty](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/monty/32/47_2.png) [@Monty](https://boards.straightdope.com/u/Monty)\ **Post date:** [July 10, 2006, 12:14am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/81 "2006-07-10T00:14:41Z")
indecisive1: Aren’t employees protected from retalitory firing if they expose (“blow the whistle”) on their employer’s illegal acts? ---
**Author:** ![Guinastasia](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/guinastasia/32/5751_2.png) [@Guinastasia](https://boards.straightdope.com/u/Guinastasia)\ **Post date:** [July 10, 2006, 12:26am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/82 "2006-07-10T00:26:33Z")
[QUOTE=Monty] indecisive1: Aren’t employees protected from retalitory firing if they expose (“blow the whistle”) on their employer’s illegal acts? [/QUOTE] They should be, although I don’t know if I’d still want to work there-they could make it mighty unpleasant for you. ---
**Author:** ![hawksgirl](https://avatars.discourse-cdn.com/v4/letter/h/ed655f/32.png) [@hawksgirl](https://boards.straightdope.com/u/hawksgirl)\ **Post date:** [July 10, 2006, 12:50am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/83 "2006-07-10T00:50:38Z")
I’m not seeing a problem with his pay, its that customers think they are tipping the staff and they aren’t. THAT’S the part that looks wrong to me. ---
**Author:** ![Monty](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/monty/32/47_2.png) [@Monty](https://boards.straightdope.com/u/Monty)\ **Post date:** [July 10, 2006, 1:00am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/84 "2006-07-10T01:00:19Z")
AFAIK, tips are part of the employee’s pay. If the management is keeping the tips, the management’s keeping the pay. ---
**Author:** ![Excalibre](https://avatars.discourse-cdn.com/v4/letter/e/898d66/32.png) [@Excalibre](https://boards.straightdope.com/u/Excalibre)\ **Post date:** [July 10, 2006, 1:05am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/85 "2006-07-10T01:05:37Z")
[QUOTE=hawksgirl] I’m not seeing a problem with his pay, its that customers think they are tipping the staff and they aren’t. THAT’S the part that looks wrong to me. [/QUOTE] The thing is, regardless of how well the staff is being paid (and $7.50 is not exactly a generous wage), the workers are entitled to the tips they are being given. At least under the law quoted earlier in the thread. Like I said, even if the workers agreed to such an arrangement in their ignorance, you can’t give up your legal rights by signing a contract. I have to say that I feel a particular distaste for a business, no doubt a rather well-off one, taking advantage of teenagers’ ignorance to stiff them of what is rightfully theirs. The customers have the right to see their money given to the staff, and the staff have the right to see that money given them. Trying to separate the two halves of that, the giving from the receiving, makes little sense to me. ---
**Author:** ![GrandWino](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/grandwino/32/67_2.png) [@GrandWino](https://boards.straightdope.com/u/GrandWino)\ **Post date:** [July 10, 2006, 2:26am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/86 "2006-07-10T02:26:25Z")
I’ve spent some time working in the hospitality industry, and many hotels do something like this: All banquets are charged an extra 18% on food purchased. This money is pooled together, and is split based on a “tip point.” The head chef, banquet manager, bqt captains, etc - get a higher percentage than the grunts that wash dishes and set up the room and serve the food. Based on your tip point, at the end of the pay period, the amount in the gratuity pool is divied up in a “per hour” basis. You are paid minimum wage + your “per hour” gratuity which varies based on the amount of money generated into the Gratuity Pool. Usually only $1-2 per hour, except around the holidays when XMas parties are in full swing. I don’t remember if this money was taxed as tips, or as regular income because of how it’s paid out. Seems to me, the OP is already being paid above minimum wage, and though it’s shady for the club to not want its staff to tell the customers how they pay their employees (though, do any businesses want you discussing this sort of thing w/ their patrons?) - the money above Minimum Wage he’s taking home probably makes up for the gratuities he thinks he’s owed. Would he rather get minimum + grat, or his higher wage? It’s probably a wash. ---
**Author:** ![Excalibre](https://avatars.discourse-cdn.com/v4/letter/e/898d66/32.png) [@Excalibre](https://boards.straightdope.com/u/Excalibre)\ **Post date:** [July 10, 2006, 7:35am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/87 "2006-07-10T07:35:49Z")
[QUOTE=HelloNinja] Would he rather get minimum + grat, or his higher wage? It’s probably a wash. [/QUOTE] That strikes me as unlikely; most waitstaff I’ve known get considerably more than that. Besides, nobody can really guess - they’re not keeping track the way they should be. If indeed he’s getting the same as he would otherwise, then it’s not a big deal. But what’s the evidence he is? ---
**Author:** ![Monty](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/monty/32/47_2.png) [@Monty](https://boards.straightdope.com/u/Monty)\ **Post date:** [July 10, 2006, 7:47am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/88 "2006-07-10T07:47:50Z")
From where I see, it doesn’t matter about the druthers. The employer is keeping the tips. Now, unless the tipper designated the management as the tippee, then that’s not exactly the nice thing to do. ---
**Author:** ![Cheesesteak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cheesesteak/32/3694_2.png) [@Cheesesteak](https://boards.straightdope.com/u/Cheesesteak)\ **Post date:** [July 10, 2006, 2:10pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/89 "2006-07-10T14:10:37Z")
[QUOTE=Excalibre] Why do you assume that you are capable of deciding what the law is, when obviously you don’t have any experience or knowledge of it? [/QUOTE] Obviously, I’m not. Why don’t we ask [Alfred B. Robinson, Jr.](http://www.dol.gov/esa/whd/opinion/FLSA/2005/2005_09_02_31_FLSA.htm) , Deputy Administrator at the US Department of Labor whether or not a fixed percentage gratuity automatically added to your bill is legally a tip? > [@](#): > > However, 29 C.F.R. § 531.52, (copy enclosed), distinguishes between a tip voluntarily paid by a customer and a mandatory charge imposed upon the customer. “Whether a tip is to be given, and its amount, are matters determined solely by the customer.” Id. For example, “a compulsory charge for service, such as 10 percent of the amount of the bill, imposed on a customer by an employer’s establishment, is not a tip and, even if distributed by the employer to his employees, cannot be counted as a tip.” See 29 C.F.R. § 531.55(a) (copy enclosed). Furthermore, these charges “which become a part of the employer’s gross receipts are not tips for purposes of the Act.” Therefore, the 18% gratuity is not legally a tip, and doesn’t factor into whether or not Scuba Steve is a “tipped employee”. It also looks like there’s precedent to adding those charges to the employer’s gross receipts instead of distributing to the employee, so I doubt that is automatically illegal. Don’t agree? Take it up with the Department of Labor. ---
**Author:** ![Waenara](https://avatars.discourse-cdn.com/v4/letter/w/50afbb/32.png) [@Waenara](https://boards.straightdope.com/u/Waenara)\ **Post date:** [July 10, 2006, 2:27pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/90 "2006-07-10T14:27:40Z")
> [@Cheesesteak](#): > > Therefore, the 18% gratuity is not legally a tip, and doesn’t factor into whether or not Scuba Steve is a “tipped employee”. It also looks like there’s precedent to adding those charges to the employer’s gross receipts instead of distributing to the employee, so I doubt that is automatically illegal. Even if the 18% gratuity isn’t a tip, I’d think that the additional tips some customers give _would_ be considered a tip. The fact that the management leaves an _additional_ “tip” line on the bill (in addition to the gratuity/service charge), and that they don’t give the additional tip to the staff, makes it seem to me that they’re knowingly ripping off their employees for those tips. ---
**Author:** ![Excalibre](https://avatars.discourse-cdn.com/v4/letter/e/898d66/32.png) [@Excalibre](https://boards.straightdope.com/u/Excalibre)\ **Post date:** [July 10, 2006, 3:25pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/91 "2006-07-10T15:25:19Z")
[QUOTE=Cheesesteak] Obviously, I’m not. Why don’t we ask [Alfred B. Robinson, Jr.](http://www.dol.gov/esa/whd/opinion/FLSA/2005/2005_09_02_31_FLSA.htm) , Deputy Administrator at the US Department of Labor whether or not a fixed percentage gratuity automatically added to your bill is legally a tip? Therefore, the 18% gratuity is not legally a tip, and doesn’t factor into whether or not Scuba Steve is a “tipped employee”. It also looks like there’s precedent to adding those charges to the employer’s gross receipts instead of distributing to the employee, so I doubt that is automatically illegal. Don’t agree? Take it up with the Department of Labor. [/QUOTE] Um, they’re keeping the _actual_ tips as well. You’re really grasping at straws here, bud. ---
**Author:** ![Cheesesteak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cheesesteak/32/3694_2.png) [@Cheesesteak](https://boards.straightdope.com/u/Cheesesteak)\ **Post date:** [July 10, 2006, 4:37pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/92 "2006-07-10T16:37:48Z")
[QUOTE=Waenara] Even if the 18% gratuity isn’t a tip, I’d think that the additional tips some customers give _would_ be considered a tip. [/QUOTE] I think you’re right. ---
**Author:** ![Cervaise](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cervaise/32/16693_2.png) [@Cervaise](https://boards.straightdope.com/u/Cervaise)\ **Post date:** [July 10, 2006, 5:12pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/93 "2006-07-10T17:12:43Z")
[QUOTE=Excalibre] You’re really grasping at straws here, bud. [/QUOTE] But it’s an upscale country club, so they can afford to use the flexy straws. ---
**Author:** ![Jeff\_Lichtman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jeff_lichtman/32/1531_2.png) [@Jeff\_Lichtman](https://boards.straightdope.com/u/Jeff_Lichtman)\ **Post date:** [July 10, 2006, 6:24pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/94 "2006-07-10T18:24:12Z")
[QUOTE=Cheesesteak] Obviously, I’m not. Why don’t we ask [Alfred B. Robinson, Jr.](http://www.dol.gov/esa/whd/opinion/FLSA/2005/2005_09_02_31_FLSA.htm) , Deputy Administrator at the US Department of Labor whether or not a fixed percentage gratuity automatically added to your bill is legally a tip? [/QUOTE] This opinion letter answers a questions about whether, with a fixed gratuity that’s passed on to the employee, the employee can be classified as a tipped employee for the purposes of minimum wage and overtime rules. The letter states that the employee cannot be classified this way under this scenario. It does not state that the employee isn’t entitled to receive the fixed gratuity - in fact, the scenario in the letter assumes that the gratuity goes to the employee. ---
**Author:** ![Guinastasia](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/guinastasia/32/5751_2.png) [@Guinastasia](https://boards.straightdope.com/u/Guinastasia)\ **Post date:** [July 10, 2006, 6:47pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/95 "2006-07-10T18:47:54Z")
[QUOTE=Excalibre] That strikes me as unlikely; most waitstaff I’ve known get considerably more than that. Besides, nobody can really guess - they’re not keeping track the way they should be. If indeed he’s getting the same as he would otherwise, then it’s not a big deal. But what’s the evidence he is? [/QUOTE] That and the fact that tips aren’t even being divided up among the staff-the bosses seem to be pocketing everything. And quite honestly, let’s say they’re doing NOTHING wrong, legally. Well, then the proper authorities will deal with it then. Right now, something looks shady-so what’s wrong with checking it out? ---
**Author:** ![Scuba\_Ben](https://avatars.discourse-cdn.com/v4/letter/s/278dde/32.png) [@Scuba\_Ben](https://boards.straightdope.com/u/Scuba_Ben)\ **Post date:** [July 11, 2006, 1:13am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/96 "2006-07-11T01:13:41Z")
I checked the 5-in-1 Labor Law poster at my office today (it’s right next to the coffee machine). Granted, it’s a bit out of date, with a minimum wage of $4 and change, but I think the relevant point still holds: According to that poster, if a tipped employee’s cash wages plus tips do not add up to the applicable minimum wage – not the _tipped_ minimum wage but the _standard_ minimum wage – then the employer must pay the difference to achieve the minimum wage. Whatever the current legalities may be, the situation smells to me of low ethics. But that’s IMnsHO, not GQ. ---
**Author:** ![gigi](https://avatars.discourse-cdn.com/v4/letter/g/a587f6/32.png) [@gigi](https://boards.straightdope.com/u/gigi)\ **Post date:** [July 11, 2006, 2:23pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/97 "2006-07-11T14:23:31Z")
[QUOTE=Scuba\_Ben] According to that poster, if a tipped employee’s cash wages plus tips do not add up to the applicable minimum wage – not the _tipped_ minimum wage but the _standard_ minimum wage – then the employer must pay the difference to achieve the minimum wage. [/QUOTE] He did mention that he receives more than minimum wage, so that’s covered. hijack - your sig reminds me of the Michael Peterson song: I want to drink from your loving cup Swear I’ll never give you up Steal all your kisses underneath the moon I wanna lie here close to you look at what you made me do Darling you’re the reason why I drink, swear, steal and lie /hijack ---
**Author:** ![handsomeharry](https://avatars.discourse-cdn.com/v4/letter/h/e9c0ed/32.png) [@handsomeharry](https://boards.straightdope.com/u/handsomeharry)\ **Post date:** [July 11, 2006, 9:19pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/98 "2006-07-11T21:19:02Z")
[QUOTE=Monty] indecisive1: Aren’t employees protected from retalitory firing if they expose (“blow the whistle”) on their employer’s illegal acts? [/QUOTE] On that point I seem to recall that the laws/enforcement/technicalities on the “protection” laws make whistleblowing about as effective as a written resignation. hh ---
**Author:** ![Scuba\_Ben](https://avatars.discourse-cdn.com/v4/letter/s/278dde/32.png) [@Scuba\_Ben](https://boards.straightdope.com/u/Scuba_Ben)\ **Post date:** [July 11, 2006, 11:55pm UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/99 "2006-07-11T23:55:24Z")
[QUOTE=gigi] He did mention that he receives more than minimum wage, so that’s covered. [/quote] Good question for the OP: **Scuba Steve** , does the person in question make more than the standard minimum wage, or than the tipped-employee minimum wage? > [@](#): > > hijack - your sig reminds me of the Michael Peterson song > /hijack Nice song. It’s probably the inspiration for the Diver’s Toast, which I learned on a dive trip last year. ---
**Author:** ![Scuba\_Steve](https://avatars.discourse-cdn.com/v4/letter/s/e79b87/32.png) [@Scuba\_Steve](https://boards.straightdope.com/u/Scuba_Steve)\ **Post date:** [July 12, 2006, 6:08am UTC](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387/100 "2006-07-12T06:08:28Z")
Sorry for the absence. I’ve been waiting on an e-mail from a fellow at the newspaper. He’s helped out friends of mine before, but was out of town until Monday. Still no e-mail; I’ll be making phone calls tomorrow to the newspaper, hoping anyone will do this. Any ideas on how I should pitch this? [Previous page](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387.md?page=4) [Next page](https://boards.straightdope.com/t/employer-is-keeping-my-tips/363387.md?page=6)