Is Your Employer in Compliance with California’s Tip Law?

Many employees in California rely on tips as part of their income. If you are among them, then you know that tips are very important to make ends meet. Waiters, waitresses, house cleaners, bartenders, delivery drivers, bellhops, and cab drivers are all professions that customarily count on tips to make up the shortfall left by their hourly wages. Most tipped jobs are low-paying to start with, which makes it almost unbelievable that some unscrupulous employers try to circumvent the state’s tip laws. But it happens, and it happens often. If your employer is not in compliance with California’s tip laws, then you may have grounds for a claim against your employer.

At Rager & Yoon – Employment Lawyers, we are champions for the working people of California. If your employer is not giving you a fair shake when it comes to the tips you earn, contact our Los Angeles employment law team right away to discuss your rights.

Tips Belong to Employees, Not Employers

Labor laws in California are cut and dry when it comes to tipping. Employers are forbidden from keeping any portion of gratuities for employees or sharing in any tips left by customers for employees. The legal definition of a tip in California is money that is left by a customer in an amount that exceeds the amount due for goods or services. It can also include presents and gifts, so long as the customer does not have an obligation to give them. Simply put: tips belong to employees, and employers have no right to them.

Tips are not part of the wages that you receive for your job. California law says that employers must pay you the legal minimum wage, and employers cannot deduct tips from the minimum wage that is required to be paid.

Tip Pooling

The practice of tip pooling is legal in the state of California. This is the practice of putting all of the tips received by all employees into a pool that is divided among all employees. California employers can impose a tip pool, even if employees don’t agree. However, tip pools are only legal when certain employees providing services share in the pool.

For example, in a food service setting, wait staff, bartenders, bussers, and hosts might share in a pool. Dishwashers, cashiers, and cooks would not, since they are not performing the same type of service. Supervisors, managers, and employers must not be part of the pool. Tips in the pool must also be distributed in a reasonable and fair fashion. The Dept. of Labor Standards Enforcement in California suggests that a reasonable way to distribute tips in the above-described pool would be to give 80 percent of tips to wait for staff, 15 percent to bussers, and 5 percent to bartending staff.

Keep in mind that mandatory charges on a customer’s bill are not counted as tips in California. These charges are diverted to the employer.

Are You Getting Your Tips?

If your employer has violated California’s tipping laws, then Rager & Yoon – Employment Lawyers wants to know. Reach out to our employment law team in Los Angeles now to speak with our compassionate and knowledgeable team at 310-527-6994.