Legal Question in Employment Law in California

Tip sharing: Is this legal!?

I work at a restaurant in CA where I am required to tip out, in my opinion, quite a lot. Is this legal?

1. I am required to tip out 6% of my sales (after taxes) to the "house" which goes to sushi chefs, busboys, cooks, and even dishwashers (who knows where else maybe managers too). Average tipout is $75 a night! (the most I have tipped out is $130 in a night) Even if i dont get a tip at all from a customer, I have to pay out of my pocket 6% of that check.

2. If I add auto gratuity to a party of 6 or more I have to pay back 8.75% of the tip back to my employer. This usually results in about 5-10 dollars a night.

3. I also have to tip my busboys on top of the 6 percent because they will not help me if I don�t! That's an extra 15-20 a night.

4. My paychecks are never anymore than $80- my last one was $11.50 some have been voided $0.00 and that is for 35+ hours because my tips are deducted from my paycheck.

5. All of the tips that are credit card are deducted and claimed on my paycheck and many times it claims more than I take home because I tip out to the "house" about 50% of what I end up making especially now that people are tipping less. For instance, if I get on average 10% tips on a night I have to give the "house" 6% and I only keep 4%.

I have been doing research on this but I keep getting mixed answers. Can someone please help?!

Thank you


Asked on 8/15/09, 3:04 pm

1 Answer from Attorneys
Michael Kirschbaum Law Offices of Michael R. Kirschbaum

California courts have allowed restaurants to impose tip pools on wait staff, to share with other employees in the chain of service. But management should not be participating in the tip pooling, if they are not part of the service. However, you are still supposed to be making no less than the state mandated minimum wage of $8.00 per hour for the time worked. If the tip pooling is causing you to receive less than minimum wage, the practice is illegal.

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Answered on 8/15/09, 4:41 pm


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