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Is this tip pool legal? -Texas

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Tippool

New member
Is a tip pool illegal if it covers 2 different locations?
I work in a restaurant who recently opened up a second restaurant in another part of town. Usually, we participate in a tip pool where all the counter service employees share in all tips made dependent on how many hours they've worked. This made sense while there was only one location. Now that they have opened up this second location they are still engaging in this tip pool but across both locations. This second location is significantly less busy. So while I'm making 90% of the tips at the location I'm at, we're splitting those tips equally across both locations. Just to be clear, this means employees at location 2 are receiving tips from customers who are visiting location 1. Is this legal? Some employees have shifts at both locations. Would their tips have to be calculated based on hours worked at each location?
 


HRZ

Senior Member
I'm not aware of a rule against multi site tip pools ...but serving different customers at different places is probably not what the drafters envisioned ....things are legal unless there is a rule against it . I get your point about being the tip maker.

As a technical point ..sometimes restaurants are separate legal identities at each site even if they use a common name for marketing purposes ...
 

Zigner

Senior Member, Non-Attorney
http://www.twc.state.tx.us/news/efte/tip_pooling.html

There are strict rules that must be followed before tip pooling is allowed. In essence, employees have to agree to it and the pool must be shared only among those who interact with the customer as part of their dining experience. In your case, the employees at the other restaurant shouldn't be a part of the tip pool in your restaurant.

Are supervisors and back-of-the-house workers included in the pool? If so, then the pool is illegal.
 

Zigner

Senior Member, Non-Attorney
I'm not aware of a rule against multi site tip pools ...but serving different customers at different places is probably not what the drafters envisioned ....things are legal unless there is a rule against it . I get your point about being the tip maker.
Actually, it's quite clear. If Bob comes in to restaurant A and leaves a tip, the employees at restaurant B are not entitled to a portion of the tip because they weren't a part of that customer's experience.
 

PayrollHRGuy

Senior Member
It doesn't apply to this situation but the March 2018 Omnibus Law removed the ban on Back of the House employees from the tip pool.
 

Zigner

Senior Member, Non-Attorney
It doesn't apply to this situation but the March 2018 Omnibus Law removed the ban on Back of the House employees from the tip pool.
So as not to confuse the OP: That is Federal. The state also has laws that haven't been changed.
 

PayrollHRGuy

Senior Member
I thought you were talking about the federal ban. Because there isn't a state BAN on back of the house.

From your link....

  1. Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements. The following employee occupations would therefore not be eligible to participate:
    1. janitors
    2. dishwashers
    3. chefs or cooks
    4. laundry room attendants
  2. However, it does not appear that Congress ... intended to prevent tipped employees from deciding, free from any coercion whatever ..., what to do with their tips, including sharing them with whichever co-workers they please. Tips given to such co-workers as are listed in this subsection may not, however, be used as a tip credit.
 

Zigner

Senior Member, Non-Attorney
I stand corrected - I got my information from more than one private site and they were wrong.
 

xylene

Senior Member
Consider to find a different job where they aren't jerking you around with quasi-legal shenanigans.
 

Tippool

New member
http://www.twc.state.tx.us/news/efte/tip_pooling.html

There are strict rules that must be followed before tip pooling is allowed. In essence, employees have to agree to it and the pool must be shared only among those who interact with the customer as part of their dining experience. In your case, the employees at the other restaurant shouldn't be a part of the tip pool in your restaurant.

Are supervisors and back-of-the-house workers included in the pool? If so, then the pool is illegal.
Yeah even without this weird situation the tip pool is illegal because managers get tips. Which I brought to attention some time ago was illegal and they tried to convince me it wasn’t
The employees at the other location are being paid a tipped wage and I’m pretty sure that’s why they’re forcing us to “share” tips. I doubt they’d be making minimum without our tips and on top of that they were promised a certain amount in tips which is definitely not being made.
 

PayrollHRGuy

Senior Member
You probably should be looking for a new job.

That said don't just tell them it is illegal SHOW them. Print the link that Zigner posted and put it in their hands.
 

HRZ

Senior Member
You forgot to mention up front that managers got a cut of tip pool
.thats illegal ....but the messenger of bad news may get " reassigned "

I think it's rather grey as to if one can have a multi site pool ...IF the employees "agree" to pool, as the law requires , it might not be illegal ...odd does not make it illegal. IF all the major tip action is at site A ...obviously the B site employees love it...I have no clue if A site employees can opt out of the pool.

I be heard of some very nasty pool arrangements which amount to a fee to work there ....but enforcement may not be a local priority ...and one sports bar near me assigns shifts based on sex knowing women generate higher tips for the pool ...and they get prime hours ...smells , yes...but my young friend made more in tips than her other shift as a RN.
 

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