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Tip & Gratuities

Tip & Gratuities

Posted by admin in Tips for Employers 01 Sep 2013

“Gratuities” include any tip, gratuity, money, or part thereof that has been paid or given to or left for an employee by a patron of a business over and above the actual amount due the business for services rendered or for goods, food, drink, or articles sold or served to the patron.  (Labor Code § 350(e)  Employers are prohibited from using tips as a credit against wages owed by the employer.  Tips are the sole property of the employee or employees to whom they are given or for whom they are left.

An employer that permits patrons to pay gratuities by credit card shall pay the employee the full amount of the gratuity that the patron indicated on the credit card slip, without any deduction for any credit card payment processing fees or costs that may be charged to the employer by the credit card company.  Payment of gratuities made by patrons using credit cards shall be made to the employee no later than the next regular payday following the date the patron authorized the credit card payment. (Labor Code § 351)

Although employees may voluntarily agree among themselves to pool or share their tips, an employer may requiring tip pooling only under certain limited circumstances.  (Leighton v. Old Heidelberg, Ltd., 213 Cal.App.3d 1062 (1990)

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