UnderCover Waitress: Another Tip Pool Lawsuit

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Wednesday, January 25, 2012

Another Tip Pool Lawsuit

This time, the restaurant being sued is in the state of Colorado.

Cache Cache restaurant and its owners, Jodi Larner and Chris Lanter, are being sued for running an illegal tip pool for its employees. Cooks, dishwashers, and other back of house employees were given a share of the tips. In Colorado, this is illegal. Only front of house employees may participate in tip pools.

This is about greed. People see waitresses making tip money, and they think they have a right to it. Just the like the bartender who favors the waitress who lines his pockets, a cook may think, "I got the food out quickly, I deserve a tip."

Many restaurant owners don't want to pay good wages to their staff. This is about greed. Owners want to keep as much money for themselves as possible. So, they underpay their staff. Staff looks at the waitresses making tips, and get jealous. On good nights, anyway.

If we ask ourselves "who should be paying the cooks for their efforts?" I daresay the answer would be the cook's employer, not the least powerful and most expendable of the restaurant's employees. Greedy owners turn the waitresses into income-producers for other, underpaid staff.

For the record, if you are on the floor with me, actively helping me serve my tables by bussing or running food, I have no problem sharing the take and tipping you out. There are places in which waitresses may have to tip others out more than twenty percent of their take; that is ridiculous.

Industry mantra when we complain about having to give everybody our tips is that "if we have to pay all of the staff better wages, prices will go up, and nobody will eat out." That's baloney on many levels. The least of it is that eating out is expensive, anyway, and yet people continue to do it in a destroyed economy.

More important, the next time a restaurant owner says he can't pay his staff better wages, look at what he drives. Now look at how the waitresses, who are sometimes required to pool tips to give to other staff, get to work. And ask yourself who is responsible for paying the restaurant staff's wages. 

8 comments :

  1. It sounds as if Larner and Lanter need a good smack upside the head for this one... obviously a lawsuit will have to do.

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  2. States that regulate restaurant labor tend to prevent tips from being taken by management or anybody in the "back of house" (kitchen.) I can't believe any owner (in those states) would not know this. Vermont is one example of an unregulated state; management routinely take tips but usually not the kitchen staff, to the best of my knowledge.

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  3. Does it make sense to you that there would be a federal or state law that defines who can share in the customer's private property, his tip?

    The truth of the matter is, there is no law that explains who is entitled to share in the customer's tip. We are talking about the customers's private property. No law would infringe on the private property of our citizens in such a way. It's simply a lie made up to deceive workers into believing that federal laws do not protect the tips of an individual worker who is given a tip.

    Federal laws state that nothing in this section shall be construed to prohibit the pooling of "tips" among employees who customarily and regularly receive tips. 29 USC section 203(m).

    The key word in this statute is "tips". Federal regulations, CFR 531.52 has defined tips, for the purposes of understanding section 203(m), as money belonging to an employee which he may use as he chooses free of any control of the employer.

    What the law is stating is, nothing in this section shall be construed to prohibit an employee who customarily and regularly receives tips from using his tips for a tip pool that is free of any control of the employer.

    When an employer requires tip pooling he is undoubtably misinterpreting section 203(m) to where his employees are unlawfully prohibited from using their tips for a tip pool which is free of any control of the employer. As such, the employer is violating federal law by misconstruing section 203(m) to where the pooling of "TIPS", as defined under federal regulations, is prohibited.

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  4. Hi, George.

    I am not sure I agree with a couple of your points. 1) You state that the tip is the private property of the customer. The customer owns his money until he spends it. It ceases being his at that point. So, when he orders food and pays his bill, the money used to pay for the food is no longer his. The restaurant owner, however, may use the money received however she sees fit.

    Once the tip is paid, it ceases to be the private property of the customer. There are many hairs to be split in discussing and debating the definition of the tip, for example, no it was not required so it is not like paying a bill. The tip is expected and is restaurant employee's pay, so it is like a bill. And so on.

    2) In plain language, the federal law is only stating that if servers want to share their tips, they may do so. The employer, however, may not mandate if or how they do so. No skilled waitress wants to give away her tips.

    The laws being discussed in the above post are of the state of Colorado. Colorado laws do not "misinterpret" federal law. State laws add to the federal laws.

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  5. I tip out a full 35% almost every shift. It's ridiculous. I don't mind tipping out, but 35% is a HUGE chunk.

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  6. my daughter just got a job in indian restaurant he's keeping on her test, the owner I mean. now he is paying her slightly under minimum wage, the whole point of being a waitress is having the advantage of having money everyday, my daughter is seeing how she's getting tipped, no we calculated that if she made a regular waitress page and cats with hats she's actually making way more money than the hourly rate he is paying her. Who can I contact to report him. Please excuse typos, as my keypad is malfunctioning. Please leave any suggestions ohio dental girl at yahoo.com

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  7. my daughter just got a job in indian restaurant he's keeping on her test, the owner I mean. now he is paying her slightly under minimum wage, the whole point of being a waitress is having the advantage of having money everyday, my daughter is seeing how she's getting tipped, no we calculated that if she made a regular waitress page and cats with hats she's actually making way more money than the hourly rate he is paying her. Who can I contact to report him. Please excuse typos, as my keypad is malfunctioning. Please leave any suggestions ohio dental girl at yahoo.com

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  8. My point was, while it has been suggested that "Only front of house employees may participate in tip pools", it's incorrect and misleading to suggest that certain types of employees are eligble to participate in a tip pool.

    Federal Regualtions state, CFR 531.52

    A tip is a sum presented by a customer as a gift or gratuity in recognition of some service performed for him. It is to be distinguished from payment of a charge, if any, made for the service. Whether a tip is to be given, and its amount, are matters determined solely by the customer, who has the right to determine who shall be the recipient of the gratuity. Tips are the property of the employee whether or not the employer has taken a tip credit under section 3(m) of the FLSA.

    Tips belong to the customer until they are given to an employee. At that point, they become the property of the employee (singular).

    My point is, neither state or federal laws would attempt to define who can or can't participate in the sharing of tips when clearly tips are defined as private property. While tips might not actually belong to the customer after they have been given to a worker, customer's still retain third party rights ot insure that their tips are delivered to the person they chose to tip. This is common law princliple known as third party rights.






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