Tip Pooling Laws and Your Restaurant

March 27, 2018

You’ve probably heard us talk about changes to Tip Pooling recently. The Federal government repealed the regulation that restricted sharing tips among front of house and back of house employees. There are a few things you need to know if you decide to institute a legal Tip Pool for your establishment.

First, you must pay all employees at least the full Colorado minimum wage and not the tipped minimum wage

SECOND

Second, you must not include managers, supervisors, or owners in the tip pool

THIRD

Third, you must post a printed sign in a conspicuous location informing the general public that the restaurant shares tips among the employees.

SIGN DIMENSIONS AND LANGUAGE
Colorado law states that the publicly displayed sign must be 12 x 15 inches, with letters 1/2 inch tall and must use the following language:  ALL PRESENTS, TIPS, OR GRATUITIES GIVEN BY ANY PATRON OF SAID BUSINESS TO AN EMPLOYEE THEREOF ARE NOT THE PROPERTY OF SAID EMPLOYEE BUT BELONG TO THE EMPLOYER. On our sample sign, we added some language to more fully explain the intent behind the sign. This language is optional: AT THIS ESTABLISHMENT WE DISTRIBUTE PRESENTS, TIPS AND GRATUITIES EVENLY AMONG ALL OF THE EMPLOYEES WHO HELP PROVIDE YOU WITH A GREAT DINING EXPERIENCE!

(NOTE: While this language stating that tips BELONG TO THE EMPLOYER conflicts with the Federal law stating tips belong to the employee, the sign is still required under the current Colorado law. We are working with the State of Colorado to get this fixed.)

We recommend that you contact our office if you currently have or are considering a tip pool to help you navigate the legal nuances of how to run it properly. Please contact Nick Hoover at the CRA so he can answer your questions or connect you with legal help if needed.

 

CRA Working for You 0217

February 1, 2017

By Sonia Riggs, CRA President & CEO

LOOKING FORWARD
The CRA staff are taking a strong look at our organization to make sure that we are providing value to all our members – whether you are a small, independent restaurant, or a larger restaurant group. Part of that value is making sure that you are receiving the information that we are sending your way. For example, there are several new Colorado laws that you need to be aware of that directly impact your business (explained later in the newsletter) but you may not have heard of them yet because we don’t have the most up-to-date contact information for you. You’ll likely receive a call and email from us in the coming months to make sure we have the correct contact information for you, and that we are communicating the right messages with the appropriate people within your organization. Please bear with us as we work through this process.

 

NATIONAL FIGHT ON TIP POOLING
On a national level, the National Restaurant Association, through their Restaurant Law Center is leading the effort of asking the U.S. Supreme Court to hear a case, National Restaurant Association, et al. v. U.S. Department of Labor, et all. The case challenges the Department of Labor’s anti tip-pooling stance that prevents cooks and dishwashers from receiving tips.  The Fair Labor Standards Act’s (FLSA) tip credit regulations prevent front-of-the-house restaurant employees from sharing tips with back-of-the-house employees if the employer takes a tip credit, meaning some employees earn a tip wage. However, the Department of Labor has now expanded the tip credit regulations, without Congressional action, and is refusing to allow employees to share tips even if the employer does not take a tip credit. This violates the clear language of the law and the intent of the law. Learn more here.

 

LEGISLATIVE SESSION
The Colorado legislative session kicked off on January 11 and we are already actively monitoring bills on a daily basis and have an update on some legislation that we are closely watching. (See the Legislative Update attached to the Newsletter) Feel free to call us if you have any questions or would like to weigh in on an issue. Our legislative committee meets weekly and is open to all members. If you are interested in participating, please contact Nick Hoover at (303) 830-2972.