5 ms·

This is almost certainly going to rarely happen. Almost no server feels empowered enough to insist on this. And restaurant owners will start insisting on collec

This is almost certainly going to rarely happen. Almost no server feels empowered enough to insist on this. And restaurant owners will start insisting on collecting and counting cash tips so they can fully account for the wages. No server wants their boss counting their cash tips. At least in Massachusetts, declared tips is self reported.

greedo 10y ago
I'm surprised this is still allowed by the IRS. When I was a waiter back in the 80's in California, we went from self-reporting to turning in our tips. All the tips were pooled, then divvy'd up between waitstaff, busboys, cooks, managers etc. And taxes were taken documented. So our "paycheck" was puny since the withholding was taken from our hourly payrate.
illumin8 10y ago
I've even seen something very shady recently - a nice restaurant that added a mandatory 20% "service fee" to our party of 7, had fine print that said "60% of your service fee goes to your wait staff." The implication is that not only is this restaurant, which we ended up paying ~$80 a person to eat dinner + wine + dessert at, screwing their customers with the mandatory service charge, they're also screwing their employees by keeping 40% of it for the owner. I won't eat there again... Edit: Added visual proof (and name and shame): https://s3-media4.fl.yelpcdn.com/bphoto/t3UUaCU8gl6zPsVQghlvOQ/o.jpg https://s3-media4.fl.yelpcdn.com/bphoto/t3UUaCU8gl6zPsVQghlv... I would be happy to learn that the 40% was going to the cooks. It's still a shady practice, and what makes it worse than not informing your guests ahead of time is that they're doing this in the name of "providing a livable wage for our staff." Pay your staff a livable salary and stop screwing your customers over...
- ensignavenger 10y ago
  I doubt that the 40% goes to the owner, it probably goes to the kitchen staff.
- nommm-nommm 10y ago
  Hopefully the hostess and back of the house was tipped out with that 40%. It's also likely that 40% went into the owner's pocket though because that's totally legal! Since it was a non-negotiable service fee the DOL doesn't consider it gratuity (as gratuity is strictly optional) so they don't have to pass it on to their staff. I've seen this happen plenty of times, usually in the catering business, though not to the extent of 40%, usually around 5-10%.
- JumpCrisscross 10y ago
  > keeping 40% of it for the owner Depending on the city and state, this could be illegal. I'd encourage you to ask the server if the 40% goes to the kitchen or the owner. If the latter, write a letter or make a call to your labour law enforcement group.
  - nommm-nommm 10y ago
    It's not illegal. https://www.dol.gov/whd/regs/compliance/whdfs15.pdf https://www.dol.gov/whd/regs/compliance/whdfs15.pdf >A compulsory charge for service, for example, 15 percent of the bill, is not a tip. Such charges are part of the employer's gross receipts. Sums distributed to employees from service charges cannot be counted as tips received, but may be used to satisfy the employer's minimum wage and overtime obligations under the FLSA. If an employee receives tips in addition to the compulsory service charge, those tips may be considered in determining whether the employee is a tipped employee and in the application of the tip credit.
    - JumpCrisscross 10y ago
      Hence my caveat, "depending on the city and state". For example, it's not allowed in California [1]. [1] http://www.tipcompliance.com/polLearningCenter.cfm?doc_id=89 http://www.tipcompliance.com/polLearningCenter.cfm?doc_id=89
- jt2190 10y ago
  > The implication is that... they're also screwing their employees by keeping 40% of it for the owner... Probably not. In the restaurant I worked at was customary for the waiters to tip the kitchen and support staff. Owners were not tipped.
- pcvarmint 10y ago
  Others have been willing to backtrack: http://www.seattletimes.com/life/food-drink/seattle-restaurant-mollusk-ends-service-charge-returns-to-tipping/ http://www.seattletimes.com/life/food-drink/seattle-restaura...
sharpplanar 10y ago
I used to do accounting for a restaurant and I would disagree with you and say with the move to modern Point Of Sale software restaurants not doing this would be the exception now. We checked this every pay period to make sure servers were at or over the proper hourly wage because it is illegal to pay them less. Florida based for reference, tips are self reported here too but our POS system would automatically transfer tip amounts when a credit card was the payment method. So our payroll system already has that amount. Then we had an electronic time clock where servers scanned their hand to clock in\out, and it was set to prompt them for declared cash tips. It was a nicer restaurant (avg check a bit over 100$). Occasionally a server wouldn't declare enough tips to hit minimum wage for a pay period and the first thing HR would do is check to make sure they were declaring cash tips. In 5 years working there I can't remember a single time a server was actually under minimum wage for a pay period, they just weren't declaring cash tips because CC tips usually covered it. I have been out of hospitality for a few years but I am seeing even smaller places with POS systems run on Ipads. I would assume since we live in the future these have similar features to the ancient 'micros' brand POS system we used and could integrate with quickbooks or better accounting software to run payroll and do these calculations. P.S. for any server (or employee anywhere for that matter) who thinks their company is doing something illegal you don't have to even talk to your manager/boss/owner, just call the Department of Labor they pay people to fix these problems for you.
- Jemmeh 10y ago
  That's at a nice restaurant though. It's more common than you think that there are restaurants just using paper tickets. I think Waffle House still does paper checks only and that's a huge chain. And most mom and pop restaurants too. I've waitressed before and when I was a little short of minimum wage several times due to us being a slow/cheap restaurant the management just said "Some weeks you make more some you make less" and didn't try to correct it. I couldn't risk loosing my job. Sure, if they fired me for reporting them they'd be in trouble, but how long would it take for me to get justice and force them to pay? I wouldn't be able to eat while I waited for some kind of justice to be doled out.
  - sharpplanar 10y ago

greedo 10y ago

I'm surprised this is still allowed by the IRS. When I was a waiter back in the 80's in California, we went from self-reporting to turning in our tips. All the tips were pooled, then divvy'd up between waitstaff, busboys, cooks, managers etc. And taxes were taken documented. So our "paycheck" was puny since the withholding was taken from our hourly payrate.

illumin8 10y ago

I've even seen something very shady recently - a nice restaurant that added a mandatory 20% "service fee" to our party of 7, had fine print that said "60% of your service fee goes to your wait staff." The implication is that not only is this restaurant, which we ended up paying ~$80 a person to eat dinner + wine + dessert at, screwing their customers with the mandatory service charge, they're also screwing their employees by keeping 40% of it for the owner. I won't eat there again... Edit: Added visual proof (and name and shame): https://s3-media4.fl.yelpcdn.com/bphoto/t3UUaCU8gl6zPsVQghlvOQ/o.jpg https://s3-media4.fl.yelpcdn.com/bphoto/t3UUaCU8gl6zPsVQghlv... I would be happy to learn that the 40% was going to the cooks. It's still a shady practice, and what makes it worse than not informing your guests ahead of time is that they're doing this in the name of "providing a livable wage for our staff." Pay your staff a livable salary and stop screwing your customers over...

ensignavenger 10y ago
I doubt that the 40% goes to the owner, it probably goes to the kitchen staff.
nommm-nommm 10y ago
Hopefully the hostess and back of the house was tipped out with that 40%. It's also likely that 40% went into the owner's pocket though because that's totally legal! Since it was a non-negotiable service fee the DOL doesn't consider it gratuity (as gratuity is strictly optional) so they don't have to pass it on to their staff. I've seen this happen plenty of times, usually in the catering business, though not to the extent of 40%, usually around 5-10%.
JumpCrisscross 10y ago
> keeping 40% of it for the owner Depending on the city and state, this could be illegal. I'd encourage you to ask the server if the 40% goes to the kitchen or the owner. If the latter, write a letter or make a call to your labour law enforcement group.
- nommm-nommm 10y ago
  It's not illegal. https://www.dol.gov/whd/regs/compliance/whdfs15.pdf https://www.dol.gov/whd/regs/compliance/whdfs15.pdf >A compulsory charge for service, for example, 15 percent of the bill, is not a tip. Such charges are part of the employer's gross receipts. Sums distributed to employees from service charges cannot be counted as tips received, but may be used to satisfy the employer's minimum wage and overtime obligations under the FLSA. If an employee receives tips in addition to the compulsory service charge, those tips may be considered in determining whether the employee is a tipped employee and in the application of the tip credit.
  - JumpCrisscross 10y ago
    Hence my caveat, "depending on the city and state". For example, it's not allowed in California [1]. [1] http://www.tipcompliance.com/polLearningCenter.cfm?doc_id=89 http://www.tipcompliance.com/polLearningCenter.cfm?doc_id=89
jt2190 10y ago
> The implication is that... they're also screwing their employees by keeping 40% of it for the owner... Probably not. In the restaurant I worked at was customary for the waiters to tip the kitchen and support staff. Owners were not tipped.
pcvarmint 10y ago
Others have been willing to backtrack: http://www.seattletimes.com/life/food-drink/seattle-restaurant-mollusk-ends-service-charge-returns-to-tipping/ http://www.seattletimes.com/life/food-drink/seattle-restaura...

sharpplanar 10y ago

I used to do accounting for a restaurant and I would disagree with you and say with the move to modern Point Of Sale software restaurants not doing this would be the exception now. We checked this every pay period to make sure servers were at or over the proper hourly wage because it is illegal to pay them less. Florida based for reference, tips are self reported here too but our POS system would automatically transfer tip amounts when a credit card was the payment method. So our payroll system already has that amount. Then we had an electronic time clock where servers scanned their hand to clock in\out, and it was set to prompt them for declared cash tips. It was a nicer restaurant (avg check a bit over 100$). Occasionally a server wouldn't declare enough tips to hit minimum wage for a pay period and the first thing HR would do is check to make sure they were declaring cash tips. In 5 years working there I can't remember a single time a server was actually under minimum wage for a pay period, they just weren't declaring cash tips because CC tips usually covered it. I have been out of hospitality for a few years but I am seeing even smaller places with POS systems run on Ipads. I would assume since we live in the future these have similar features to the ancient 'micros' brand POS system we used and could integrate with quickbooks or better accounting software to run payroll and do these calculations. P.S. for any server (or employee anywhere for that matter) who thinks their company is doing something illegal you don't have to even talk to your manager/boss/owner, just call the Department of Labor they pay people to fix these problems for you.

Jemmeh 10y ago
That's at a nice restaurant though. It's more common than you think that there are restaurants just using paper tickets. I think Waffle House still does paper checks only and that's a huge chain. And most mom and pop restaurants too. I've waitressed before and when I was a little short of minimum wage several times due to us being a slow/cheap restaurant the management just said "Some weeks you make more some you make less" and didn't try to correct it. I couldn't risk loosing my job. Sure, if they fired me for reporting them they'd be in trouble, but how long would it take for me to get justice and force them to pay? I wouldn't be able to eat while I waited for some kind of justice to be doled out.
- sharpplanar 10y ago