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Should owners pocket tips when serving tables?

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Question:

My wife and I own a restaurant in Miami. It is a small restaurant, so generally there are one or two of us waiting tables. Some days when we are busier, we have a busser helping. Basically, we are getting the tips. I read some comments on the internet saying owners and managers can’t get tips. So, how would that work?

– Marcelo Garrahan, Owner, Loui, Coral Gables, Fla.

Answer:

In this column, we have previously addressed whether managers and owners can have a share of an employee tip pool, even if they participate in serving guests. The answer is emphatically no, under the federal Fair Labor Standards Act. That act works to make sure that tips that employees earn stay with the employees.

In this case, however, you are not pooling tips with other employees, but rather being tipped directly when serving guests. Our legal friends at Avvo confirm that “Owners and managers may never take part in a tip pool. An owner or manager may, however, accept direct tips that they earn from serving customers. This is relevant in the case of a small restaurant, where an owner might also provide table service.”

As a matter of day-to-day practice, in a scenario where an owner picks up a table or two during a rush to help out some tipped servers, my advice would be for that owner not to pocket the tips, even in a nonpooled environment. Doing so will frustrate and demoralize your employees and change your role from a helpful presence to an income-cutting competitor. But where you have no other tipped servers, and provided your busser is taking home full minimum wage or higher, you should not have a problem. You should, of course, be declaring the tips for tax purposes.

As always, state or local regulations may be stricter than federal guidelines. Always consult with your restaurant association and attorney.

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