California laws about tipping

On behalf of Sullivan Law Group APC posted in Wage & hour laws on Wednesday, March 28, 2018.

The laws on tipping vary from one state to the next. Fortunately, California has relatively strict laws on how employers treat tips in relation to their employees’ wages. For example, California law states employers cannot pay workers less than minimum wage, expecting tips to make up the difference. While that is a common practice in other states, it has gone away here.

If you work in the service industry and receive tips, then it is important to be aware if your boss breaks the law. You may want to bring it to the employer’s attention to try to rectify the situation on your own. If that does not work, then you may need to pursue other legal recourses.

Basic laws regarding tipping

An employee has a right to any tips earned during a shift. The boss has zero entitlement to these tips. While other states allow bosses to use tip credits, California employers must pay workers at least minimum wage with tips on top of that. 

Laws regarding tip pooling

Employers can take tips from all employees on a given shift, pool them together and redistribute. However, this practice needs to follow a strict set of guidelines. For starters, only employees whose jobs earn them tips may be part of the pool. Therefore, waiters, hosts and bussers may pool together tips. An employer cannot give some of the money to the cooks and dishwashers. Additionally, the employer must give out the tips in a fair and reasonable manner. 

Laws about service charges

Many restaurants charge certain parties extra. A common example is if a group of at least eight people dine at a restaurant, then they will have to pay an 18 percent service charge. In the eyes of the law, this is not a tip. Although it is a common misconception it is a tip, the employer does not have to give it to the employee. Some bosses do, but there is no requirement by law.