Location: Virginia
I work at a small business with two locations (about 20 employees total). We receive customer tips (both in cash and on credit card transactions), but none of the employees ever actually receive them.
When asked, the manager at one location says the tips “go back into the company.” A coworker spoke with a manager at the other location, and she said that the last time she asked, the owner claimed the tips are saved up and used to fund our Christmas bonuses. Last year, each of us got $100.
That $100 was nowhere near what any of us should have received if all the tips from the year were actually being pooled and redistributed. We have no written policy, no transparency, and we’re not part of a tip pool or service charge system. We also have no way of knowing how much is being collected from customers on our behalf.
When my coworker texted our HR person asking about how tips were distributed, she was left on read.
From what I’ve read, under federal law (and maybe state law too), tips are supposed to belong to the employees who earn them- not the company.
My questions:
• Is it legal for the business to withhold 100% of our tips and reroute them into company funds or bonuses?
• What are my rights under federal and Virginia law?
• Would I be protected from retaliation if I filed a complaint?
Thanks in advance for any advice.
Comments
Not a lawyer but this is illegal under federal law. Here’s a link with relevant resources. But you should file a report with your states labor department.
So damned illegal. You are being robbed.
Stealing from employees is illegal
You should contact your state’s labor board.
i agree with the other posters – this is both a legal and a dol issue.
one thing i might add is to try and get as accurate tip total as you can over a period of time — when the feces hits the fan, you can bet the thief is going to claim it was only a few dollars, less than bonuses and it would be good if you had documentation to prove he’s lying
btw – how the hell is giving you your own money back a bonus?
I’d call the attorney general’s office in your state and ask that question.
I would do everything below and also inform customers that you don’t get the tips.
He’s probably avoiding paying taxes too. I’d file a complaint with the department of labor in your state. Keep working. They’ll investigate.
I’d like to be there to watch him try and explain his tip scheme
It’s surprising (or maybe it isn’t) how many small employers think they can just make this sort of thing up. It’s not like there are literally volumes of labor law and regulations. Pretty much any idea you’re going to come up with is going to be addressed in some way.
Ask your coworkers to also contact your state’s labor board.
This is when you all agree to tell all your customers to not bother tipping because the manager keeps them.
Wow.
I’ll just say…I would hate to be on the receiving end of the shit storm that is coming…
Your boss is keeping the tips. Illegal AF.
I’m the boss and reading this shit makes me so upset, the level of greed and lack of consideration is off the chart.