Surly isn`t the first Minnesota restaurateur to fall victim to the state`s complex tip pooling laws. Previous decisions have been rendered against Outback, Starbucks and Pinstripes. The law is complex and difficult to comply with. Minnesota restaurateurs should consider reviewing their policies and practices in consultation with legal counsel to ensure compliance and take corrective action if necessary. Minnesota restaurateurs face a unique state tip law that makes it very difficult to ensure tips can be pooled and split between servers and non-servers (reducing labor costs for non-active employees). The problem came to a head last week in a case against Surly Brewing Company, when a judge in the Hennepin County District Court ruled that Surly`s tipping policy violated Minnesota`s tip pooling laws. A hearing has now been set to determine damages for a class of more than 100 waiters and bartenders. The potential damage is likely to be substantial. What makes Minnesota`s tip pooling rules so unique? Under federal and most state law, a restaurant can require tipping among employees as long as those who are required to participate in the “customary and regular” pool receive tips.
Basically, only employees who normally receive tips can participate in the pool. Since the dishwasher does not receive advice on the cleanliness of the plates, waiters cannot be forced to pack their tips on them. Under federal law, employees who receive tips “habitually and regularly” can include hosts, bartenders, bus drivers (and, of course, waiters). Retaliation against employees who refuse to participate in the pooling and sharing of tips. It is still illegal for Minnesota employers to retaliate against employees who exercise rights under the MFLSA, including the right to keep their tips. Participation in tip pooling and sharing programs. It is generally illegal for Minnesota employers to participate in tip pooling and sharing schemes or to force employees to participate in tip pooling and sharing schemes. In almost all cases, an employee`s decision to share tips must be entirely voluntary and free from employer intervention or coercion. Minnesota`s law is very different. Whether a restaurant can require employees to participate in a tip pool does not depend on who receives tips “habitually and regularly,” but rather on a distinction between “direct service” employees, who may be required to participate, and “indirect service” employees, who cannot. The control regulations define a direct service employee without assistance as “someone who provides direct services to a client in a particular situation.” An indirect service employee “is a person who assists a direct service representative,” including “bus people, divers, cooks or hosts.” So, unlike federal law, servers can`t be forced to share tips with buses and hosts that only support servers but don`t provide sufficient direct service themselves. Tips are the property of the employee who serves the customer directly.
Employers cannot require their employees to share or bundle tips with other employees, except in certain situations of limited service. Originally published on the St. Paul Area Chambers of Commerce blog. State regulations are updated quarterly; We currently have two versions available. Below is a comparison between our latest version and the previous quarterly version. More comparison features will be added as we have more versions to compare. Take a piece of advice. It is still illegal for Minnesota employers to count tips in their minimum wage obligations, a practice known as “tip credit.” Employers cannot avoid their minimum wage obligations by accepting tips from the employee who received the tip. Under the MFSA, employers must pay their employees minimum wage, as well as any tips the employee earns in addition to minimum wage. Our customers worked in a restaurant that required its waiters and bartenders, including our customers, to “give” 20% of their earned tips to indirect service providers such as bus drivers and cooks. In other words, the restaurant passed on the cost of paying a living wage to kitchen staff to waiters and bartenders.
We have developed a sub-emphasis on tipping and tipping rights. For purposes of Minnesota Bylaws, Section 177.23, Subsection 9, mandatory fees that may reasonably be construed by the guest, customer, or customer as an amount to be given to an employee in payment for personal services rendered include, but are not limited to, service charges, tips, tips, and/or surcharges included in the statement of fees to the client. Unpaid wages? Wage theft is illegal. Minimum rates of pay apply to all hours worked, whether full-time or part-time. Employers cannot credit tips for minimum wage payments. You will find a fact sheet here. Employers, managers and supervisors cannot be part of a tip pool. The Ministry of Labour recently clarified tipping rules for managers and supervisors.
If managers or supervisors receive tips from clients for services that these employees provide directly and exclusively, they may withhold those tips. Managers and supervisors can also contribute to a tip pool. However, you may not receive tips from the tip pool. Pooling tips, sharing tips and spills. It`s generally illegal for Minnesota employers to require service employees to pool tips for redistribution, share tips with other employees, or “spend” indirect service workers such as kitchen staff, runners, and bus drivers. Gratuities presented to a Direct Service employee using a fee or credit card will be credited to the payment period in which they are received by the Direct Service employee and for which they appear on the Direct Service representative`s tip statement. Many of our current and former clients work in the service industry, including waiters, waiters, bartenders, delivery people, hairdressers, stylists, massage therapists and beauticians – and rely on the tips they earn to earn a living wage. For purposes of Minnesota Bylaws, Section 177.23, Subdivision 9, a clear and conspicuous notice that the mandatory fee is not a tip is a notice clearly printed, stamped or bolded on the menu, poster, front of the expense statement or other printed materials given to the customer. A font of at least 18 points (one quarter inch) on the poster or 9 points (one eighth of an inch) or more on all other notices is clear and visible. If a tip is given by a customer using a credit or debit card, the direct service agent must receive the full amount of the tip, less the percentage deducted from the tip, in the same proportion as the percentage deducted from the total bill by the service provider. If more than one direct service representative directly serves a customer or customers in a particular situation, such as banquets, cocktails and combinations of food services, or other combinations, the money presented by customers, guests or guests as tips and divided among direct service agents does not constitute a violation of the Minnesota Constitution. Section 177.24, Subdivision 3.
At the request of workers, security benefits distributed in accordance with a bona fide agreement to pool wages. Posted on July 24, 2017 in Top Stories, Legal Insights with Tags Joel O`Malley, Minnesota Tip-Pooling, Employment Law Tip Pooling In Minnesota, tips and gratuities are the exclusive property of the employee who received the tip, a right guaranteed by the Minnesota Fair Labor Standards Act (“MFLSA”). report the amount of gratuities received for withholding purposes; and Most forms of mandatory tip exchange are against Minnesota law. A “direct service representative” is a person who provides direct service to a customer in a particular situation and who should be considered a tipped employee. An indirect service employee is a person who assists a direct service employee, including bus people, divers, cooks or hosts. Pooling or sharing advice may not be a condition of employment. An indirect service employee who provides services because the recipient shares the tip with him or her does not receive the remuneration when calculating his or her salary. But while mandatory tip pooling in Minnesota is only allowed for direct service staff, anyone, including waiters, bus drivers, hosts, etc., can join the pool if the pool is truly voluntary and without involvement from restaurant management.
The challenge, however, is that a restaurant is able to legally promote pools that are voluntary enough to meet this requirement. The court`s decision was not due to Surly`s lack of attempt to comply. In fact, Surly has twice revised its policies and practices in an attempt to make the agreement more voluntary. Surly`s efforts concluded that Surly`s efforts were just further evidence of the employer`s involvement in the pool.
