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Thread: Indiana - Tip Sharing Indiana

  1. #1

    Default Indiana - Tip Sharing Indiana

    We were just given paperwork to sign agreeing to share our tips with the bartenders and bus boys. I make 2.13 an hour plus tips. The paperwork they ant us to sign does not state the percentages of what the tips deducted will be. Here's my questions:.. If I have no drinks for my table and the bus boy does not bus my table do I still have to share my tips. Can they legally take whatever percentages out of my days wages for this. Some days I do not even make the federal wages of $7.25 for the day. Doesn't this mean that the company cannot take their credit and has to pay me the next wage which would be $5.15. So confused and angry. Why do I have to pay these people out of my skimpy little money when they do not do anything? Thanks for any replies

  2. #2
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    I am going to include a pointer to the federal tips factsheet. Please read the entire factsheet as many times as it takes to understand what is being said. Everything thing in this factsheet can be considered "black letter law". Meaning rules that everyone associated with the government agrees on. Everyone who works for tips and all employers who have tipped employment should be very familiar with this factsheet.
    http://www.dol.gov/whd/regs/compliance/whdfs15.htm

    The document includes phrases such as "employees cannot be required to contribute a greater percentage of their tips than is customary and reasonable". Gee, what does "customary and reasonable" mean? Just like a strike zone in baseball, it means whatever the umpire says it means. Or in this case, whatever the judge or ALJ du-jour says it means. Meaning if you took exactly the same case with exactly the same facts to 100 different judges/ALJs, but involving something like "customary and reasonable", you would not get the same answer from everyone.
    "Reality is that which, when you stop believing in it, doesn't go away".
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  3. #3
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    I would note that the MW requirement is on a workweek basis, not a daily basis.
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

  4. #4

    Default According to the U.S. Department of Labor the law forbids such an arrangement.

    According to the U.S. Department of Labor, "The law forbids any arrangement between the employer and the tipped employee whereby any part of the tip received becomes the property of the employer. A tip is the sole property of the tipped employee."

    While federal law states,
    Nothing in this section shall be construed to prohibit the pooling of tips among employees who customarily and regularly receive tips, the DOL's statements above clearly indicate that the pooling of tips, as referenced in section 203(m), is a governing of private property, the employee's sole property.

    If your employer is asking that you sign an agreement which allows your employer to govern the tips you receive from customers, then the agreement is one forbidden by federal law according to the Department of Labor. I would contact the U.S. Department of Labor immeditately

    What most people fail to realize is that the pooling of tips is the governing of private property.

    Federal regulations clearly define the pooling of tips as where employees practice tip splitting or where the waiters give a portion of "THEIR" tips to the busboys. If your employer is asking you to sign an agreement stipulating that your employer is going to govern what percentage of your tips are going to be given to the bartenders and busboys then the agreement is stiputlating that your employer will govern your tips.

    How can employees practice tip splitting when their employer is insisting that the employees sign an agreement which stipulates that their employer will be splitting their tips? How can employees give a part of their tips to other workers when their employer is insisting that they agree to let their employer give a portion of their tips to other employees?

    CFR 531.54 goes on to state that tip pooling is where employees mutually agree on the basis by which tips will be redistributed and where such accounting is given to the employer. How can employees who customarily and regularly receive tips "pool tips" when their employer is accounting for how much each employee will receive from the pool?

    According to federal regulations, the tips from a tip pooling agreement are supposed to be redistributed to the employees upon some basis to which they have mutually agreed among themselves.

    Is this a mutual agreement among employees? It sure doesn't sound like you are in a mutual agreement, Opieonekanobiein.

    Doesn't it seem to you that this agreement is making your tips your employer's property?

    The truth of the matter is, when an employer requires that employees pool tips, he is making tips his property. That's why your empoyer's agreement includes no details as to how much he is going to take from you. What the agreement is stating is that your employer will take any amount he wants from your tips. What that means is that the agreement is allowing your employer to take possession of your tips.

    In my state, an open ended agreement concerning deductions from wages, such as the one your employer has written up, is illegal.

    This whole tip pooling issue is one of the biggest scams in America.

    It is my belief that Congress was paid off by the National Restaurant Association to pass a law that would, in effect, give employers an ability to indirectly steal the tips customers are presenting their workers, but as written, would appear to protect those employees who receive tips from the public.

    Currently, our laws provide very little protection for tipped employees and a substantial amount of protection for those employers seeking to benefit themselves to the tips customers present their workers.

    Until Congress can be pressured into clarifying the intent of the laws on tips, employers will continue getting away with business practices which I, and I believe most people would agree, should be prohibited under federal law.

    Federal law states. "Nothing in this section shall be construed to prohibit the pooling of tips among employees who customarily and regularly receive tips."

    Did Congress intend to insure that employees who customarily and regularly receive tips would not be prohibited from pooling, or governing, the tips they receive from the public?

    or,

    Did Congress intend to insure that employers would not be prohibited from governing the tips customers are presenting their workers?

    I believe that if we could get an answer from Congress, they would tell us that their intent was to insure that an employee who is given a tip not prohibitted from governing his tips, however, if they aren't pressured into clarifying such facts, then employers, as planned, will have free reign to govern the customer's tip in ways most financially beneficial to the employer. If pressed on the issue, I do not believe Congress would admit that their true intent was to aid business owners in benefiting themselves to the tips customers present their employees, however, that is currently how our labor laws are being interpretted.

    When employers are errantly allowed to require the pooling of tips, they are allowed to govern the tips customers are presenting their workers. When an employer is errantly allowed to govern the tips customers are presenting his employees, there are countless ways an employer can govern those tips in a way that financially benefits the employer.

    Congress would never admit that they passed a law with the intent to creat a means for businesses to steal the customer's tip. But, that is exactly how our laws are currently being interpretted. An employer can currently seize control of the tips customers are presenting his workers and according to ruling handed down by our justice system, federal laws specifically allow such injustices.

  5. #5
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    Note that this is the ONLY type of post GMoney responds to. He's a one-trick pony and his "opinion" carries NO weight with the wage and hour responders here.
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

  6. #6
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    Thank you, Patty.
    Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

    Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

  7. #7
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    And if he doesn't come out with a new trick instead of repeating his same old rant over and over and over, he's going to get banned again.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

  8. #8

    Default

    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

    The above answer does not assume any such thing. The above answer assumes that a contract cannot require you to break the law. To me it's sounds like Ope's employer wants Ope to sign a contract which, in effect, makes Obe's tips his employer's property.

    The contract refuses to explain how much of Ope's tips are going to taken from him. Does that sound like a legally binding and enforceable contract?

    Like many employer required tip pooling contracts, the employees have very little protection. For instance, here in Nevada a well known Casino had it's dealer pooling tips where all dealers would recieve a share. Suddenly, out of no where, the owner changed the arrangement and decided to add in floor supervisors. It went to court and what the courts said was casinos can change the agreement at any time. Unless you have a union agreement, most employment agreements or contracts carry very little weight. Most states are either right to work states or at will states which means you don't have a legally binding agreement.

    The truth of the matter is, many employers are extorting open ended tip pooling agreements out of their employees. The way it works is, if you don't agree to our tip pool you are either going to get fired or not be hired.

    Most, if not all, required tip pooling agreements are left open ended so that employers can benefit themselves to their worker's tip. In the case of Ope, his employer's contract includes no details of how much of his tips his employer is going to give these other workers. My guess is, the less in hourly wages these other employees will agree to work for, the more tips the employer will give them.

    While everyone should be afforded the right to enter into contracts. some contracts are not good for society. You should only have constitutional rights when exercising those rights doesn't harm others.

  9. #9
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    That is a signature line, which appears on all my posts, and was not directed at you personally.

    We are all here very well aware of your thoughts on the matter. No one here is in a position to change the law or to force the elimination of tip pooling. Contact your elected representatives - we are bored with hearing it.

    The next post I see from you on the subject will earn you another time out.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

  10. #10
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    Quote Originally Posted by Pattymd View Post
    Note that this is the ONLY type of post GMoney responds to. He's a one-trick pony and his "opinion" carries NO weight with the wage and hour responders here.
    Agreed, although more importantly FLSA is an old law (1930s) with many decades of court decisions behind. Some random poster not liking the law is sort of a "who cares" because the administrative and courts consider all of this to be very settled law. The parts of the "law" that have uncertainty are things like the "customary and reasonable" language. That basically means whatever the courts say it means and courts do not agree. More importantly, it means industry specific variations and variations in state law/regulation/decisions. Meaning that if we have a Very Big Restaurant Chain, "customary and reasonable" do not necessarily mean the same thing in different states. Fun times.

    GMoney is beating a very dead horse. His arguments have already had their day in court, and lost big time.

    Anyone wants a real answer, start with the cited federal DOL factsheet. The federal and state DOLs and all courts agree with what is in that factsheet.
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

  11. #11

    Default This topic deserves discussion

    Cbg, with all due respect, all I want is to discuss a topic that needs discussed.

    I don't know why we can't discuss this issue like adults and without me having to worry about getting kicked off the board.

    For instance,

    DAW seems to be under the impression that "Everything in the Department of Labor's factsheet can be considered "black letter law". Meaning rules that everyone associated with the government agrees on."

    Likewise, DAW seems to be under the impression that the administrative and courts consider all of this to be very settled law. The parts of the "law" that have uncertainty are things like the "customary and reasonable" language.

    Now here is why I want to discuss this issue.

    The courts have rejected several things in the DOL's factsheet. In the Outback case, the 6th Circuit ruled that the Department of Labor's opinion which suggested that contributions to a tip pool are limited to customary and reasonable, had no statutory support and as such should be given no deference.

    In the Cumbie case, the 9th circuit ruled that limiting required tip pools to employees who customarily and regularly participate in a tip pool only applied when an employer was taking a tip credit, which went against the long held opinions of the Department of Labor.

    Several other Circuit courts have interpretted these same issue in a different light. My point is, there is nothing settled about the issue of tip pools. The issue is quite contraversal. Clearly the DOL's factsheet is not "BLACK LETTER LAW. In several states, such as Minnesota, Kentucky and several others, employers are prohibited from requiring any amount to be contributed to a tip pool. How can you say it's settled when many states totally disagree?

    While DAW suggests that one of the only things that is not settled is what does "customary and reasonable" mean, the truth of the matter is, neither federal laws nor federal regulations state anything about tip pool contribution being limited to customarily and reasonable.

    The reason, I believe contributions to a tip pool are not addressed under federal laws and regulations is because, those writing the law expected those interpretting the law to understand that it was up to the employee who was given tips to determine what amount he would give to a tip pool. Customers are giving their tip to the employee. Only the employee should be deciding how much of his tips he is going to contribute to a tip pool.

    The parts of the "law" that have uncertainty are NOT things like the "customary and reasonable" language. There is no such language found in any of our federal labor laws or regulations. The parts of the law that have uncertainty are things like tip pooling being something employers can legally require.

    Now can we continue discussing this issue like adults or am I banned for expecting some mature discussion on this issue.

  12. #12
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    The reason, I believe contributions to a tip pool are not addressed under federal laws and regulations is because, those writing the law expected those interpretting the law to understand that it was up to the employee who was given tips to determine what amount he would give to a tip pool. Customers are giving their tip to the employee. Only the employee should be deciding how much of his tips he is going to contribute to a tip pool.
    Do you have a citation on your assumption?

  13. #13
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    Here's the problem.

    You have discussed this to death. This is your issue, not anyone else's and the rest of us are bored sick of the topic. There frankly is simply not any interest in the matter on the part of anyone but you. In order for you to discuss it, someone else has to be willing to discuss it with you. And based on the responses both here and in my in-box, no one is. Therefore your continuing to demand that we discuss it with you anyway, and over and over again, serves no purpose but to annoy people. And I don't want my volunteers annoyed.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

  14. #14

    Default Response to GotSmart

    Yes, I do have a citation which backs up my assumption.

    CFR 531.52 explains that "Only tips received as money belonging to an employee which he may use as he chooses free of any control of the employer are to be counted in determining whether the employee is a "tipped employee" and in applying the provisions of section 203(m)".

    The provions of section 203(m) state first that all tips received by the employee are to be "retained" by the employee and then go on to state that nothing in this section shall be construed to prohibit the pooling of tips among employees who customarily and regularly receive tips.

    Likewise, "the pooling of tips" is defined under CFR 531.54 as where employees practice tip splitting, or where employees give an accounting of their tips to their employer for his imformation only or in furtherance of a tip pool, whereby tips are redistributed to the employee upon some basis which they have mutually agreed among themselves.

    It seems to me that CFR 531.52, along with CFR 531.54, contradict and disprove any misconceptions that the "pooling of tips", as refered to in section 203(m), is something federal laws cannot be construed to prohibit employers from requiring.

    The point I am trying to make is, while many people have interpretted section 203(m) as attempting to insure that employers will not be prohibitted from requiring tip pooling among employees who customarily and regularly receive tips, tip pooling is clearly defined under federal regulations as a something employees practice, not employers.

    CFR 531.53 states that tip pooling is where the waiters give a portion of their tips to the busboy. If employers are errantly allowed to require that the waiters give part of their tips to the busboy, then the waiters are unable to "retain" possiession of or the use of their tips. Likewise, the busboys receiving tips from an employer required tip pool would not be receiving tips "free of any control of the employer", which is a requirement clearly spelled out in CFR 531.54.

    In other words, if an employer where to require his waiters to give a portion of their tips to the busboy, the busboys could not be counted as tipped employees, or employees who customarily and regularly receive tips due to the fact that CFR 531.52 states that only tips received "free of any control of the employer" can be used in determining whether the employee is a "tipped employee" and in applying the provisions of section 203(m).

    Why lawyers have never brought up these facts in court is a mystery to me. Several judges have utilized these same regulations to support rulings that favor employers in disputes concerning tip pools. The problem is, many of the judges who have utilized CFR regulations to support rulings which suggest that federal laws do not prohibit an employer from requiring tip pools totally ignore parts of the same regulations which contradict the idea that employers aren't prohibitted from requiring tip pools.

    One other citation that I believe is quite pertinent and yet never seems to be addressed is CFR 531.52 language which explains that a tip is a sum presented by the customer. While Ninth Circuit, in Cumbie, utilized a part of CFR 531.52 which explains that an agreement between the recipient of a customer's tips and a third party result in tips not belonging to the employee in recognition of whose service it was presented by the customer, the Ninth Circuit totally ignored a part of CFR 531.52 which states that a tip is a sum presented by a custom. Whether a tip is given and it's amount are matters determined solely by the customer.

    Here is what the Ninth Circuit ruled, and this is a direct quote from the audio file from the Cumbie v. Woody Woo case.

    Judge stated,
    "Tips presumptively belong to the server unless there is a contract between the employees and the employer", Judge then states "which we have here".

    The Judge then goes on to state,
    It's seems to me that tips are the property of the employee in some instances but in other instances, where we have an employment agreement suggesting that tips become the property of the employer, now tips are not the property of the employees at all, and now we have an agreement that says they are not the property of the employee.

    Do you really think there was an agreement stipulating that tips become the property of the employer? I heard of no contract being produced in court as evidence. In fact the plaintiff was in court to dispute the idea that her tips belonged to her employer.

    But to get back to the issue at hand, the point I am making is, it must be reasonable to rely on the language of federal regulations if judges can use citations from federal regulations to support their ruling.

    The language of CFR 531.52 contradicts the Ninth Circuit's ruling which suggested, and I quote, “The FLSA does not restrict tip pooling when no tip credit is taken. Therefore, only the tips redistributed to Cumbie from the pool ever belonged to her,” contrary to the Secretary’s interpretation.

    The Ninth Circuit's ruling which suggested that "only the tips redistributed to Cumbie from the pool ever belonged to her" are totally condradicted by the language of CFR 531.52. While CFR 531.52 clearly states that whether a tip is given is a matter determined soley by the customer, the Ninth Circuit, to the contrary, suggested that it is the employer's sole right to determine whether a tip is given.

    Please note that CFR 531.52 does not state that only when a tip credit is taken would it be the sole right of the customer to determine whether a tip was given. The regulation does not support the Ninth Circuit's suggestion that it is the right of an employer to determine whether a tip is given. Likewise, while CFR 531.52 states clearly that whether a tip is given and it's amount are matters determine solely by the customer, the Ninth Circuit totally ignore the plain language of the regulation and instead suggested that it is the right of the employer to determine what amount of the customer's tip would belong to the employee.

    Another issue I would like to discuss is, how can it be said that federal laws do not prohibit employers from requiring tip pooling when the truth of the matter is, tip pooling is defined as where "employees give an accounting of their tips to their employer. When employers are allowed to required tip pooling, employers are the ones given an accounting of the tips to their employees. When employers require tip pooling the employees are unable to give an accounting of their tips to their employer. Instead, an employer who requires tip pooling determines both who will receive tips and what amount each will receive. Isn't that an accounting?

    The truth of the matter is, "the pooling of tips" which federal laws expain section 203(m) shall not be construed to prohibit is a governing of private property, the customer's tip. When tips are pooled the customer's tip is governed. Only one authorized to govern the customer's tip should be governing such private property. Do you really think customers are authorizing employers to govern their private property in a manner tip pooling would govern such property?

    The issue which must eventually be addressed is, who are federal laws stating cannot be prohibitted from governing the customer's tip. The question I have for you is, shouldn't the customer be deciding who should goven his private property. The only way to insure that the customer is able to decide who will govern his property is to prohibit employers from governing the customer's property. When employers require tip pooling, they are governing the tips customers present. They are deciding that the tips will be used for a tip pool governed soley by the employer.

    I would also like to add that while many have argued that the Department of Labor has strict guidelines on who employers may include in their tip pool, and as such employers are not actually deciding such issues, there are a couple problems with such assumptions.

    First off. By suggesting that the Department of Labor has guidelines defining who can be included in a tip pool, it is being errantly assumed that the Department of Labor, rather than the customer, has a right to determine who the customer's tip belongs to. Likewise, such a suggestion errantly assumes that whether a tip is given, say a hostess, is a matter determined by the Department of Labor, rather than the customer. Again I must reiterate the clear and concise language of CFR 531.52. Whether a tip is given and it's amount are matters determine by the customer, not the employer, not the Department of Labor.

    Clearly CFR 531.52 substantiates the fact that the Department of Labor would have no authority to comprise a list of types of employees employers may include in their required tip pool. CFR 531.52 makes it explicitely clear that it is the right of the customer to determine who the recipient of his tip will be except in the case where there is a "mutual" agreement between the recipient and a third party. CFR 531.54 supports a conclusion that the ageement mentioned in CFR 531.52 is supposed to be a mutual agreement. Likewise, CFR 531.52 supports the idea that such agreement are supposed to be freely entered into by clarifying that the pooling of tips is to be among employees, each of whom is receiving tips as money belonging to him which he may "use as he chooses, free of any control of the employer".

    Thank you GotSmart for giving me a chance to bring up some very pertinent information concerning the topic of tip pooling. I hope other will read this thread and learn something they didn't know about tip pools and what they actually are.

    To sum up what a tip pool actually is, tip pooling is the right of someone who has been given a tip to govern the tips he has been given which would include but would not require that the tips to be pooled with other employees.

    What federal laws are stating is that nothing in this section shall be construe to prohibit an employee who customarily and regularly receives tips from governing his tips which would include pooling them with other employees. The reason such clarifications were added to section 203(m) was to insure that the previous sentance which states that all tips receive by the employee are to be "retained" by the employee would not be misconstrued to where an employee who customarily and regularly receives tips would not be able to share or pool his tips with other employees.

    You see, the word "retain" is defined as, to keep in one's possession or for ones use. Section 203(m) include instructions explaining that the law should not be construed as prohibiting an employee from sharing or pooling his tips with other workers, as would be the case if the word "retain" was interpretted as to keep in one's possession. If an employee was errantly required to keep all his tips in his possession, then the employee would be unable to share or pool his tips with other employees.

    The reason I am so sure about this interpretation is, there is no other language contained in section 203(m) which could be construed in a manner where the "pooling of tips", as defined under CFR 531.54, might be prohiibted. If you can come up with some other language section 203(m) might have been concerned might be misconstrued to prohibit the pooling of tips among employees who customarily and regularly receive tips, I would love to here your take on this federal law.

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