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Question about tips and gratuity

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  • Question about tips and gratuity

    My husband works as an independent contractor for a catering company. His contract does not specify anything about tip money or gratuities. Following an event he received a large cash tip from the host of the event. When the company found out about it (two days later), they decided to deduct the tip money that he had earned from his contracted wages, saying he had to turn over the tip or he wouldn't keep his job. And they gave out a tip policy three days after the event that requires everyone to turn over all tip money to the company. Can they do this under Texas law? Or can we go to small claims court to get the tip money back? Please advise.

  • #2
    If your husband is an independent contractor then he is not an employee and any laws in your State regarding gratuities don't apply. If his contract with the catering company doesn't specify anything regarding tips, then the company that is leasing his services is free to do as they please without violating the contract. The only option your husband has is to file suit in small claims court and see what a judge thinks.


    • #3
      In talking with the Texas Workforce Commission, they said he may or may not actually be an independent contractor (since he is required to work 40 hours a week and the employer has control over how he performs his job.) Should we file something with the wage claim division where they will determine if he is an employee or not? And does federal law say anything about tips and gratuity?


      • #4
        If it is determined that your husband is an employee, then he has many more options available to him. You can file with the TWC and they will make a determination. Cash tips and gratuities to employees must not pass through the hands of the employer, except if tip pooling is required. Service charges are different; they are paid by the customer as part of the bill and are distributed by the employer.
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