When servers at a restaurant or stylists at a salon earn tips, they sometimes agree to combine their tips in a pool and share them equally. Tip pooling is common in the service industry. But can an employer require workers to combine their tips in a tip pool, even if a worker does not wish to do so?
Tip pooling in Pennsylvania
Under federal law, employers can make tip pooling mandatory in the workplace. However, under Pennsylvania law, there are limits on who can participate in a tip pool and who can get a share of these tips.
Some tipped workers are paid the tip credited minimum wage. This means their hourly wages are less than the minimum wage of $7.25 per hour, but employers must make up the difference if the worker does not make enough in tips to meet the state’s minimum wage.
If a worker is paid the tip credited minimum wage and is participating in a workplace tip pool, only other workers who work in a position where tipping is a customary and regular practice can also participate in the tip pool.
If a worker is paid the regular minimum wage of $7.25 or more per hour and is participating in a tip pool, other tipped workers as well as some non-tipped workers can also participate in the same tip pool.
What about managers?
In general, managers and supervisors cannot receive a share of the tips in a tip pool, even if they contributed tips to the pool. Managers and supervisors are only permitted to accept and keep tips for themselves if they performed the entire service for a patron without the help of any other worker, tipped or not.
So, tip pooling can be made mandatory, but not everyone is allowed to participate in the pool or receive a share of the pool. Under federal law and Pennsylvania law, tips belong to employees, not employers. Violations of tip pooling laws may result in a wage and hour claim.