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Tips can't be pooled in California

In some states, business owners will pool tips and then divide them evenly at the end of a shift. For example, if there were ten people working during the shift and the patrons left a total of $800 in tips, each employee would be given $80.

The problem with this system is that employees may not get what they consider to be their fair share. If one employee worked very hard and did an excellent job, bringing in $300 in tips, he or she would feel ripped off when only being given $80. This is especially true if another employee did not do a good job and brought in just $20 in tips, but then he or she was still given the same $80.

To address this problem, the practice of pooling tips has been made illegal in California. This was done in Labor Code Section 351. Tips are only to be given to the employee who earned them, as they become that employee's property immediately upon being left.

Furthermore, business owners are not allowed to take tips or request that a portion of the tip goes to the company. Again, they belong only to the employee.

Finally, employers cannot get around this issue by deducting tips from an employee's wages. This would circumvent the rule about not taking the tips, as the employer would then just be taking the employee's wages. The employee must be paid the standard wage and then be given the tips on top of it.

If you think that your employer is treating you unfairly when it comes to tips, perhaps breaking these laws, you need to know your legal options.

Source:, "Tips and gratuities," accessed March 09, 2016

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