Minimum Wage Law Compliance

[system]

Here is a good article about how NOT to use tip credit to save on labor costs:

Servers and Bartenders Underpaid–Pooled Tips Partially to Blame

http://tacoma.injuryboard.com/miscellan … eid=252344

November 30, 2008 - 11:05 AM

We are seeing more and more cases involving unpaid wages. Along those lines an interesting case out of Texas called Bernal v. Vankar Enterprises, Inc.

Mr. Bernal worked at a series of Texas bars. Tips from customers that were placed in a tip pool and distributed among all employees including managers. Mr. Bernal’s base hourly rate of pay was less than federal minimum wage, and did not receive time and a half pay for overtime.

Mr. Bernal instituted a class action. He alleged violations of the Fair Labor Standards Act (“FLSA”). The FLSA establishes a minimum hourly wage and overtime requirements.

However, some employers are permitted to pay employees less than the minimum wage if the employees receives tips that, when added to their hourly wage, amount to more than the statutory minimum. This practice, known as taking a “tip credit,†is only permitted if the employer has informed the employees of the tip credit provisions and if the employees retain all tips.

The Court held:

1. The Bars violated their minimum wage obligations by failing to inform employees of the tip credit provisions, by requiring employees to cover cash register shortages and unpaid tabs, and by requiring employees to participate in tip pools which distributed tips to managers and janitors.
2. The Bars violated the FLSA by failing to pay appropriate overtime wages.

The economy’s tough. You work hard. If you are not getting paid what you deserve, you should contact an attorney to review both your situation and your employer’s practices.

Here is what the DOL says about tip pooling:

http://www.dol.gov/esa/whd/regs/compliance/whdfs15.pdf

Tip Pooling: The requirement that an employee must retain all tips does not preclude a valid tip pooling or sharing arrangement among employees who customarily and regularly receive tips, such as waiters, waitresses, bellhops, counter personnel (who serve customers), busboys/girls and service bartenders. Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements, such as dishwashers, cooks, chefs, and janitors. Only those tips that are in excess of tips used for the tip credit may be taken for a pool. Tipped employees cannot be required to contribute a greater percentage of their tips than is customary and reasonable.

Learn more about minimum wage laws here:

http://www.dol.gov/esa/whd/flsa/

 

[Crusher]

Gregster,
No one cares. Move on.

 

[system]

Crusher:

Gregster,
No one cares. Move on.

Do you speak for everyone here? If they don’t care, they may simply ignore the information and move along. If you believe anything I have posted is incorrect, feel free to direct me to the correct facts and I will be happy to change the post accordingly.

Until then, thanks for bumping my thread that "no one cares’ about.

 

[bodegahwy]

I will post this one time.

Gregster, we do care about the issue. On the other hand, I am 100% certain that I am in compliance with minimum wage, overtime, work comp, etc etc which makes it a less than interesting topic.

No doubt there are others on this board who are not in compliance, but I would be willing to bet that more than 90% are not breaking the law and that these operators make up the group that participates in the discussion.

I appreciate that your posts in the last couple of days are not directed at individuals or the group at large implying that they are dishonest or otherwise breaking the law… but isn’t there ANYTHING else you care about?

 

[papajoe]

Good information. Our drivers don’t pool tips, so were OK there, like most operators on here. Anything else?

 

[Registered_Guest]

We don’t pool tip either.

However, what think you of this scenario Gregster?

Three or four times per week we have a large catering order go out to an office or car dealership. This is usually 100+ pizzas, or a combination of 100+ different items including pizza, subs and salads. Generally, 2 cooks are required to come in up to 2 hours before their normally scheduled time and bust their butts getting this order prepared, cooked and boxed.

The driver comes in 15 minutes before the order is due, loads it in his car and drives it there. The customer(s) normally give a $50-$100 tip.

I’ve always thought it more than fair to split the tip amongst all the people directly involved in the order. Some drivers don’t see it this way.

 

[royster13]

My guess would be most of the folks that frequent ThinkTank know the rules…So if you are trying to enlighten an already enlightened group you are probably not going to accomplish much…

 

[Wizzle_Wassell]

grester.

I can help you here and save you lots of time posting about min wage.

Guys - if any of you have any queries about compliance with minimum wage legislation, please refer to the Dept of Labor site: http://www.dol.gov

Ok - all done - you don;t need to keep posting about this subject again - thanks!

 

[Charles]

I know that he is trolling and “the best policy” is just to ignore him. However, I think he will continue to crap on our forum with his agenda posts. IMO, it is time for the mods to contact gregster and ask him to knock it off. It is no different then if someone else coming in here and constantly berated us for not recycling enough.

 

[Daddio]

Dewar's Pizza Bakery:

I know that he is trolling and “the best policy” is just to ignore him. However, I think he will continue to crap on our forum with his agenda posts. IMO, it is time for the mods to contact gregster and ask him to knock it off. It is no different then if someone else coming in here and constantly berated us for not recycling enough.

PM sent.

 

[system]

Registered Guest:

We don’t pool tip either.

However, what think you of this scenario Gregster?

Three or four times per week we have a large catering order go out to an office or car dealership. This is usually 100+ pizzas, or a combination of 100+ different items including pizza, subs and salads. Generally, 2 cooks are required to come in up to 2 hours before their normally scheduled time and bust their butts getting this order prepared, cooked and boxed.

The driver comes in 15 minutes before the order is due, loads it in his car and drives it there. The customer(s) normally give a $50-$100 tip.

I’ve always thought it more than fair to split the tip amongst all the people directly involved in the order. Some drivers don’t see it this way.

Unfortunately that is against the law:

“Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements, such as dishwashers, cooks, chefs, and janitors.”

 

[system]

papajoe:

Good information. Our drivers don’t pool tips, so were OK there, like most operators on here. Anything else?

Some operators here do pool tips:

marbles2:

The more I read these posts and the ones on the other thread, the more I’m confident that I’m doing the best system. We provide the delivery car, fully owned, maintained and insured by the business. Drivers have to have an almost perfect driving record (I barely qualify!) and need to work for us for a while before they earn our trust. (Needless to say, right now I’m the delivery person most evenings and hubby works the shift on weekends.) I have one employee who is a good hard worker but in his own car and life has a few driving incidents so I cut off his delivery privileges. We’re in a state without tip credits so I don’t even know how that works. (Minimum wage here is like $8.25!!) Any tips are added to the employees’ pool since everyone works at serving the customers. In between delivering, the delivery person helps out in the restaurant.

I think since the image of my restaurant is largely focused on my car (a wrapped Scion xB), I would hate to hire people with jalopies to drive around. There is just too much risk on so many fronts, I think it would be better to not deliver if I didn’t have all the pieces in place.

Dewar's Pizza Bakery:

Hate to bring this up for fear of ridicule. But we will are opening with our own vehicles, three to start. Drivers will earn straight wages like anyone else. Tips will be shared by the entire crew. Yeah, yeah. I know you don’t trust your employees to share.

thepassionofthecrust:

Also…on a side note. We have a tip jar that every one participates in ($ divided up by hours worked).

Everyone is in the pool accept for me and my partner and the drivers.

 

[paul7979]

Good job digging through OLD posts to try to prove your point. When was the last time thepassionofthecrust posted here? You dig up a post from charles that if I recall was posted ages ago and was a theoretical business model that he wanted to try. This was LONG before he opened his restaurant. On top of that, both Marbles and Charles specifically stated they do not rely on a tip credit to increase wages to above minimum wage. This is why everyone on this board is sick of you and the half truths you try to present.

 

[system]

paul7979:

Good job digging through OLD posts to try to prove your point. When was the last time thepassionofthecrust posted here? You dig up a post from charles that if I recall was posted ages ago and was a theoretical business model that he wanted to try. This was LONG before he opened his restaurant. On top of that, both Marbles and Charles specifically stated they do not rely on a tip credit to increase wages to above minimum wage. This is why everyone on this board is sick of you and the half truths you try to present.

The rules for who may share in tip pooling apply whether or not tip credit is used.

Please quote something I have posted that is only “half true”.

 

[Charles]

gregster:

Some operators here do pool tips:
Dewar's Pizza Bakery:

Hate to bring this up for fear of ridicule. But we will are opening with our own vehicles, three to start. Drivers will earn straight wages like anyone else. Tips will be shared by the entire crew. Yeah, yeah. I know you don’t trust your employees to share.

You took that out of context. Our drivers will not be “tipped” employees. They earn at least minimum wage and use our cars. If they use their cars, we will compensate them for the use of their vehicle based on mileage.

All tips will be shared by the entire hourly crew.

We are hesitant to ban anyone from the TT. I welcome a driver’s experiences here. But when someone has only the intention of stirring the pot, then I think it is time for him to go. I believe he has been asked nicely to drop the agenda already. Mods, please consider this my vote for giving gregster a vacation.

 

[roanoke_49]

I don’t post a lot, but I read just about everything that’s posted. I sometimes have a short fuse to my temper when someone continually challenges everyone else’s comments in a thread. My family was in the restaurant business 43 years ago and I’ve dabbled in it off and on since then. My husband and I have had a BBQ place which didn’t make it (wrong place and the wrong time situation) but have been successful in the pizza business since we bought our store in 1997. I believe we are fair to our employees in their hours worked, their hourly compensation and their reimbursement/tip money. We’ve never had a complaint and passed with flying colors on a TWC audit a few years ago.

With all that said, if “gregster” believes that there are so many of us out there “cheating” the employees on their tips and pay, I suggest he take all his vast knowledge of the pizza industry and the labor/wage laws and open his own shop. I’m sure he would be very successful since he is so knowledgable in all the legalities. I’ve always thought it was pretty easy to sit back and tell the “boss” how he should be running his business when the employee has “no real skin in the game”.

I second the motion that gregster be given a vacation since he only has one agenda and will never accept another viewpoint.

 

[Bubba]

I use to have a beagle dog that would sleep all day and howl all night. At first I would go outside and look to see what it was. It was typically a squirrel or rabbit.
However, after getting up numerous times and going outside to appease the dog, I quickly became irritated.
I soon learned that he just wanted my attention, albeit for a short bit.
I simply quit paying attention to him and refused to acknowledge his presence in the nighttime. He learned real quick that if he wants to play the proper way, he better understand the role we each play in the game and respect each other.
Sometimes not doing anything can be productive.
Food for thought
Bubba

 

[Charles]

A few years back, a neighbor moved into the house next door. She had two little dogs who yapped all night long. At first I thought the little fickers would shut up after awhile. Nope. I asked the neighbor repeatedly to no effect. I called the cops hoping she would be cited. They talked to her and did nothing. One told me if it was him, he would just open her gate and let the dogs run away. :shock:

Where was I going with this? Oh, yeah. Some dogs are gonna keep yapping no matter what because they think the whole world is listening. Does not matter if someone responds. The figure the moon is still listening to them.

 

[system]

Dewar's Pizza Bakery:

gregster:

Some operators here do pool tips:
Dewar's Pizza Bakery:

Hate to bring this up for fear of ridicule. But we will are opening with our own vehicles, three to start. Drivers will earn straight wages like anyone else. Tips will be shared by the entire crew. Yeah, yeah. I know you don’t trust your employees to share.

You took that out of context. Our drivers will not be “tipped” employees. They earn at least minimum wage and use our cars. If they use their cars, we will compensate them for the use of their vehicle based on mileage.

All tips will be shared by the entire hourly crew.

Do you mind saying how many cents per mile you pay as mileage, and if you do not use the IRS rate, what is your mileage rate based on?

How is it out of context? You said it here again “All tips will be shared by the entire hourly crew.”

What exactly do you mean by “Our drivers will not be “tipped” employees”? Are they forbidden to accept tips? I don’t think that is what you mean. I think you are trying to say that you will be paying the full minimum wage to your drivers, and that you will not be paying less than minimum wage by taking advantage of the “tip credit” where tips are allowed to make up a portion of a tipped employees wage. Is that what you mean? Do your drivers receive tips? Is the “tip pool†shared with cooks and dishwashers or other people who do not regularly receive more than $30 a month in tips?

Here is the DOL’s definition of a “Tipped Employee”:

“Tipped employees are those who customarily and regularly receive more than $30 a month in tips.”

If that is what you mean, then you may be confused about what the law says about tip credit and tip pooling. Here is something I posted earlier you may have overlooked:

“Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements, such as dishwashers, cooks, chefs, and janitors.”

Here is a more detailed explanation:

http://www.dol.gov/esa/whd/regs/compliance/whdfs15.pdf

Tip Pooling: The requirement that an employee must retain all tips does not preclude a valid tip pooling or sharing arrangement among employees who customarily and regularly receive tips, such as waiters, waitresses, bellhops, counter personnel (who serve customers), busboys/girls and service bartenders. Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements, such as dishwashers, cooks, chefs, and janitors. Only those tips that are in excess of tips used for the tip credit may be taken for a pool. Tipped employees cannot be required to contribute a greater percentage of their tips than is customary and reasonable.

 

[Charles]

Gregster, though I appreciate you keeping this civil, I will not go back and forth with you. I am hopeful that you have more to contribute than just questioning our procedures and posting labor laws. My attorney says I am compliant. That is enough for me. If you have nothing more to add to the Think Tank, I hope the mods will curtail your redundant posting.