Tip Pooling
Many food establishments have “tip jars” at the cash register available for customers to tip servers and cashiers. At some establishments, the staff (servers and cashiers) at the counter work as a team to deliver orders quickly to customers, making the work duties among the team members indistinguishable. When staff works as a team and the establishment distributes the tips collected to all members of the team, it is called “tip pooling.” Managers are not allowed to participate in tip pooling when they serve as “agents of management.” However, managers sharing in the tip pool can be defensible to the extent that the managers spend the majority of their time performing “team member tasks” and only a small amount of time on managerial tasks.
In order to determine whether managers should be able to share tips with the team, we observe managers performing their job during a shift and then calculate the percentage of time each manager spends on team member tasks (e.g., “Barista” tasks) and time spent on managerial tasks. We also advise employers how they can more clearly separate the duties of a manager from that of a team member, if desired, and how to ensure managers spend the majority of their time performing team member tasks.

