Can My Boss Take My Tips In California?

Many workers rely on tips as part of their wages, particularly waiters/waitresses, bartenders, baristas, porters and housekeepers, among many others.

In fact, it is not uncommon for some workers to earn more money in tips than in wages paid by their employer. But in the state of California, can your boss take your tips?

First of all, it is essential for a worker relying on tips to understand their rights regarding whether they can keep all of their tips or they need to share them with their boss, co-workers, supervisors, or anyone else.

Contact our Los Angeles wage & hour claims attorney at Litigation, P.C., if your employer takes your tips.

Can Your Employer Take Your Tips?

Absolutely not. Under California law, your tips belong to you, not your employer. It is illegal for an employer to take all — or any portion — of your tips if you are the one who earned them.

In other words, if a customer leaves tips for you, your boss cannot take it or force you to share the tips with:

• The owner(s)
• Managers
• Supervisors

Owners, managers, and supervisors are the employer’s agents and cannot take employees’ tips in California.

Can My Employer Count My Tips Toward My Minimum Wage?

Unlike many other states, California prohibits employers from counting employees’ tips toward their obligation to pay minimum wage. Other states, on the other hand, allow employers to pay their workers below the minimum wage if the employee’s combined tips and hourly wage equal or exceed the minimum wage rate.

Can My Tips Be Distributed Among Other Employees?

The answer to this, on the other hand, is yes. This is known as tip pooling. The practice of tip pooling — when a portion or all of the tips collected from tipped workers is pooled together and distributed among non-supervisory staff members — is legal in California.

However, it is important that employers, owners, managers, and supervisors are excluded from the pool. In addition, not all employees can participate in the tip pool. Only employees who are in the chain of service can be included in the tip pool.

Note: Owners, supervisors, and managers cannot take a portion or all of the tips from a tip pool even if they provide direct services to customers.

Tips Must Be Distributed Fairly and Reasonably

If you are included in a tip pool, your employer must have a clear and fair system for determining how much each tipped employee would earn in tips after the distribution.

Thus, California law requires the tips in a tip pool to be distributed among the employees in a fair and reasonable manner. What is considered “fair” and “reasonable” depends on the unique circumstances of each business.

You should speak with an attorney to determine if your employer has a fair tip-pooling distribution system.

If your employer takes your tips, you may be able to file a lawsuit against your boss to recover the lost tips or wages. In California, an employer or another supervisory worker taking an employee’s tips is considered a wage and hour violation.

Contact our Los Angeles wage and hour attorney at Litigation, P.C., to discuss your particular situation. Call 424-284-2401 for a case review.