Is it legal for an employer to take a percentage of a waiter’s gross sales to pay the kitchen staff tips?

I saw a recent ruling that an employer was allowed to take a percentage of a waiter’s tips to tip out the kitchen staff, but is the employer allowed to take a percentage of a waiter’s gross sales to tip out the kitchen staff? The employer is operating under the idea that if a waiter is good, they will receive a 12-20% tip on their total sales and so it is both motivating and minuscule to take 6 percent of the waiter’s sales from their check.

Asked on November 9, 2015 under Employment Labor Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, it is not legal. An employer may not tip, bonus, or otherwise compensate kitchen staff from waiter's base checks; in fact, an employer may not take any money from an employee's base checks except 1) as required by law (e.g. tax withholding) or court order (e.g. wage garnishment), or 2) as consented (agreed to) by the employee (like if he authorizes deductions for health insurance).

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