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Can My Boss Ask Me to Share My Tips?

Short answer: Yes. Long answer: It’s complicated.

A question mark lingers over a plate with small bills and coins left as a tip. Photo: Shutterstock, Photoillustration: Eater.
Hillary Dixler Canavan is Eater's restaurant editor and the author of the publication's debut book, Eater: 100 Essential Restaurant Recipes From the Authority on Where to Eat and Why It Matters (Abrams, September 2023). Her work focuses on dining trends and the people changing the industry — and scouting the next hot restaurant you need to try on Eater's annual Best New Restaurant list.

Tipping is an outdated, discriminatory system, but for many front-of-house workers in America, it’s just the way it is. And for however many restaurant lobbying groups fight to keep tipping the status quo, plenty of operators — from Salt Bae to José Andrés— still fall into legal hot water, especially when it comes to mismanaging the tip pool, or how employees share tips.

Eater turned to lawyer Jasmine Moy to learn more about how tip pools should really work.

Disclaimer: The materials available in this post are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem.

Q: Can my boss ask me to share my tips?

A: The short answer is yes. Sharing or pooling of tips is allowed under federal law.

That said, there are restrictions about how and with whom tips can be shared that employers must follow in order to not run afoul of any Department of Labor or Fair Labor Standards Act regulations, not to mention laws of the particular state you’re in. State requirements may be more restrictive than those provided on a federal level so you’ll want to seek local counsel before trying to decide whether there’s something amiss about how an employer is handling these issues. (If an employee thinks they’re being paid incorrectly, many plaintiffs lawyers will do free audits of their paystub and timesheet.)

Here are the two main ways a restaurant can ask you to share your tips:

  • Tip sharing is the server calculating their total tips at the end of the shift and doling out set percentages of their total haul to eligible employees themselves.
  • Tip pooling is everyone putting their tips in one basket, to be divided among eligible employees (again, via pre-established percentages) at the end of each shift.

Sharing and pooling are similar, and are essentially treated the same when it comes to determining how they’re to be accomplished.

So how do you know if your situation is above board? There are three things you should look out for:

First, if the employer is mandating a pooling or sharing policy, that policy has to be provided to the employee in writing and the employee has to sign off that they’ve read and understood that tips are going to be shared, how they’re going to be allocated, and to whom. In New York (and other states), if an employer is taking the tip credit — which means they are paying you below the non-tipped minimum wage — they have to say so in a Wage Theft Prevention Act form. That form must have been provided to you when you were hired. That form should also have your pay rate(s), any tip or meal credits, and pay schedule (among other items), and must be provided to you in your native language. In no case can an employer surprise staff one day with the mandate to pool tips without the consent of all employees involved.

Second, not all employees are allowed to join in the tip pooling or sharing. The only employees who are eligible to take from the pool or share in tips are those who have direct customer contact as a regular part of their duties. That typically includes waitstaff, counter staff, bussers, bartenders, barbacks, food runners, hosts, and dining room captains. Managers and owners (and generally those with executive power to hire/fire) are not allowed to participate. Even if a manager might act as a bartender or floor captain for a shift or as a regular part of their service to the company, that person should always be excluded from the pool.

Lastly, the back of house staff may eligible to be included in the tip pool, but only if your employer is not using the tip credits available to them (but this varies from state to state). In other words, generally speaking, both the front and back of the house need to be making full minimum wage in order for the back of the house to be in the tip pool. So if your hourly pay is less than the minimum wage, there generally shouldn’t be any pooling or sharing with folks working solely in the back of house.

The regulations around pay in the hospitality industry are fairly intricate, and require extremely detailed record and time keeping (this gets even trickier when it comes to how to pay an employee who does both tipped and non-tipped work in a single shift). To the extent your employer is getting this wrong, assuming malicious intent would be a mistake. Even employers with good intentions trip up from time to time. (My advice for owners, obviously, is to always hire an experienced professional to help navigate these waters.)

Jasmine Moy is a business attorney whose practice focuses on chefs, restaurateurs, and hoteliers.