Can My Employer Keep My Tips?

Do you work in an industry where it’s customary to receive tips from patrons? If so, is it legal for your employer to keep all or a portion of your tips?

Under Labor Code Section 351, California employers are prohibited from sharing or keeping any portion of a tip given to an employee by a patron.

Further, it’s against the law for an employer to deduct an employee’s wages from their tips or gratuities, and it’s illegal for them to use an employee’s tips as a credit towards an employee’s wages.

The law goes on to state that tips (gratuities) are the sole property of the employee who received them. California’s Labor Code defines a “gratuity” as a tip or money paid, given to, or left for an employee by a patron that is above the actual amount due for the food, drink, food, or services sold or served to the patron.

Under California law, tips belong to the employee, not the employer. The following are examples of common occupations where it is customary for patrons to tip employees:

  • Valet
  • Salon services
  • Nail salons
  • Massage therapists
  • Dog grooming
  • Servers and bartenders
  • Exotic dancers
  • Wedding vendors

Are restaurants different?

For those individuals who work in restaurants as servers, their employer may tell them that they are required to share their tips with busboys and bartenders. Are servers required to do this?

Yes, under Labor Code Section 351, every gratuity is the sole property of the employee or employees to whom it was given to or left for, and this has been interpreted to allow for tip pooling so long as the tips don’t go to the employer, supervisor, or managers of the establishment.

In effect, if you work at a restaurant, your employer can require that you share your tips with other staff that provided service to the same table or patron, so long as those employees were in the “chain of service.”

Filing a Wage Claim

Is your employer keeping your tips for themselves? Or, are they doing something else illegal, such as crediting your tips against your wages? To learn about your rights under the law and filing a wage claim, contact Los Angeles Employment Law Attorney Alan Burton Newman!

All of our consultations are free and we operate on a contingency fee basis!