Hands in the Tip Jar: Rights May Depend on Degree of Management

A court recently held in that employee rights to tips may vary depending on specific job duties and the degree to which one has supervisory authority. Generally, management takes no cut of employee tips. Two federal suits were filed to determine to what extent middle-management may claim a share of the tip jar.

Baristas, whose duties are to serve clients were plaintiffs in one suit and sought to have shift supervisors removed from the distribution cut. In the related second suit, assistant store managers, who have limited authority subject to the head managerial decisions, filed as plaintiffs to include themselves in the cut.

On one hand, the court disagreed that “even the slightest degree” of authority waived an employee’s rights to tips; siding with the shift supervisors, the Court said they may still be entitled to tips since their primary duty is serving the client. On the other hand, an employee is not required to distribute tips to assistant store managers; the Court held that “…an employee granted meaningful authority or control over subordinates can no longer be considered similar to waiters or busboys.” Balancing the line between minimal responsibility and “final authority,” the Court concluded that “the line should be drawn at meaningful or significant authority or control over subordinates”

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