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Leon
Leon, Solicitor
Category: Australia Law
Satisfied Customers: 42631
Experience:  BEc Dip Ed, Dip Law (SAB) MTax (UNSW)
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Tip Distribution policy We distribute tips in accordance to

Customer Question

Tip Distribution policy
We distribute tips in accordance to this policy nightly, we hold a 15% for the restaurant and distribute the rest to the staff working
one of my employees is saying 100% of tips should go to them and nothing to the restaurant are there some fact sheets on this in Australian law please
Submitted: 1 year ago.
Category: Australia Law
Expert:  Leon replied 1 year ago.

Good Afternoon

My name is ***** ***** I am a NSW Solicitor. Thank you for your question, and will do my best to assist you with your question. Please understand this is not legal advise Please understand this is not legal advise but a guide to assist you.

Tips are paid because the patron wants to reward the staff. So in reality it is paid to be given to the staff.

There is no law though that covers this.

In reality I agree nothing should go to the restaurant. They are meant to be a reward for the good service provided to the patron by the staff.

I am not sure where the 15% kept by the restaurant comes from.

Customer: replied 1 year ago.
Is there any fact sheets from Fair Work or the ATO you can provide on this
If we hold 15% for Admin purposes that we use for Christmas parties etc.
This is our TIP Policy - we distribute the other 85% to the staff on the night
Are we breaking any laws with our policy
I understand from the ATO we need to have a policy and communicate it to the team and record the distribution to the team so we have records they received it
My question really is - is a any law that says 100% of voluntary tips need to go to floor staff only
. this is really the question, sorry I may not have been clearthanks Phillip
Our we
Expert:  Leon replied 1 year ago.

Good Evening

There is no fact sheet I am sorry to say.

If this is policy and the contracts of the employees say this in them when they sign you can do it.

But if you do not have it then the employees are entitled to them.

The ATO simply says if you receive tips you have have to declare them as they are income and you have to pay tax on them.

There is nothing about you withholding them.

the 15% you keep is taxable in your hand as income.

Even the award does not mention them

https://www.fwc.gov.au/documents/documents/modern_awards/award/ma000119/default.htm

But they are paid to reward the service of the staff and the staff are entitled to it.

But it is your call on how you have employed them and the terms in the contract.

i hope this makes sense?

Expert:  Leon replied 1 year ago.

Good Morning

Are you still in need of Assistance?

Expert:  Leon replied 1 year ago.

Good Evening

Just a follow up message to see if you need any further assistance? I look forward to hearing from you.