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MIAMILAW1127, Lawyer
Category: Employment Law
Satisfied Customers: 755
Experience:  Founding Partner at Moises Law, P.A.
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I live in. I work a service type position where tips are

Customer Question

I live in Virginia. I work a service type position where tips are regularly recieved and all employees are paid over minimum wage. Employees are required to pool tips. At the end of the day tips are divided based on hours worked that day. Some employees that don't perform services are also tipped in. Does the owner of the business have any right to take money from employees tips as a way of punishing employees?
Submitted: 1 year ago.
Category: Employment Law
Expert:  MIAMILAW1127 replied 1 year ago.

Hello. Thank you for contacting me. I am a consultant here and I am looking forward to assisting you with your question. If at any point any of my answers aren’t clear please don’t hesitate to ask for clarification. Please be patient as I will be typing my responses to you from scratch. Also, I can only answer/address the questions you ask specifically based on the information your provide. Please try to provide as much information as possible so I can best assist you.

Please note: This is general information for educational purposes only and is not legal advice. No specific course of action is proposed herein, and no attorney-client relationship or privilege is formed by speaking to an expert on this site. By continuing, you confirm that you understand and agree to these terms.

The short answer is that it is not illegal as long as you are being paid according to state and federal minimum wage standards. Since the employee receives at least minimum wage from the employer federal and state law allows the employer to distribute or retain the tips as they desire, including retaining them for themselves.

I hope this helps. Please use the SEND or REPLY button to keep chatting, or please RATE when finished. You may always ask follow ups at no charge after rating. Thank you.

Customer: replied 1 year ago.
When I searched for laws specific to my state of Virginia it directed me to Federal Law. The Department of Labor website said that employers and employees who do not regularly receive tips are not entitled to them and that any agreement between an employer and employee stating that an employer can do whatever they want with your tips would be illegal. If federal law states this then why would it be legal to do? The federal law did not differentiate between earning over/under minimum wage. Just simply that tips earned by employees performing a service belonged to the employee.
Expert:  MIAMILAW1127 replied 1 year ago.

Basically, what is happening is that the employer is electing to take a "tip credit" as punishment, but not outright calling it a punishment and he/she is legally entitled to do so under federal law because they are paying you over minimum wage (so the tip credit is the difference between the amount you are getting paid and the federal minimum standard for tipped employees).

Customer: replied 1 year ago.
It isn't a standard deduction that she always takes from each employee each day. Simply when the owner decides you've broken a rule, took too long to perform a service, didn't sell enough, etc. she then makes up a dollar amount or percentage that she decides the offense is worth. It is selectively enforced. Seems based on owner & managements personal feelings toward staff members at any given time. So two people can have the same offense and only one will be punished by taking money from them. I am contacting you on behalf of my team because we all feel like there is something really wrong. Not just this issue. But I thank you for all the information you've provided me.
Expert:  MIAMILAW1127 replied 1 year ago.

Ok, that specifically (in the way you described) is illegal.

Customer: replied 12 months ago.
I have worked for this same company for over 5 years and only recently did I get up the courage to ask the owner the legality of what she has been doing and she blew up at me. Said she had paperwork stating it was legal but never let me see it. Then when another employee asked to see the same file the manager said she didn't know where it was. This manager was told by the owner in front of me that it was available for anyone to look at. If you have any suggestions on steps I can take I would greatly appreciate the information.
Expert:  MIAMILAW1127 replied 12 months ago.

You should speak to an employment law attorney in the area. Have him write her a demand letter to see if she responds to that. If she does not, you may have to move forward with litigation (a lawsuit).