Agents and Employees
The question of which types of employees are considered agents of their employer for purposes of sharing in tip pools has come to the forefront in a number of cases filed against Starbucks. The Starbucks litigation is an excellent reminder to employers that issues concerning the payment of wages, in particular tip pooling, may involve not only the federal labor law (i.e. Fair Labor Standards Act) but may also touch on various state labor laws.
Under federal law, employers are permitted to pool the tips of those employees “who customarily and regularly receive tips.” 29 U.S.C. §203(m). Some examples of the types of employees who “customarily and regularly receive tips” are waiters, bellhops, waitresses, busboys and bartenders. Under federal law, a valid tip pool may not include employees who do not customarily and regularly receive tips, such as dishwashers, cooks, chefs and janitors. But what about an employee, who is principally responsible for serving customers but also has some limited supervisory responsibilities,
Additional Resource: Which types of employees are considered “agents” of an employer for purposes of sharing in tip pools?