credit card tips and tip out procedures
Location: New York City
I am a server at a restaurant / club where our credit card tips go into our paycheck. If all of your tips earned in a night are through credit card, when it comes time to tip out the bussers and bartenders, you are expected to use money out of your own pocket or go to the atm to tip them. This happens often due to the fact that the majority of the bills are paid with credit cards. For example, say I make $100 in credit cards tips one night and no cash tips. At the end of the night I have to pay $30 to tip out bar and bussers out of my own pocket…but when I get my paycheck I get the $100 worth of tips. This doesn’t seem fair because on my paystubs it seems like I am making more money than I really am because I get taxed on the $100 I made but I really only earned $70 after tip out. Is this legal?
Comments
Whoever you are working for is not doing the right procedure.
Each person you tip out(busser,B/T etc.) should be assigned a # that you can pay through your computer (micro’s) to them at the end of your shift. And they also receive the money in there weekly paycheck, you should get a small printout when you do this for the amount you payed them and give it to them as proof(record)It’s absurd that they can work taxfree and you pick up the tax burden! I would consider looking for a more legit working environment if management does not agree to this.
Hope this helps..
quitting and suing sounds like fun but you’ll be better off if you keep your mouth shut, take a leisurely stroll down to the dept of labor offices in tribeca on one of your days off, fill out a detailed report and speak with an agent. keep detailed recoreds of what you’re earning, what you tip out and what your getting taxed on as well as all of your pay stubs.
not advertising your intentions will prevent your employers from covering up what they’re doing by the time a field agent gets to them (which can take up to several months). whether it’s ignorance or intentional it’s still wrong and the people you’re working for shouldn’t expect you to pay other peoples taxes. it can even be a case that the people you’re tipping out are illegal hires.
this insures you still have an income while looking for a better job. if they’re screwing you over now on your taxes it stands to reason your current employer is more than willing to screw you over in other ways as well.
Usually if the waiters get credit card tips on a paycheck every other week than the rest of stuff (bartenders/busboys/hostess) should get their tips same way. Tipping them daily from your own pocket is simply unfair. Also I would stay away from the restaurants that collect all your credit card tips and don’t pay you off every night. I’ve worked so many places where the chef, manager and so on were payd from the waiters credit card tips…. The owner was saving money on salaries. Unfortunatelly it is a very common practise these days with this beautiful post-Bush economy.
You pay taxes only on what you made after tipping everybody out. Pure and simple. Anything else is illigal.
Talk to your boss nicely about this situation first. If doesn’t work than go to see a lawyer. Good luck!