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Here's How Tipping Actually Works

Is this common where you are -- pooling the tips for everyone and assigning percentages?


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  1. When my son worked at an upscale Hollywood 'club/restaurant' that was how it was done. AND the tips were pooled for the entire day, not just shift by shift.

    Where I've been working, a very small place, tips are split equally by all the staff working that shift. Tips are recorded hour-by-hour to account for shifts that cross each other.

    2 Replies
    1. re: Midlife


      Does this happen in smaller or less upscale establishments, do you think?

    2. It's been years, so I may be a little fuzzy on the details, but this is how it worked at a steakhouse I worked at in CT.

      Bartenders--pooled all bar tips and divided at the end of shift according to how many hours each person worked.

      Cocktail waitresses--pooled all cocktail tips, gave a certain percentage to the bartender, and divided the rest at the end of shift according to how many hours each person worked.

      Waitstaff--pooled all meal/wine/cocktails-during-the-meal tips, gave certain percentages to broilermen, bussers, and, I think, the hostess. Gave a percentage of at-table cocktail sales to cocktail waitresses. Divided up the rest according to how many hours each person worked.

      1. There are some places that practice this method, usually within the shift. My issue with this practice is that if there is a waitstaffer that is slacking they still get compensated the same. In such places, I often ask to be seated in a certain section where I know who the waitperson is. I'll place a small tip on the check and then discretely, say via a handshake, give the wait person a 'gift of thanks' in cash. Alternately, if I have time in advance, I'll place cash in an envelope and present it to the waitperson, as it looks like a birthday card etc.

        3 Replies
        1. re: treb

          If I were working in a place that pooled tips and someone gave me something "on the side" I would, as a matter of course, put it into the "pool". If not, I'd be stealing from my co-workers. If we're pooling tips, then we're pooling tips.

          As far as the premise of the OP's question is concerned, I believe there are many different ways of how tips are distributed. I think bartenders tend to pool tips more than any other group as they tend to work more as a team than regular servers.

          Having kids in the business, in most places where they've worked, by a fairly large percentage, the servers did not pool.
          Bartenders almost always tip out bar-backs (the guy getting ice, washing glasses, generally keeping things stocked for them) and will often tip out runners unless they're running their own food (often depends on the location of the kitchen).

          Servers tip out bartenders, usually a percentage of the "bar" portion of their tabs (if they have a pos system that breaks that down for them), runners, and bussers. A server can easily "tip out" up to 30% of their tips depending on how many people they have to tip. The sommelier may get a percentage of the wine served.

          Some places will tip out hosts as well. Basically, I think it's fair to say there are almost as many different ways as there are restaurants.

          1. re: bobbert

            Didn't say it was a tip, it was a gift in the form of a card to the specific person. I think pooling is a crappy policy and you tend to see good waitstaff leave such places.

            1. re: treb

              "... say via a handshake, give the wait person a 'gift of thanks' in cash..."
              I was responding to that part of your statement. My point is that, no matter how deserved a tip is for any one individual, when you're pooling, you pool regardless of how the cash ended up on your person. I agree with you about not liking such pooling set ups but sometimes there might be legit reasons as in when different sections of the restaurant may result in much more business and therefore tips than other sections (outside on a nice day for example) and servers might rotate through those areas. I'm a regular in a place that pools but every server helps out at all tables. I'm sure someone works harder than someone else and is therefore "shorted" at the end of the night but I seem to end up with great service and return often partly because of it.

        2. in massachusetts it is illegal for management to distribute tips this way.

          the house may suggest a preferred percentage that wait staff tips out support staff, but it cannot mandate or enforce this.

          some establishments do make waiters pool. for example, if the total gratuities for the evening come to $2000, with 10 waiters working, each person gets $200 and then tips out bussers, runners, bar, etc., independently.

          it is also illegal here for any percent of tips to be disbursed to anybody on salary or making more than minimum wage.

          1 Reply
          1. re: hotoynoodle

            And the state regulators actively seek scalps in this regard, for exemplary purposes.

          2. Seemingly well researched article. Some years back l asked whether tips in a particular restaurants were pooled or not. Many times the answer was not true as it was thought if not pooled, tips would be higher.
            To give your friend, the waiter, a side tip on top of a small 'real' tip does penalize the back staff. Wonder if there is a really correct way to control your tip money's direction.

            1. I have no experience with NYC, but in my experience and that of my friends in several different states/cities/demographics (again, NYC excluded), the most common method seems to be tipping out a certain percentage of your total tips to bussers/runners/service bartenders at the end of the shift. If you had a good night, you went home with a decent amount of money (or you would get it whenever your CC tips were paid out). If you had a crappy night, you went home in a sour mood. Someone else's high sales didn't help your pocket.

              1. I've worked at places that you got whatever tips you earned. Places where tips were pulled and split evenly amongst the servers only. Places where servers got their own tips but had to tip out server assistants and hostesses and bartenders. Pretty much any sort of scenario you can imagine, it's been done.

                And I've worked at both high end establishments to more diner-type places. There is no standard rule for any one type of restaurant.

                1. Here is a lengthy series on tipping ... based on the experience of the owner a couple of (now closed) restaurants including his experience and opinions with/without tipping. It also has links to some interesting studies done on tipping. It certainly gave me a new perspective on the tipping game. http://jayporter.com/dispatches/obser...

                  1 Reply
                  1. re: firecooked

                    Just wanted to thank you, firecooked, for sharing the link to this really interesting series.

                  2. No, almost all LA restaurants that I knew (or owned) servers kept their own tips and then tipped out bartenders and busser's. Some restaurants had servers tip out the cooks too. This was the same in Hawaii, Tennessee, Florida, Washington. The only place I knew about pooled tips was in club or banquet setting and prix fie only houses.

                    Bottom line is each establishment does things a little bit different but most restaurants I have known don't pool tips.

                    1. Tip pooling sucks...like a labor union, rewards the lazy, and penalizes the hustlers

                      1 Reply
                      1. re: BiscuitBoy

                        you nailed it exactly. If you hustle and are a good people person you can make good money, anywhere.
                        It is the slackers who do all the crying, the person knocking down $200 cash a night is keeping their mouth shut, and hopefully only claiming $125.
                        Tip Pooling is just another word for union.

                      2. It occurs to me, based on this article, that wouldn't it also be odd for taxes? If your tips are based on a percentage of your sales, according to the IRS, then in this scenario, your tips are based on ALL the sales? Unless, that's how it's calculated anyway on your returns? All the sales for the restaurant?

                        But, that isn't fair either.

                        If you happen to get a large party that orders tons of food and beverages but the rest of the place isn't that busy, well, it just seems skewed.

                        2 Replies
                        1. re: Violatp

                          in a pooled house, the restaurant will split the sales accordingly for tax documentation. it's like when a large group of servers works a banquet. it's one giant bill but the revenue is portioned out, as are tips. so if the banquet bill or night's revenue is $20,000, with 10 servers working, then $2000 in sales is claimed for each.

                          1. re: hotoynoodle

                            god, that seems like a huge pain in the ass!

                            Thank goodness, I never wanted to own a restaurant.