“Business owners absolutely cannot touch tips unless it is put into their hand directly by a customer,” said Kim Hae-won, an attorney specializing in labor laws.

http://www.koreatimesus.com/attention-business-owners-its-illegal-to-take-tips-given-to-employees/

Home   >   Business   >   Attention business owners: It’s illegal to take tips given to employees

Attention business owners: It’s illegal to take tips given to employees

July 9, 2014

A waiter picks up a tip left at a table in a Koreatown restaurant.

Business owners and managers: You do realize taking tips given to your employees is illegal, right?

It’s a violation of California labor laws and can lead to nasty lawsuits.

A 45-year-old man identified only as Kim has worked at a Koreatown restaurant for two years. Kim said he’s on the hunt for a new job after witnessing the owner slip tips from tables into his own pockets.

“I work on minimum wage and am upset at having my tips taken away from me,” Kim said. “I was going to report him, but people around me said it would be better to just move to another restaurant. I’m thinking of quitting as soon as I find another job.”

Restaurants aren’t the only places tips are disappearing. Park, a 33-year-old hairstylist, said the owner of her salon takes customers’ tips at every chance.

“A few other hairstylists and I are planning on raising the issue soon,” Park said. “After contacting a lawyer’s office, I learned that this behavior is a clear violation of the law.”

She’s right — according to California Labor Code Law No. 351, “No employer or agent shall collect, take, or receive any gratuity or a part thereof that is paid, given to, or left for an employee by a patron … Every gratuity is hereby declared to be the sole property of the employee or employees to whom it was paid, given, or left for.”

Most Koreatown restaurants practice “tip pooling,” in which waiters and waitresses are required to share their tips with non-tipped employees making minimum wage. California allows the controversial practice as long as it does not extend to employers or managers and as long as tips are divided fairly.

“Business owners absolutely cannot touch tips unless it is put into their hand directly by a customer,” said Kim Hae-won, an attorney specializing in labor laws. “Even if the business practices tip pooling, owners, managers and supervisors cannot take tips.”

Tips given to employees via credit cards also fall under the same law, although large-party gratuities automatically taken by restaurants do not.

“Conflict between owners and employees over tips are ongoing and have caused the food industry a headache,” said Daniel Oh, owner of Koreatown’s Western Soondae. “We’ve been calculating tip amounts from both cash and credit cards and distributing them fairly to employees according to their work hours.”