Bill Aims to Clarify Rules on Tip Pooling

A bill filed in the Massachusetts House of Representatives would change the current law defining who can collect tips at quick service restaurants (QSR) like Dunkin’ Donuts.

State Representative Linda Dorcena Forry, (D-12th Suffolk), who is Co-Chair of the Joint Committee on Community Development and Small Business, filed the bill on behalf of the DDIFO and its members.

“While the intent of the original tip pooling law is clearly just, in practice we need to make it more precise,” said Forry. “This bill will allow quick service restaurants to place tip jars back in front of cash registers without the fear of a class action law suit. We need to do everything we can to make sure our workers earn good wages in this difficult economic time.”

Under present Massachusetts state law, no one with “managerial authority” can collect tips. While intended to prevent business owners and managers who don’t work in direct service operations from skimming employees’ tips, the statute fails to actually define managerial authority. Therefore, when literally construed, the law denies tips to nearly everyone in the team service environment that many quick service restaurants such as Dunkin’ Donuts utilize.

“We are confident the Legislature will recognize the importance of clarifying the existing law so that employees at Dunkin’ Donuts shops and other QSRs will be able to receive tips from customers who are pleased with the service they receive. On behalf of the DDIFO and its members I wish to thank Rep. Forry for her assistance on this important issue,” said Jim Coen, president of the DDIFO.

Tip pooling has been an issue across the country prompting class action lawsuits filed on behalf of restaurant workers—many of them at high end restaurants—who felt cheated when managers or supervisors shared in the tip pool. But, sit-down restaurants—especially expensive ones—operate differently from QSR’s.

Earlier this year a California Appeals Court ruling found shift supervisors were entitled to share in the tips because their while their jobs incorporate certain managerial functions, they also are involved in customer service.

Shift leaders at most Dunkin’ Donuts franchises work the counter to maintain good customer service during peak periods. In addition, they do not have the authority to hire fire or discipline an employee; nor do they earn the same wages as a manager. In some cases, their salary is only slightly higher than that of a service employee which means they rely on tips to earn a living wage.

The Massachusetts bill will be discussed before the Joint Committee on Community Development and Small Business before it moves to the full Legislature.

Related Articles: Maintaining Compliance with State Labor Laws

Rewarding Exceptional Service is Upheld in California

Starbucks wins California Tip-pooling Case Appeal

Morton’s Restaurant Settles Tip Pooling Suit

 Print This Post