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Tips on Tipping for Georgia Restaurateurs

If you employ tipped workers, then this webinar is for you. Whether you are an experienced employer or just getting started in the restaurant industry, understanding the ins and outs of wage and hour requirements can be a challenge. Dive into this two-part webinar series hosted by The Georgia Restaurant Association and learn more about wage and hour regulations, notification requirements, record-keeping, deductions, overtime, and dual work.

Presented by Les A. Schneider, J. Larry Stine, and Elizabeth “Betsy” Dorminey.

Topics of Discussion

Learn below more about the topics of discussion for parts 1 and 2.

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Tips on Tipping: Part 1

Cautionary Tales: Larry & Les shared recent lawsuits against restaurant employers reaching settlements of hundreds, even millions of dollars for failure to comply with the Fair Labor Standards Act (FLSA). It is important to understand tipping requirements and practice transparency with your employees to avoid potentially costly legal proceedings.

Back to Basics: Federal minimum wage is $7.25/hr and the tip credit minimum wage is $2.13/hr. Tips received must bring your employees' hourly rate to at least $7.25/hr - if not, you are required to provide supplemental pay.

Service Charges v. Tips: While tips always belong to your employee, service charges belong to your restaurant. It is permissible to collect a percentage service charge in lieu of tips, but you must pay all participating workers at least $7.25/hr.

Make a Splash with Tip Pooling: Tip pools are a popular way to distribute gratuity among your staff. However, salaried owners and managers cannot participate in a tip pool; unless they do not claim a tip credit, back-of-house employees receiving an hourly wage or salary must also be excluded from tip pools.

What if an employee is hired for both non-tipped and tipped work? Do the same rules apply to gratuity for online orders? For the answer to these questions and more, click below to watch the full recording of the presentation.

Click here to watch the recording part 1 here

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Tips on Tipping: Part 2

Post It: Use detailed posters that comply with mandated notice requirements, including detailed explanations of any tip pool arrangements or overtime policies. A sample Fair Labor Standards Act (FSLA) poster is shown below: Deduction v. Discipline: Sometimes, employees will accidentally damage restaurant equipment or mis-ring orders, incurring costs to your business. If they are a tipped employee, you cannot deduct this cost from their tips because they are considered minimum wage workers at $2.13/hr. Instead, you may perform disciplinary action or assign the worker to another position.

Keep a Record: Maintain a record of hours worked, including overtime hours, and report tips as taxable income. If you employ children under the age of 18, ensure that their schedules and job responsibilities are in compliance with the Georgia Department of Labor’s Child Labor Work Hour Restrictions.

What to Expect in Times of Trouble: Should the U.S. Department of Labor’s Wage and Hour Division arrive at your restaurant to investigate a potential violation, it is important to prepare a plan with guidance from a trusted wage and hour attorney, who may be able to negotiate payment plans, review records, and more on your behalf.

Overtime + Dual Rates: What if I have an employee that participates in tipped AND hourly work? How do I calculate overtime for tipped employees? Can I provide wage advances?

Click here to watch the recording for part 2 here

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Presenter(s): Les A. Schneider, J. Larry Stine, & Elizabeth Dorminey
Status: Available On-Demand

Wimberly, Lawson, Steckel, Schneider & Stine

3400 Peachtree Road, Ste 400 / Lenox Towers / Atlanta, GA 30326 /404.365.0900

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