Oswego, NY asked in Employment Law for New York

Q: My wife works at Lombardo's Bridie Manor and my boss The Owner Lawrence Lombardo takes 75% of Gratuity from wait staff.

Is this legal?

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2 Lawyer Answers
James Francis Barna
James Francis Barna
  • Cazenovia, NY
  • Licensed in New York

A: Under New York law, an employer is prohibited from taking a portion of employees' tips, or from requiring that they be shared with nonservice employees in a restaurant setting. There is one exception to this rule: With regard to a banquet or special function, the employer may share a percentage of the service charge with nonservice employees, and retain a small handling charge for the restaurant. Taking seventy-five percent of the gratuity is likely employer theft.

My office serves all of Central New York.

Barry E. Janay
Barry E. Janay pro label Lawyers, want to be a Justia Connect Pro too? Learn more ›
  • Livingston, NJ
  • Licensed in New York

A: It's illegal. The Fair Labor Standards Act (FLSA) governs wage-related rules for tipped employees. This includes restaurant servers, bartenders, and valets -- anyone who receives gratuities from satisfied customers.

Under the FLSA, tips are considered the sole property of the tipped employee.

A "tipped employee" is someone who gets more than $30 per month in tips. The employer can only use an employee's tips as a credit to offset the employer's minimum wage obligation to the employee (called a "tip credit"), or for a valid tip pool.

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