What Are the Drawbacks of Tip Pooling?

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Some restaurants require servers to share a portion of their tips with the bartender. This is known as tip pooling, and employees who have worked around fancy café chairs and outdoor benches have likely experienced it. This term has been thrust into the news lately, however, due to the new presidential administration. President Obama banned tip pooling with back-of-the-house employees, but the Trump administration is considering ending this policy. Before this takes place, restaurateurs should know some of the drawbacks of tip pooling.

Great Employees Less Motivated
Workers who handle the commercial restaurant equipment in the back of house know exactly what they’re getting paid on a given night. This isn’t the case for servers, and if their tips are being shared with other waitstaff or the back of house, they can quickly become unmotivated knowing they’ll make the same regardless of what they do.

Of course, this isn’t entirely true. The harder each employee works for the café chair occupants, the more money that will go into the tip pool. Unfortunately, this fact isn’t always enough to motivate great employees who know their tips will be shared, and this is especially the case if there are “freeloaders” who do the minimum necessary and ride on the backs of better employees.

Dishonest Staff May Take Advantage
Even if a restaurateur seats all their employees in the café chairs pre-shift, offers free appetizers and rationally explains why tip pooling is important, there will be servers who don’t like the idea. Some will respond by working harder to ensure they take home more each night, but less honest staff members may decide they’re just going to pocket their tip money or put in less than they received.

It’s hard to tell a server who worked hard that they’re not entitled to the tip they were given, but if tip pooling is used and the waitress or waiter pockets the money, they’re essentially stealing. This can lead to great employees being reprimanded or, in most cases, terminated from their position. It’s important for a restaurateur to explain this if they’re going to implement tip pooling.

Complicated Splitting Issues
Even if everyone working in a restaurant is okay with tip pooling, the big thing that many culinary entrepreneurs overlook is the fact that everyone works different hours. Even if five servers show up for the same shift, there’s a good chance that one or more may be cut early because things are slowing down.

When this happens, how should tip pooling be handled? Should all the servers still receive the same amount? Should they be given their portion of the pool that exists when their shift ends, and if so, how would credit card tips that aren’t fully entered until the end of the night work? These are all essential considerations when looking at tip pooling.

There are several types of tip pooling, and who is involved in these pools can vary by restaurant. There are certainly benefits to this tipping policy. For instance, it lessens income disparity between front and back-of-house employees and helps servers who simply had a bad section one night. When considering these benefits, though, it’s essential to take into account how the servers will feel. Otherwise, the occupants of the eatery’s café chairs might just start receiving subpar service.