MPP to owners: Hands off tips

Change to ESA would prohibit Ontario employers from taking any portion of servers' tips
|hrreporter.com|Last Updated: 11/11/2010

It's common practice for wait staff in restaurants to share their tips with other staff, including bussers and dishwashers, but more managers and owners in Ontario are taking a cut of waiters' tips, according to New Democrat MPP Michael Prue.

His research shows anywhere from 0.5 per cent up to four per cent of servers' tips go directly to owners and/or mangers.

“This is an unfair practice and it must be stopped. They cannot take the earnings of their staff in order to pay for their costs of doing business,” said Prue.

To protect these workers, Prue introduced a private member's bill to amend Ontario's Employment Standards Act.

Bill 114 would add just one sentence to the act: "An employer shall not take any portion of an employee’s tips or other gratuities."

If passed, the bill will end the practice of “tipping out” to restaurant owners and management staff, said Prue.

The bill had its first reading on Oct. 28 and has received all-party support in the Ontario legislature. It's even gaining support in the owner community.

“As a bartender, I was shocked to find that some of my bosses expected me to share my tips with them. They earned far above what I earned, but I was afraid to challenge them for fear of losing my job. As an owner, I would never expect my employees to pay for my business costs from their hard-earned tips," said Francesca Zeilinski, a bar owner and former bartender.

Servers usually earn minimum wage but they're taxed on the assumption they'll make an additional 12 to 15 per cent in tips. If an owner is taking a portion of that tip, the server not only loses the tip but also loses a disproportionate amount to income taxes.

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