In August of this year we prepared a series of articles regarding the need to obtain insurance protection for the home. In those articles we discussed guidelines on how to obtain a good homeowners policy. Evaluating the adequacy of the policy in relation to the homeowner’s needs is very important. We outlined certain essential items like doing one’s own research, shopping around for an insurance carrier, understanding what is and what is not covered in a policy, and determining what are the policy limits and what it may cost to totally replace the home if it was destroyed.

With the recent fires in the San Fernando Valley and the San Bernardino areas, the homeowner is confronted once again with the necessity of an adequate homeowners insurance. We may not all live in wildfire-prone areas but the risk of a fire or other disasters is ever present. However, having a good insurance policy is not enough. Knowing how to handle the insurance claims in order to obtain full payment and benefits is equally important.

Q.    I work as a waiter in a big restaurant and we are required to pool in our tips so that our supervisor and manager can share in the tips.  Is this legal?
 
A.    No. Tips or gratuities are monies voluntarily given to or left for an employee by a customer, guest or patron of a business for an amount over and above the costs of goods sold or services rendered. Tips properly belong to the employee and not the employer.

However, Labor Code Section 351 allows involuntary tip pooling. For instance, an employer in a restaurant can require employees to pool in their tips in order to share these with other staff that provide service.  If a tip pooling is in effect, the tips are to be distributed among employees who provide “direct table service” such as servers, busboys, bartenders, hosts/hostesses and maitre d’s. This may also apply to other businesses like parking facilities, where the parking attendants can share the tips with the cashiers. However, supervisors, managers and business owners are not allowed to share in the tip pool. 
 
In March of this year, Superior Court Judge Patricia Cowett ordered Starbucks to pay nearly $106 million in restitution to an estimated 120,000 current and former baristas in California because the coffee company allowed supervisors to share in tip pools over the past eight years.   Starbucks argued that their shift supervisors basically do the same tasks as the baristas who share in the tip pool and, therefore, should be allowed to share in the tips left in the money jars.  The court, however, ruled that under state labor law, the supervisors are essentially “agents” of the company and, thus, the company's policy of allowing them to share in tips violated that law.
 
Under the law, the employer can neither share in the tip pool nor credit the tips against the employee’s wages. In California, an employer has an obligation to pay the minimum wage plus any tips left for them by patrons of the employer’s business. It is illegal for employers to make deductions from tips or gratuities.

An employer who permits patrons to pay gratuities by credit card must pay the employees the full amount of the gratuity the patron indicated on the credit card slip. The employer cannot deduct the gratuity amount for credit card payment processing fees or costs that may be charged to the employer by the credit card company.   

Tips and gratuities, however, are different from the mandatory service charge.  The latter is the amount that a guest is required to pay based on a specified service amount listed on the menu.  For example, the restaurant can charge additional 10 or 15 percent for the banquet.  These charges are not gratuities or tips voluntarily given by customers to the employees but are owed by customers to the establishment itself. 

The employer has the option to distribute all or part of a service charge to its employees in the nature of a bonus.  This bonus shall also be included in the regular rate of pay when calculating overtime payments. 
 
   
 [C. Joe Sayas, Jr., Esq. is an experienced trial attorney who has successfully obtained significant results, including several million dollar recoveries for consumers against insurance companies and big business.   He is a member of the Million Dollar-Advocates Forum - a prestigious group of trial lawyers whose membership is limited to those who have demonstrated exceptional skill, experience and excellence in advocacy.  He has been featured in the cover of Los Angeles Daily Journal’s Verdicts and Settlements for his professional accomplishments and recipient of numerous awards from community and media organizations .  His litigation practice concentrates in the following areas: serious personal injuries, wrongful death, insurance claims,  unfair business practices,  wage and hour (overtime) litigation.  He is a graduate of Georgetown University Law Center Washington, D.C. and the University of the Philippines.  You can visit his website at www.joesayaslaw.com  or contact his office by telephone at (818) 291-0088.]  Inquiries to this law office are welcome and at no cost.

Q: I work 10 to 12 hours a day but my employer pays me a fixed salary of $1,500 a month. Am I entitled to overtime payment for work done beyond 8 hours? Can I make this claim on my own or do I need an attorney to do it for me?

A: You are entitled to overtime payment even if you are a salaried employee. Depending on the circumstances of the claim, an employee may or may not need an attorney to file a wage claim.

In the previous issue we discussed an employee’s right to refuse an employer’s instruction to perform work that violates the law. If the employer retaliates against the employee because of the refusal to do an unlawful act, the employee may file a whistleblower or retaliation claim.

How can an employee know if the he or she has a whistleblower or retaliation claim? The following guidelines are helpful: