Last week, the U.S. Department of Labor Wage and Hour Division released a statement that Hard Eight Barbecue, with five restaurants in total, failed to pay employees all of their tips by allocating some of those funds to managers, who are not allowed to dabble in the tip pool. The restaurant now owes $867,572 in back wages to 910 employees who worked from June 2019 to April 21.
When the pandemic hit and service industry workers got walloped, the boundaries of tipping grew, some with blurred lines. Digitizing tips makes it all even more ambiguous. A jar at the end of the bar or a tip left on a table was quite obvious. Even though Hard Eight began this practice before the pandemic time, the case raises good questions about new tipping trends.
Hard Eight uses a cafeteria-style service model. Diners choose to leave a tip when checking out at the counter. While being a cashier or kitchen staff doesn’t exclude someone from deserving a tip, it's not traditional. Historically, only bartenders and table servers get tips.
Now cashiers, ice cream scoopers, baristas and owners of bakeries have all flipped the screen, as they've handed you a croissant or coffee, asking if you want to add 20%, 25% or 30% to your tab. As demonstrated by the almost million dollars doled out to managers in 23 months at Hard Eight, the practice has caught on.
The Fair Labor Standards Act (FLSA) is very specific about where voluntary tips can go. In the statement on Hard Eights' back wages owed, the...
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