Source: https://www.employees-lawyer.com/tip-gratuity-law-california/
Timestamp: 2019-04-18 17:00:17+00:00

Document:
Tip & Gratuity Law in California: Server rights explained!
Working as a server in California is a great way to earn wages, tips, and meet new people. It’s important, however, that servers don’t get taken advantage of by their employers or other employees. California labor laws, specifically in the California Labor Code, are often misunderstood by the people they were designed to protect: the servers themselves. So it’s a good idea to know your rights as a server. This blog covers some of the basics about wages, tips, and gratuities that all California servers should know.
1 What is a “tip” or a “gratuity”?
2 Who owns your tips?
3 Is a tip a “wage”?
4 Does my employer need to track my tips?
5 Tip Pooling: Is it legal?
6 What are the consequences of employers violating tipping laws?
6.2 Filing a wage claim.
What is a “tip” or a “gratuity”?
In California, tips are the sole property of the employee to whom they’re given. ((Labor Code, § 351.)) Tips are almost never the property of the employer. ((Searle v. Wyndham Int’l (2002) 102 Cal.App.4th 1327, 1332.)) It makes no difference whether the tip is given directly to or left for the employee—the tip belongs to the employee.
Your employer must pay you the minimum wage and may not pay you a lesser amount because you receive tips.
Is a tip a “wage”?
In short, no. Under California’s Labor Code, the term “wage” means any compensation—including monetary compensation and benefits—paid to an employee for the performance of labor. ((Labor Code, § 200, subd. (a); Ware v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1972) 24 Cal.App.3d 35, 43–44.)) Intuitively, it seems like a tip would fall under this definition, but because courts define a tip as a gift from the customer to the employee, they don’t meet the definition of compensation.
In California, the employer of a tipped employee must pay at least the minimum wage—regardless of whether the employee receives a tip. In other words, servers make an $8.00 minimum wage, plus tips. Tips may not be included in an employer’s calculation of the employee’s wage.
Does my employer need to track my tips?
Yes and no. Every employer must keep an accurate record of any tips they receive. ((Labor Code, § 353.)) So, if a customer leaves a tip on a credit card and the employer receives that tip, the employer is required by law to keep a full and accurate record of the tip for any time that the tip remains in the employer’s possession. The employer is not, however, required to track tips you receive directly.
Tip Pooling: Is it legal?
It is even legal for your employer to include your supervisors in this tip pool. ((Chau v. Starbucks Corp. (2009) 174 Cal.App.4th 688.)) The employer, however, may not receive any money as a result of the tip-pooling, even if the employer provided services directly to the customer.
What are the consequences of employers violating tipping laws?
By filing a wage claim with California’s Division of Labor Standards Enforcement (DLSE).
A lawsuit is a complaint filed in court. They can be expensive, but if your damages are high enough there are lawyers that will take your case on a contingent-fee basis. In those situations, the lawyer will take an agreed-on percentage of whatever you win.
Lawsuits have their pros and cons. They are more expensive than a wage claim with the DLSE and they’re more time-consuming. But these factors can sometimes incentivize higher settlements.
Additionally, a lawsuit in the courts provides procedural safeties to employees. The DLSE, for example, is not required to follow formal rules of evidence. It may also be difficult for employees to obtain evidence to advocate for their position. In court, on the other hand, employees go through a process called “discovery” where they can seek a wide range of documents and evidence from their employers concerning matters that are relevant to their case.
Overall, however, the wisdom of filing a lawsuit will depend on the specific facts of your case. Your best option is to speak with a lawyer about the details of your case.
Within thirty days of your filing, the Deputy Labor Commissioner (“deputy”) will notify the parties of the next step. At this point, the deputy will decide whether to refer your complaint to a conference, refer your complaint to a hearing, or dismiss the claim.
If a conference is scheduled, notification will be sent to both parties. The purpose of the conference is to determine whether the issue can be settled without a hearing. If the case is not resolved at the conference, the deputy will determine the appropriate action with regard to the claim, usually referral to a hearing or dismissal (if there is not a legal basis to proceed).
Working as a tipped employee in California is a great way to earn money. In large part, this is because the tips you earn belong to you, although you may have to share them with other tipped employees, in addition to your minimum hourly wage.

References: § 351
 v. 
 § 200
 v. 
 § 353
 v.