Opinion ID: 811751
Heading Depth: 2
Heading Rank: 1

Heading: The Tips Act.

Text: The Tips Act contains specific provisions applicable to the restaurant industry. It provides in pertinent part that wait staff employees shall not be required to share tips with anyone who is not a wait staff employee. Mass. Gen. Laws ch. 149, § 152A(b), (c). The Act defines a wait staff employee as: a person, including a waiter, waitress, bus person, and counter staff, who: (1) serves beverages or prepared food directly to patrons, or who clears patrons' tables; (2) works in a restaurant, banquet facility, or other place where prepared food or beverages are served; and (3) who has no managerial responsibility. Id. § 152A(a) (emphasis supplied). It is clear beyond peradventure that Starbucks' shift supervisors satisfy the first two requirements for wait staff employees. The question, then, reduces to whether shift supervisors satisfy the third requirement; that is, whether shift supervisors can fairly be said to possess no managerial responsibility. Starbucks insists that shift supervisors do not have managerial responsibility within the meaning of the Tips Act. In -6- support, it points out that [a] shift supervisor spends the vast majority of his or her time, up to ninety percent, performing functions which baristas also perform. Starbucks I, 2011 U.S. Dist. LEXIS 28597, at . Moreover, shift supervisors — like baristas — report to store managers and assistant managers, and Starbucks asserts that shift supervisors lack the actual authority either to enforce directives or to hire, fire, discipline, or promote baristas. And even though shift supervisors admittedly perform some duties that baristas do not, Starbucks labors to draw a surpassingly fine distinction between these limited supervisory tasks and managerial responsibility. In an effort to justify this hair-splitting, Starbucks notes that in defining a different term — employer — the Tips Act uses the disjunctive phrase management or supervision of wait staff employees. Mass. Gen. Laws ch. 149, § 152A(a). It suggests, therefore, that the terms management and supervision must be given wholly distinct meanings. With this in mind, Starbucks declares that a shift supervisor can exercise supervisory powers without assuming managerial responsibilities. The plaintiffs resist this analysis. They argue that the definition of wait staff employee forges a bright-line standard, which excludes employees possessing any level of managerial responsibility, however slight. Building on this foundation, the plaintiffs maintain that shift supervisors, whose job descriptions -7- include some managerial tasks, are simply not wait staff employees within the purview of the Tips Act. Our inquiry into the meaning of the Tips Act engenders de novo review. See Inmates of Suffolk Cnty. Jail v. Rouse, 129 F.3d 649, 653 (1st Cir. 1997). Such an inquiry always starts with the language of the statute itself. Id. (citing Stowell v. Ives, 976 F.2d 65, 69 (1st Cir. 1992)). We assume that the ordinary meaning of the statutory language expresses the legislature's intent, and we resort to extrinsic aids to statutory construction (such as legislative history) only when the wording of the statute is freighted with ambiguity or leads to an unreasonable result. See Stowell, 976 F.2d at 69. In this case, the unvarnished text of the statute cuts sharply in favor of a bright-line rule. The Tips Act states unequivocally that only employees who possess no managerial responsibility may qualify as wait staff. Mass. Gen. Laws ch. 149, § 152A(a). [N]o means no, and we interpret that easily understood word in its ordinary sense: not any. MerriamWebster's Collegiate Dictionary 839 (11th ed. 2003); The American Heritage Dictionary of the English Language 1192 (4th ed. 2000); The Random House Dictionary of the English Language 1303 (2d ed. 1987). Courts are free to use standard dictionary definitions to assist in determining the ordinary meaning of statutory language, Riva v. Mass., 61 F.3d 1003, 1008 n.4 (1st Cir. 1995), and there is -8- no reason to refrain from doing so here. Unless we are prepared to ignore both the legislature's use of the word no and the commonly accepted meaning of that word — and we are not — it follows that if an employee has any managerial responsibility, she does not qualify as wait staff eligible to participate in tips pools under the provisions of the Tips Act. Nor is this construction of the statute unreasonable. While the legislature could have chosen a different way to grapple with the vexing problem of pooled tips, a bright-line rule has obvious virtues. The legislative history and what little case law there is confirm the conclusion that the Tips Act should be read to bar employees who possess any managerial responsibilities from participating in tips pools with wait staff employees. Under an earlier version of the Tips Act, Mass. Gen. Laws ch. 149, § 152A (2003) (amended 2004), Massachusetts courts generally applied a primary duty test to determine whether an employee was eligible to participate in a tips pool. If an employee's primary duty was to serve customers, she was eligible to participate. See, e.g., Williamson v. DT Mgmt., Inc., No. 021827D, 2004 WL 1050582, at  (Mass. Super. Ct. Mar. 10, 2004). Conversely, if her primary duty was to manage, she was ineligible to participate. See, e.g., Fernandez v. Four Seasons Hotels, Ltd., No. 024689F, 2007 WL -9- 2705723, at  (Mass. Super. Ct. July 18, 2007) (interpreting preamendment version of Tips Act). In 2004, the Massachusetts legislature amended the Tips Act. See 2004 Mass. Legis. Serv. ch. 125, § 13 (West). One apparent purpose of these amendments was to replace the primary duty test with a more precise standard. As one Massachusetts court explained, [i]n the 2004 version of the Tips Act, the Legislature rendered the primary duty analysis moot by expressly limiting the statute's protection to employees with 'no managerial responsibility.' Black v. Cranwell Mgmt. Corp., No. 2007-00122, slip op. at 13 (Mass. Super. Ct. Oct. 21, 2009). In its new incarnation, [t]he Tips Act is unambiguous and does not distinguish between employees who have many managerial responsibilities and those who have few. Id. at 13-14; see also DePina v. Marriott Int'l, Inc., No. SUCV200305434G, 2009 WL 8554874, at -11 (Mass. Super. Ct. July 28, 2009) (applying current version of Tips Act to bar banquet captains from participating in tips pools with servers). Viewed against this backdrop, Starbucks' emphasis on the predominant service responsibilities of the shift supervisors and its downplaying of their managerial responsibilities is a line of argument that time has overtaken. Stripped of rhetorical flourishes, Starbucks' position invites us to repudiate both the -10- precise language and the clear intent of the 2004 amendments and to resurrect the primary duty test. We decline the invitation. If more were needed — and we doubt that it is — the interpretive guidance of the Massachusetts Attorney General presents a formidable obstacle to Starbucks' position. See Advisory 2004/3, An Advisory from the Attorney General's Fair Labor and Business Practices Division on an Act Protecting the Wages and Tips of Certain Employees (the Advisory). The Attorney General is charged with enforcing the Tips Act, see Mass. Gen. Laws ch. 149, § 152A(f), and her interpretation is entitled to substantial deference. DiFiore v. Am. Airlines, Inc., 910 N.E.2d 889, 897 n.11 (Mass. 2009). Courts must honor such an interpretation as long as it is reasonable. Id. The Advisory could not be more clear; it states with conspicuous clarity that [w]orkers with limited managerial responsibility, such as shift supervisors . . . do not qualify as wait staff employees. Advisory at 2. The Attorney General issued the Advisory with specific reference to the restaurant industry, and in that narrow context, shift supervisors appears to be a term of art. While job titles ordinarily are not dispositive in an inquiry into the application of a statute, they are not irrelevant. Where, as here, an employer has the right to define jobs within its own hierarchy, its designation of [a] position as supervisory, while not itself determinative, is certainly a -11- significant factor in ascertaining employee status. S. Ind. Gas & Elec. Co. v. NLRB, 657 F.2d 878, 886 (7th Cir. 1981). The Advisory also elaborates on the meaning of managerial responsibility — a phrase not defined in the Tips Act itself. The Advisory states that managerial responsibilities encompass supervising employees and assigning servers to their posts. Advisory at 2. The Attorney General explains that she will look to 29 C.F.R. [§] 541.1 . . . and relevant law for interpretive guidance to define the term 'managerial responsibility.' Id. at 2 n.3. Part 541 of Title 29 of the Code of Federal Regulations, which pertains directly to the federal overtime exemption for managerial and executive employees, identifies directing the work of employees, apportioning the work among the employees, and providing for the safety and security of the employees or the property as management activities. 29 C.F.R. § 541.102. This interpretive guidance undermines Starbucks' argument. Its shift supervisors wear two hats; while they spend much of their time waiting on customers, they also have managerial responsibilities. For example, a shift supervisor is charged with opening and closing the store, handling and accounting for cash, and ensuring that baristas take their scheduled breaks. Indeed, whenever there is no store manager or assistant manager on duty in a particular emporium, the shift supervisor is the ranking employee -12- in the store. In this capacity, the shift supervisor is responsible for deploying baristas to their work stations, opening the store's safe, and handling cash register tills. Starbucks' own sources lend strong support to the proposition that a shift supervisor possesses some managerial responsibility. When deposed, Starbucks' designated corporate representative, see Fed. R. Civ. P. 30(b)(6), acknowledged that a shift supervisor is responsible for running the shift. Starbucks' internal documentation is even more revealing; its written job description for the position explains that each shift supervisor directly manage[s] three to six other employees while on shift. Shift supervisors' specific responsibilities include direct[ing] partners to various workstations and providing . . . coaching and feedback. These are party admissions, see Fed. R. Evid. 801(d)(2), and party admissions are potent evidence of employee status. Starbucks has a number of fallback arguments. The first of these suggests that a trial is necessary to determine whether shift supervisors actually possess managerial responsibility within the meaning of the Act. Starbucks is correct, of course, that the work actually performed by an employee is the most important factor to be considered when determining an employee's proper categorization in a statutory framework. Our earlier discussion of the relevance of job titles and descriptions does not suggest the -13- contrary. Here, however, Starbucks' argument lacks force. Although there may be some minor discrepancies in the record, the relevant evidence is largely undisputed. After careful perscrutation, we can discern no genuine issue as to any material fact that might require jury intervention. At any rate, the evidence canvassed above describing the work actually performed by the shift supervisors makes it pellucid that shift supervisors possess managerial responsibility. Any other conclusion would blink reality.3 Starbucks has yet another shot in its sling. It asseverates that if shift supervisors are not wait staff, then the monies given by customers to recognize their service are not tips within the meaning of the Tips Act. See Mass. Gen. Laws ch. 149, § 152A(a) (defining a [t]ip as a sum of money, including any amount designated by a credit card patron, a gift or a gratuity, given as an acknowledgment of any service performed by a wait staff employee, service employee, or service bartender). This asseveration is too clever by half and, in the bargain, confuses two separate issues: what is a tip and who is eligible to share in tips pools. To begin, it is up to the customer — who is not in any way regulated by the Tips Act — to decide whether and how much to 3 We have no need to trace the fine line that Starbucks seeks to draw between management and supervision. The responsibilities assigned to the shift supervisors, while perhaps supervisory in some respects, include plainly managerial activities. -14- tip. He acts on this intention by choosing a sum of money and placing it in the tips container. So viewed, there is simply no question but that the money placed in a tips container by a grateful Starbucks patron is a tip, regardless of who waited on him. Such sums are, in the idiom of the statute, gratuities given as an acknowledgment of . . . service performed. Mass. Gen. Laws ch. 149, § 152A(a). Here, the issue is not whether the monies collected in the tips containers are tips; it defies reason to think of them as anything else. Rather, the issue is which employees may receive distributions from the communal tips pools. It is this issue that the Tips Act resolves. In doing so, the Act prohibits a system in which wait staff and employees who have managerial responsibilities share in the same reservoir of tips. Starbucks makes a plethora of other arguments, none of which requires extensive discussion. We reject these arguments out of hand, pausing only to make three additional points. First, Starbucks protests that it is inequitable to cut shift supervisors out of the tips pools when they spend the majority of their time serving customers alongside baristas. This protest is disingenuous. Starbucks is the architect of these tips pools, which flout the law and lump together eligible and ineligible employees. If there is an inequity, the fault lies with Starbucks — not with the Tips Act. -15- Second, Starbucks criticizes both the wisdom and the fairness of the Tips Act as we have interpreted it. This criticism is misdirected. The Massachusetts legislature enacted the statute and it is not our place to second-guess either the wisdom or the fairness of policy judgments made in the public interest by a state legislature. See Vote Choice, Inc. v. DiStefano, 4 F.3d 26, 40 (1st Cir. 1993). Third, Starbucks says that the district court's decision threatens to create a windfall for baristas. That is true as far as it goes — but it does not take Starbucks very far. The windfall comes about only because Starbucks put in place a policy that transgressed the Tips Act, so Starbucks is not in a position to complain. In any event, in devising a type of 'strict liability' to achieve its goal — letting employees keep tips, gratuities, and fees called 'service charges' — the Legislature must be presumed to have factored into its calculus the risk of some service employees reap[ing] seemingly unfair benefits. See Cooney v. Compass Grp. Foodserv., 870 N.E.2d 668, 673-74 (Mass. App. Ct. 2007). In this case, all roads lead to Rome. The plain language of the Act, the legislative purpose underlying it, and the Attorney General's interpretive guidance coalesce to counsel in favor of the conclusion that Starbucks' Massachusetts-based shift supervisors are not wait staff within the meaning of the Tips Act. The evidence, even when viewed in the light most favorable to -16- Starbucks, admits of no other plausible conclusion. Since shift supervisors are not wait staff, the district court did not err in holding them ineligible to share in tips pools with baristas.