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If you've ever worked in the service industry, you are aware of the ongoing controversy surrounding tips. No matter how organized the system, something always seems to go awry. Whether another coworker slips away with a larger portion of the tips, the closers are skimming off the top, or the system itself is unjustly balanced, issues always arise. For some people, tips are their sole form of income. There are no paychecks. There is no salary. Just tips. So it's no surprise that the Starbucks tip jar is currently at the center of a New York high court case.
New York's top court will look into a controversy over Starbucks baristas' tip jars, according to the Associated Press. The case spawns from the question of whether or not supervisors and assistant managers are legally entitled to take a portion of their employees' tips.
The Federal Court asked The Court of Appeals to interpret New York's labor laws and its definition of an employer's "agent," who is prohibited from tip sharing.
There are three classes of employees at any given Starbucks. There are the baristas that share the tips based on their hours worked, assistant managers who are not given any portion of the gratuity, much to their chagrin, and shift supervisors with lower management responsibilities that also serve customers and share tips with the baristas.
Although the case arose from an ongoing controversy at Starbucks, the decision will ripple through nearly 42,000 New York state businesses that operate in a similar fashion. The issue stems from disgruntled baristas and assistant managers that have filed lawsuits against Starbucks over their tipping policy.
Attorney Shannon Liss-Riordan, who argues on behalf of the baristas that are against sharing weekly tips with their supervisors states, "Starbucks has not seriously disputed that its shift supervisors are supervisors," who receive higher wages.
They lack the authority to hire and fire staff and therefore should not be considered company agents under the law, wrote attorney Adam Klein, who represents the assistant managers.
The Federal Appeals Court is currently looking for answers into two specific questions: What factors determine whether an employee is an agent of the company? Does state law permit an employer to exclude an otherwise eligible tip-earning employee from sharing in such a tip pool?
One of the many Golden Rules of the service industry is not to mess with other people's tips. Keep your hands out of the cookie jar and let those who need it and deserve it the most enjoy the fruits of their labor. It will be interesting to see how the case unfolds, and there will undoubtedly be major backlash in its wake.