Tip-Pooling Verdict Against Starbucks Is Overturned

An appellate court has overturned a jury verdict awarded to a class of Starbucks baristas in a tip-pooling case  last year.  The wage-and-hour claim had alleged that the baristas were made to wrongfully share their tips with a shift supervisor.  The trial court had determined that California state law prohibited the supervisors from sharing the shift’s tips, despite the fact that the supervisors performed normal Barista duties in addition to their supervisory duties.  image

The Court of Appeal found this determination to be in error, explaining:

The applicable statutes do not prohibit Starbucks from permitting shift supervisors to share in the proceeds placed in collective tip boxes. . . . There is no decisional or statutory authority prohibiting an employer from allowing a service employee to keep a portion of the collective tip, in proportion to the amount of hours worked, merely because the employee also has limited supervisory duties.

This decision is limited to California wage-and-hour law but has positive implications for all employers–especially those in the hospitality industry, who are most often the target of tip-pooling lawsuits.

Read the full court decision:  Chau v. Starbucks.  Or see these blogs for additional summaries:  Overtime Advisor; California Labor & Employment Law Blog; Shaw Valenza, LLP; San Francisco Employment Law Firm Blog.

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