As anticipated, a new legislation has been introduced regarding the practices around tips/gratuities and Employer Rights and Responsibilities that will directly affect all aspects of the Restaurant and Hospitality business.
Starting June 10, 2016, it will be illegal for employers to keep a portion of employees’ tips and other gratuities, except as permitted by the Employment Standards Act, 2000 (ESA).
These rules affect employers and employees covered by the ESA in workplaces where tips and gratuities are received – such as at bars, restaurants, hair and nail salons, catering firms and taxis.
What does this mean for Restaurants? Specifically, Clients of Fifteen Group?
Ontario government defines as tips and gratuities:
Tips and gratuities include money voluntarily given by a customer for customer service. It could be given to the employee directly, like money left on a table or bar for a server. Or it could be given to the employee indirectly, like a tip paid using electronic payment like debit or credit, or in a tip jar.
Tips and gratuities can also include any service charges imposed by an employer on a customer that the customer intends or assumes would be given to employees (e.g., banquet hall service fees, catering service fees, group table service charges).
Essentially, any funds that can be interpreted by a “reasonable person” to be considered in excess of the invoiced amount and assumed to go directly or indirectly (in the form of tip pool)
While much of Bill 12 now clearly defines practices within the industry with regards to gratuities all operators should familiarize themselves with the Bill.
Below are links to some useful resources to help familiarize yourself with the new legislation
The Ontario Legislative Assembly – Bill 12
Ontario Restaurant Hotel Motel Association (ORHMA) – Bill 12 Article
Ministry of Labour – Employee Standards Act Memo – Bill 12
Ministry of Labour – Tips and Gratuity Guidelines
Ministry of Labour ESA Workbook
Ministry of Labour – Tips and Gratuities FAQ’s