A Compromised Reached: Tip Pooling

On March 23rd, Congress passed their Omnibus Spending Bill which included a few components that impact the restaurant industry, particularly an amendment which addresses the highly debated topic of sharing and equally distributing tips. Tip pooling, when the servers’ tips are shared with non-tipped employees such as dishwashers or kitchen staff, has been prohibited since a federal rule was passed in 2011. This regulation stated that all tips given by patrons are property of that employee, even if the employer claims a tip credit (a portion of the employee’s tips that are used to cover the employee’s minimum wage).

Most recently, last year the Department of Labor proposed a rule that would allow restaurants to establish tip sharing, also permitting employers from keeping some tip money for the organization, so long that each employee made at least the full Federal minimum wage of $7.25 per hour. This proposal resulted in heated backlash, with workers’ rights groups and advocates arguing that tip sharing would significantly lower the pay of those employees who depend on their tips for income.

After years of going back and forth and countless changes, the new amendment states that “an employer may not keep tips received by its employees for any purposes, including allowing managers or supervisors to keep any portion of employees’ tips, regardless of whether or not the employer takes a tip credit.’’ Additionally, the bill rescinds the parts of the regulations that prohibited employers from requiring their tipped employees to share their tips with non-tipped employees.

To sum up the results of the bill, a compromise was reached in which tip sharing among employees is permitted so long as the employer does not take a tip credit. This happy medium will hopefully help employers reach the goal of creating wage equity amongst all employees who all work as a team to provide wonderful customer service.

Disaster Recovery: Part Deux

Last week, we discussed the importance of having a disaster recovery plan. Depending on the type of disaster your organization could potentially be faced with, developing a process for management and employees to follow in the event of a catastrophic event is vital to the success of continued business operations and productivity in the face of adversity your company could encounter.

There are a few basic components all disaster recovery plans should have, regardless of whether that be a major natural disaster or a security breach resulting in confidential information being compromised:

Develop a Strategy – While the plan itself will be comprised of a number of steps detailing how the organization, groups or departments, and individuals should respond to a disaster, the strategy is an initial evaluation of what your potential needs and pressing factors would be. This first assessment should include things like budget, what you need to ensure business operations are minimally halted, what resources you will need to assist in recovery (such as outside help from vendors, be that for physical labor or technical support), and what the roles of management and employees will be.

Outline Plan Steps – Create a checklist of goals and tasks that must be taken to get things back to working order. Prioritize those items, assign specific individuals or positions to each goal/task, then identify the specific, smaller tasks that each goal entails and work with the assignees to ensure that each employee knows what is expected of them.

Test the Plan – Particularly with regards to keeping business operations moving forward, testing is vital in determining any potential problems and provides your organization with the opportunity to fix those flaws before disaster strikes. While testing certainly takes time and can be a budgetary concern, figuring out a testing strategy that addresses those areas that are most important can save you resources and money in the long run.

Make sure that your recovery strategy and plan aligns with the goals of the organization and focus on resolutions that are mutually beneficial to all parties involved. Remember, the primary goal of any disaster recovery plan is to minimize and mitigate any potential negative effects a disaster can cause to your business. Most importantly, communicate your plan with your employees to ensure everyone is on board with the process and is cooperative with efforts to bounce back as quickly as possible.

Recovering from Disasters

Working at a popular theme park in the Southeast came with a unique set of challenges. When a Category 3 hurricane made landfall, a small seaside amusement park was struck hard. Damage caused by the storm surge and extreme wind gusts caused significant damage to rides and buildings throughout the park, not to mention a loss of resources by way of local vendors who were also impacted. With no choice but to close the park to the public, employees were faced with the immediate need for a disaster recovery plan to execute.

When you think of the term “disaster recovery” most people think of natural disasters, major security breaches, or situations that would compromise confidential information. While disaster recovery is commonly associated with the labor of physical clean-up projects and plans regarding risk management and technology, human resources is another department that is directly impacted in disastrous situations and warrant a disaster recovery plan to be set in place.  

Of course, major natural disasters are things to be prepared for if you’re in a region that may be affected by such an event, but there are countless other catastrophes to consider. Ask yourselves what kind of incidents could interrupt and disrupt the business operation of your organization and/or industry? A snowstorm? A broken waterline? A computer hacker? As an HR professional, taking a close risk assessment and determining how your employees and job functions will be impacted is a vital first step in creating an effective process. 

The benefits of having a plan in place far outweigh the resources required to develop one. With the means to continue operations, you can mitigate financial loss and will be better able to lead and manage your team in the event of a disaster and will be equipped with the knowledge and steps to effectively make decisions. In our next post, we will discuss the primary components of a disaster recovery plan, including how to implement the plan and successfully execute as necessary. Don’t wait until your company is already suffering the blows of a major calamity; be proactive and equipped to manage unexpected events head on.