Starbucks Tip Jar The Subject Of New York High Court Case

    May 28, 2013

Who gets the money from the Starbucks tip jar? That’s the question currently up for debate in a New York courtroom this week.

CBS News reports that New York’s labor laws are currently being tested in the Court of Appeals. Baristas argue that only they are allowed to take money from the tip jar as they are the ones directly interacting with customers. Assistant managers don’t necessarily work directly with customers, but they feel that they are entitled to the money in the tip jar as well.

So, what’s the big deal? The big deal is that the courts now have to decide whether or not shift managers qualify as “agents” under New York labor laws. If the court rules that they are agents, then assistant managers would be barred by law from taking money out of the tip jar.

On the side of the baristas, they argue that Starbucks has not “seriously disputed that its shift supervisors are supervisors.” In other words, Starbucks has never explicitly told assistant managers that they are not supervisors. It should be noted that shift supervisors share in the tip pool with baristas while assistant managers are arguing in court to share in the tip pool.

As for the assistant managers, they argue that their inability to hire of fire employees makes them less of an agent and more of a low-level employee. They also argue that they do frequently interact with customers thus entitling them to tips.

What do the higher ups at Starbucks think about all of this? They argue that assistant managers shouldn’t get access to the tip jar because they are full-time, salaried employees. In other words, they get paid enough as it is. The tip jar is for the part-time baristas and shift supervisors to make a little more on top of their meager wages.

One federal judge has already ruled that shift supervisors aren’t agents, but she also said that New York’s labor laws don’t require companies to allow every eligible employee to collect tips. Now the Appeals Court must decide if assistant managers can share in the tips with everybody else.

As you would expect, the ruling from the Appeals Court would have wide ranging consequences beyond Starbucks and other coffee shops. If the court rules in favor of the assistant managers, tips will be spread across more people in service industries. It may be fair, but it would also force restaurants that practice mandatory tipping to charge more for tips so that everybody gets a fair share.

[Image: Gingerblokey]