Perry Glantz, Carrie Francis Write Column on Tipping Risks for Private Clubs
The article examines how private clubs can best avoid risk with service charges on food and beverage sales. Plaintiffs' attorneys have brought suits alleging that clubs should classify these service charges as "tips or gratuities" and therefore disgorge the charges and pay them to a class of past and present employees. Some states would subject the employer to a penalty for withholding the money that could double the damages owed.
Perry and Carrie provide a list of steps private clubs should take to avoid risk:
- Audit existing service charges and tip practice to determine the proper collection, distribution and classification of such funds;
- Review internal documents and communications for references to service charge and tip policies to avoid allegations of any misrepresentations;
- Review compensation structure of club employees and payment of service charge revenue and any gratuities or tips for compliance with applicable law;
- Review notice provisions to employees and customers for compliance with applicable law; and
- Ensure appropriate training of management and staff regarding service charge and tip policies and procedures.
Perry has more than 25 years of experience as a lead trial lawyer in all aspects of banking litigation, trust and fiduciary litigation, real estate litigation, oil and gas litigation and general commercial litigation.
Carrie counsels employers throughout several state and federal jurisdictions across the country. She has particular expertise in complex state and federal wage and hour litigation claims and she also has considerable experience representing clients in matters involving trade secret misappropriation, unfair competition, covenants not to compete and employment agreements.
Read the full story "Danger: Service Charges and Tipping Policies."