Legal Advice: Service Fees

BY Taylor Pepler-Madsen

SHARE

Legal Advice: Service Fees

We asked an attorney about penalties for not properly distributing your service fee.

Q: What are the consequences if a restaurant charges a service fee but doesn’t distribute it to staff correctly?”

A: “A service charge is income to the restaurant and you can do with it as you like. It’s not like a tip pool, and that’s why so many restaurants are considering moving away from the traditional tip model to a service charge they list on the check. However, you’re far better off being transparent [about how a service charge is distributed]. You’re less likely to piss off your patrons, and in terms of a happy workforce, you don’t want any gamesmanship.” —Todd Fredrickson, employment attorney, Fisher Phillips, Denver

Talk to us! Email your experiences (and thoughts, opinions, and questions—anything, really) to askus@diningout.com

ABOUT THE AUTHOR

Taylor Pepler-Madsen

More For You

March 25, 2022

Food Ball

May 6, 2022

Your Food Photos Need Work. Here’s Help.

November 9, 2021

The Breakdown

November 17, 2022

5 Heart Healthy Restaurants In Denver

Search

COPYRIGHT © 2009–2024, DININGOUT. ALL RIGHTS RESERVED