HR Alert

New Hampshire Law Clarifies 'Tip Pooling'

New Law Effective September 3, 2017

Under a new law in New Hampshire, employees who participate in a tip pool may provide a portion of the common pool to certain other employees.

Tip Pooling Arrangements
According to the new law, nothing precludes employee participants in a tip pool from agreeing (voluntarily and without coercion) to provide a portion of the common pool to other employees, regardless of job category, who participated in providing service to customers.

Background
Under current law, tips are wages and are the property of the employee receiving the tip and must be retained by the employee, unless the employee voluntarily and without coercion from his or her employer agrees to participate in a tip pooling or tip sharing arrangement.

No employer is prevented from administering a valid tip pooling or tip sharing arrangement at the request of the employee, including suggesting reasonable and customary practices, and mediating disputes between employees regarding a valid tip pooling or tip sharing arrangement.

"Tip pooling'' means the voluntary practice by which the tip earnings of directly tipped employees within the same job category are intermingled in a common pool and then redistributed among participating employees.

"Tip sharing'' means the practice by which a directly tipped employee gives a portion of his or her tips to another worker who participated in providing service to customers.

The new law takes effect on September 3, 2017. Click here to read the text of the new law. The current law regarding tip pooling and tip sharing is available by clicking here.


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