Tip Pooling Legality Checker by State

What federal law actually says about tip pools

The Fair Labor Standards Act lets an employer require tipped workers to share tips through a pool. The 2018 Consolidated Appropriations Act (Pub. L. 115-141, div. S, tit. XII, section 1201) rewrote two things about that pool, and both still control in 2026.

First, employers, managers, supervisors, and owners may not keep any portion of an employee's tips for any purpose, including through a pool, no matter how the staff are paid (29 U.S.C. 203(m)(2)(B)). A manager can keep a tip a customer hands them directly for service that manager solely provided. Drawing from the pool is a separate thing, and it is barred. Who counts as a manager comes from 29 CFR 531.52(b)(2), which borrows the FLSA executive-exemption duties test: primary duty is management, the person customarily directs two or more employees, and the person can hire or fire (or make recommendations that carry particular weight). Title on the schedule does not decide it, duties do.

Second, back-of-house staff can be in the pool, but only when the employer pays the full minimum wage in cash and claims no tip credit (29 CFR 531.54(c)(2)). The moment the employer takes a tip credit, the pool narrows to employees who customarily and regularly receive tips, and cooks, dishwashers, and prep have to come out.

The federal numbers behind that: $7.25 minimum wage, a $2.13 tipped cash wage floor, and a maximum tip credit of $5.12 per hour. Your state may set all three higher.

One piece of context, since older guides still cite it: the 80/20/30 dual-jobs rule is gone. The Fifth Circuit vacated it in Restaurant Law Center v. DOL, 115 F.4th 396 (5th Cir. 2024), and DOL withdrew it by final rule in December 2024, restoring the 1967 dual-jobs regulation. This checker does not apply it.

The eight states with their own tip-pooling rules

Only eight jurisdictions have a verified statute or regulation that changes who may be in a tip pool. Everywhere else, federal rules are all that govern pooling, even though the wage figures differ state to state.

• California (Cal. Lab. Code 351): mandatory pools are expressly allowed, but participants must be in the chain of service. Line cooks and dishwashers generally qualify; office, accounting, and delivery-only staff generally do not (Leighton v. Old Heidelberg, Ltd., 219 Cal. App. 3d 1062 (1990)).
• Delaware (19 Del. C. 902(c)): an employer-required contribution is capped at 15% of the primary direct-service employee's tips, and a valid pool is defined as direct-service employees.
• Kentucky (KRS 337.065): an employer cannot require pooling. Employees may agree to share voluntarily, and salaried staff, managers, and supervisors stay out.
• Massachusetts (M.G.L. c.149 152A): pools are limited to wait staff, service employees, and service bartenders. The statute bars an employer from causing, requiring, or even permitting remittance to non-service staff, so back-of-house is out regardless of the tip credit. Violations carry mandatory treble damages under M.G.L. c.149 150.
• Minnesota (Minn. Stat. 177.24 subd. 3): tips are the property of the employee who receives them, and an employer cannot require sharing. Voluntary, employee-run pools are fine.
• New Hampshire (RSA 279:26-b): pooling must be voluntary, among directly tipped employees within the same job category.
• New York (Lab. Law 196-d; 12 NYCRR 146-2.14): eligibility turns on duties, and the pool is limited to employees who provide direct service to customers. Back-of-house is out whether or not a tip credit is taken.
• North Dakota (N.D. Admin. Code 46-02-07-03): pooling is allowed only after a recorded vote in which 50% plus one of the tipped employees approve it.

You will find plenty of articles claiming that seven states ban mandatory tip pooling. That is a mix-up. The seven states usually listed (Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington) are the states that ban the tip credit. Of those seven, only Minnesota actually restricts mandatory pooling, and California expressly permits employer-mandated pools. If you want the wage side of that distinction, the tipped minimum wage by state tool has the 2026 figures.

Voluntary vs mandatory pools, and why the distinction matters

In Kentucky, Minnesota, and New Hampshire, the question is who set the pool up. A group of servers who decide among themselves to split the night's tips is doing something those statutes allow. A manager who posts a policy, deducts from your sheet, or schedules you off for opting out is doing something they do not allow. Coercion counts: an arrangement that is voluntary on paper but punished in practice is not voluntary.

The distinction has limits, though. A voluntary pool does not cure a manager taking a share, an employer keeping a house cut, or back-of-house sitting in a pool while the employer claims a tip credit. Those federal rules apply no matter who organized the split. In this checker, leaving the "employer requires me" box unchecked turns off the state mandatory-pool rules, and nothing else.

Percentage-based tip-outs to bar, bussers, and hosts are a separate question from legality. The tip out calculator handles the arithmetic once you know the arrangement itself is sound.

What to do if your pool looks illegal

Document first. Dates, shift, your gross tips, what came out, who received it, and who ordered it. Contemporaneous records carry far more weight than a reconstruction six months later. Server44 logs cash and card tips per shift, records each tip-out rule you are subject to, and exports a CSV or PDF you can hand to an investigator or an attorney. You can get the app here.

Then pick a route. Raising it with the employer sometimes fixes a genuine misunderstanding, especially around who counts as a supervisor. Filing with the DOL Wage and Hour Division at 1-866-487-9243 costs nothing, and retaliation for filing is itself unlawful under 29 U.S.C. 215(a)(3). Your state labor department is often faster and sometimes gives you more. A wage-and-hour attorney is worth a call when the amounts are large or the employer has already dug in.

Watch the clock. FLSA claims generally reach back 2 years, or 3 years if the violation was willful (29 U.S.C. 255(a)). Recovery under FLSA 216(b) is the unlawfully kept tips plus an equal amount in liquidated damages. Massachusetts trebles instead. Separately, DOL can assess a civil money penalty of up to $1,409 per violation for unlawfully keeping tips (29 CFR 578.3(a)(1)), which goes to the government rather than to you.

A last reminder: everything on this page is educational, not legal advice. This tool checks a fixed list of patterns against federal law and eight state statutes. It cannot see your handbook, your job duties, your city ordinance, or your paystubs. Confirm your situation with your state labor department, the DOL Wage and Hour Division, or an employment lawyer before you act on it.