Dave & Buster's prevails in tip-pooling caseDave & Buster's prevails in tip-pooling case

Lisa Jennings

LOS ANGELES In a victory for the Dave & Buster’s restaurant chain, a Los Angeles Court of Appeals on Monday rejected a claim that a policy requiring the inclusion of bartenders in a tip pool was unlawful.

Former Dave & Buster's server Aaron Budrow had argued the restaurant’s tip-pooling policy violated California labor laws because bartenders do not provide “direct” table service. Under the policy, servers were asked to share 1 percent of their tips with bartenders and other employees.

The court, however, found the existing law does not define who may share in a tip pool based on “direct” or “indirect” service. Tips should go to whomever the patron intended to reward for service, which varies by situation, and could include a bartender because he or she mixed and poured the drink. The court held that it did not matter whether the bartender actually brought the drink to the table.

The ruling offers legal precedent that could shed some light on a gray area in California labor laws regarding who can participate in tip pools. The lack of clarity has resulted in many lawsuits involving restaurant companies and their tip pooling practices, including companies such as Starbucks, Brinker International, Darden Restaurants, California Pizza Kitchen, McCormick & Schmick’s, Applebee’s and Morton’s.

“This is a big win for employers on this topic,” said Los Angeles attorney Anthony Zaller, who was not involved in the Dave & Buster’s case.

Contact Lisa Jennings at [email protected].