No.  When a service charge is added automatically to a bill, and a customer can reasonably expect the service charge to be shared with the wait staff, then the entire service charge is to be treated as a tip. However, an employer can charge a house or administrative fee if, and only if, the employer provides a written designation of the fees that clearly states to patrons that the fee is not designated for wait staff or bartenders.

table full of glasses and napkinsIt is not enough to simply designate a fee as “administrative” or “house” on a bill: the written designation that paying customers can reasonably view is key.

If you are seeing house or administrative or service fees being charged, but you are not receiving them as tips and there is nothing to alert customers to this fact, then your employer is likely violating the Massachusetts tips law. 

We have fought and won cases involving tips being given under different names, but not making it to the intended target: the server. Two waiters came to us looking for help, so we filed a class action lawsuit and settled with their employer for $715k. (You can read more about it here.) So if this is happening to you then you need to contact us today at 508.998.0800! We do not collect any money upfront from our clients, and we only get paid if and when we win your case.