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A recent ruling by the Massachusetts Supreme Judicial Court says that an employer who employs wait staff employees and has a clearly communicated “no-tipping” policy may retain the tips left by customers or make the tips available to other customers.

In 2003, the defendant in Meshna v. Scrivanos, SJC-11618 instituted a no-tipping policy at all of their Dunkin’ Donuts franchises.  Under the no-tipping policy, an employee was not permitted to retain money left by a customer and is required to inform the customer of the no-tipping policy.  Retention of the tip would result in disciplinary action including possible termination.   Current and former employees asserted that the money belonged to the employees and the current policy violated the Tips Act, G.L. c.149, §152A (b).

The SJC found no language in G.L. c. 149, § 152A (b) or elsewhere in the Tips Act prohibiting a “no-tipping policy” as the employees claimed. The court concluded that the “no-tip” policy was clearly communicated to customers.  Therefore there was no violation of the Tips Act if the sums of money that nonetheless have been left by customers are retained by the employer, or placed in a “abandoned change” cup to be used by for another patron.

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