Tip-Pooling Is Not Prohibited Under FLSA
Cumbie v. Woody Woo, Inc., 2010 WL 610603 (9th Cir. 2010)
Misty Cumbie worked as a waitress at the Vita Café (owned and operated by Woody Woo, Inc.). Woo required its servers to contribute their tips to a “tip pool” that was redistributed to all restaurant employees, including the kitchen staff (dishwashers and cooks). Cumbie filed this putative collective and class action against Woo, alleging that its tip-pooling arrangement violated the minimum wage provisions of the federal Fair Labor Standards Act (“FLSA”). The district court dismissed Cumbie’s complaint for failure to state a claim, and the Ninth Circuit affirmed, holding that “nothing in the text of the FLSA purports to restrict employee tip-pooling arrangements when no tip credit is taken” by the employer.
