Celebrity Chef Graham Elliot Settles Tip Pooling Lawsuit

Chicago chef, Graham Elliot, has settled a tip pooling lawsuit this past week, filed by Gregory Curtis and other waiters from the celebrity chef’s popular Chicago restaurant that bears his name. The lawsuit was filed this past March on behalf of 14 former employees. In the lawsuit, the employees allege that they were forced to be a part of a tip pool, one that included workers that regularly interacted with customers (such as servers and bartenders) and workers that did not (such as food runners, bussers and cooks).

Under federal law, a restaurant may take a tip credit towards its minimum wage requirements if the employee gets to keep all the tips that he or she earned. Restaurant employers may require that employees participate in a tip pool, but only if the tip pool consists of workers who customarily and regularly receive tips. The tip pool arrangement at Chef Elliot’s Chicago restaurant was illegal because it included workers that did not fall within this category (i.e. food runners, bussers and cooks).

When it comes to tips, employers should keep this in mind: A tip pool arrangement is legal, but not for cooks, food runners, dishwashers and bussers. In other words, the employees who work “behind the scenes” should not be included in a tip pool. The U.S. Department of Labor has published a Fact Sheet for Tipped Employees which is an excellent guide for employers.