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Unpublished Paper
Starbucks Ruling Tips the Scales: Changing California Law to Allow Supervisory Employees Their Fair Share of the Tips
ExpressO (2009)
  • Andrew Lee Younkins, University of San Francisco
Abstract
In 2008, a San Diego trial court slapped Starbucks Corporation with a $100 million judgment for violation of California's tip-sharing laws. Shift supervisors, classified as “agents” of the employer by statute, could not share in tip jar proceeds, despite spending 95% of their time performing the same duties as ordinary Starbucks baristas. More recently, the Court of Appeal reversed the judgment, reasoning that tips placed in a tip jar are not personally given to or intended for baristas, and so are outside of the statute's reach. While strong evidence suggests Starbucks supervisors should be allowed a share of the tips, the court's result conflicts with the statute's plain language, which excludes certain classes of employees from tip-sharing arrangements. This article argues that the statutory definition of “agents” should be scrapped and replaced with a more careful distinction between who can and cannot participate in tip pools. The statute's goal was originally to mirrors public expectations about who should be allowed to receive tip shares, and the Starbucks case reveals that the per se exclusion of supervisors from tip-pooling is well outside of customers' intended results. Therefore, this article proposes the Fair Labor Standard Act's definition of “traditionally tipped employee” as a better distinction between employees who should and should not be able to participate in tip-sharing or tip-pooling.
Keywords
  • California,
  • tip pool,
  • tip jar,
  • tip,
  • Starbucks,
  • supervisors
Disciplines
Publication Date
June 9, 2009
Citation Information
Andrew Lee Younkins. "Starbucks Ruling Tips the Scales: Changing California Law to Allow Supervisory Employees Their Fair Share of the Tips" ExpressO (2009)
Available at: http://works.bepress.com/andrew_younkins/2/