Casino Wage Theft: Tip Pooling and Theft of Tips

December 8, 2023 - Overtime lawsuit, Tip-pooling, Wage Theft

From casino dealers to wait staff to VIP hosts to the valet, Casinos employ a substantial number of tipped employees. Employees in the gaming industry claim tips as their regular income, and the tips often make up a substantial part of a casino worker’s yearly wages. Table game dealers at high-end casinos can make tens of thousands of dollars in tips per year, making it a major factor in deciding which casino to work for. Players tip dealers at table games, and other casino floor staff, to receive better treatment while gambling. Because dealers have no impact on the outcome of the game, tipping a dealer will not increase the chances of winning. It rewards friendly service and table dealers are often tipped with casino chips at the end of a hand or when a player leaves the table. 

Tips at casinos are theoretically pooled in the interests of fairness. To make sure no customer is given an unfair advantage, tips are pooled so all dealers can take home equal shares. Tip pooling occurs when a “regularly tipped” employee puts his or her tips into a pool for equal division. The tips are distributed according to an agreement. Importantly, tip pools can only include employees who “customarily” and “regularly” receive tips. 

Given the thousands (or, in some cases, millions) of dollars distributed through tip pools at casinos, casino wage theft is not unusual. Management participation in tip pools occurs.  Managers cannot resist the urge to take cash from casino workers who, in some instances, earn more than management. Casino owners may also take from dealer tip pools, given the large amount of money circulated through casinos via tip pools. Employer and manager participation in tip pools is illegal, and any tip pool involving management is void. If you are forced to participate in an illegal tip pool, your contributions should be returned. 

 Casino tip pooling has become an easy and accessible vehicle for owners to commit wage theft against tipped employees, while being able to disguise their wage theft by engaging in what they will say is an “acceptable practice.” While tip pooling is often discussed in the restaurant context, the wage theft problem has become prevalent in the casino industry, as card dealers have become susceptible to wage manipulation through the tip pooling practices implemented in casinos. Tip Pooling is frequently an issue in casino wage theft cases. Recently the MGM in Springfield, Mass was sued for casino wage theft when it failed to inform casino employees “in writing” of the tip pool, failed to notify casino workers it was taking a tip credit, and failing to pay the “tipped wage” of 13.50 per hour. The state of Massachusetts also sued MGM in Springfield, resulting in a $6.8M settlement. 

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