Tip Pooling

By Douglas | Updated

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Tip Pooling is the act of gathering some or all tips earned by employees and then redistributing them according to certain algorithms.


Contents


Tip Pooling Settings

To edit your Tip Pooling settings, on the Management Console ([yoursubdomain].revelup.com) go to the Settings tab. From there click Clear Selections. Type Tip Pooling in the search box. Check the box next to the Tip Pooling option so the actual settings appear on the right side of the screen:1.png

 

The tip pool settings are:

  • Allow Tip Pooling: Check this box to turn on tip pooling. Uncheck the box to disable tip pooling.
  • Tip In Based On: Typically, tip pools are calculated in one of two ways:
    • Tips: Pool all (or a portion of everyone's) tips and reallocate them to include additional roles (like hosts, bussers, and back waiters). This way is most common in quick service establishments.
    • Sales: Roles that earn tips are expected to earn a certain amount of tips in relation to their sales. They must tip in according to their sales, not their tips earned. If they get exemplary tips, they get to keep the extra. If they get smaller tips, they might end up owing money to the tip pool. This kind of tip in is most often found in white table restaurants and is supposed to reward excellence, while making sure roles which don't earn tips still get something.
  • Tip Share: Once you have the tip pool, how do you share it out?:
    • Even: Everyone who gets a share gets an even share (based on their hours worked). This is the simplest calculation.
    • Percentage: Certain roles get different percentages of the pool. For instance, bussers may get a higher percentage than bartenders because it's assumed that bartenders are getting some tips in other ways, while bussers don't. It's only recommended that you choose this option is all of your roles work roughly the same number of hours per week.
  • Treat Declared Tips As: This setting tells Revel what tips go into the tip pool. Credit card tips are automatically tracked by the system, so declared tips are the extra cash tips that employees earn during a shift. However, some businesses use declared tips for cash AND credit tips. Depending on what constitutes your declared tips will determine which of the following you choose:
    • Total Tips: If your staff declares all tips (cash and credit), choose this option. Revel will ignore payment tips when calculating the size of the tip pool and pay attention only to the Declared Tips amount.
    • Cash Only: If your staff only declares cash tips, this is the correct option. Revel will add the payment tips to the Declared (cash) tips to come up with the tip pool.
    • Ignore Declared Tips: If your declared tips are nonexistent or inconsistent, choose this option. Revel will ignore any declared tips entered. If you do have cash tips, you can still add them to the tip pool manually as an adjustment.
  • Include Tip In Amount in Cash Due Employee/ House Lines: The Cash Due line is designed to help you cash out at the end of the night and to send servers home with the correct amount of cash they earned during that shift. If this setting is enabled, the Cash Due amount will show include how much the server owes the tip pool. For example, if a server earned $100 in tips, but owes $25 to the pool, the Cash Due amount would be $75. If this setting was not enabled, the Cash Due amount for the same scenario would be $100. If your business does not cash out at the end of the night, you should set this set this to false (leave the box unchecked). If you do cash out, this setting should be true (check the box).
  • Periodicity: This is how often your tip pool is calculated. You can select By the Week, By the Day, or By the Shift (aka, twice a day). For shift pooling, you need to select when the first shift ends and the second starts. Do not change this setting once it is selected. Only change it if you're committed to a new periodicity and do not plan to go back.
  • Tip In/ Tip Share by Role: Every role that either tips into the pool or receives from the pool should be represented here. The tip in % is the percent of that role's tips or sales that should go in the pool. If you do an even tip share, there will be a check box next to each role where you say if they get a percentage of the tip pool or not. For instance, servers might tip in 50% of their tips, but not get a share of the pool (because they get to keep 50% of their tips). This total will also reflect the hours worked for each role. If you do a percentage tip share, input the percentage of the tip pool that the role will receive. For instance, hostesses might get 30% of the pool vs bussers who get 20%. The percentages do not have to add up to 100%, but they cannot exceed a total of 100%. If percentages do not add up to 100%, Revel will scale them until they do:

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Tip Pool Tool

Once you've customized your settings, you can use the Tip Pool tool found on the Management Console. Go to Schedules> Tip Pooling.

Every tip pool must be submitted by a manager. This should be done after all orders are closed and everyone has clocked out. This guarantees Revel has the most complete data available to calculate the pool. Use the calendar to select the day for which you want to submit the pool. If you are using shifts, you'll need to select your shift as well. You may also view past submitted pool here.

The tool is divided into two sections. The share plan, where you define how much money goes into the pool, and the Employee Breakdown, where the Share Plan is applied to all employees in the pool.

  • Share Plan
    • Role: A list of all roles that were worked during the shift.
    • Hours: The total hour worked by that role, rounded to the nearest hour.
    • Sales: If the tip pool is based on Sales, the column shall be populated with the amount of sales generated by the role. If the tip pool is based on tips, this column is empty.
    • Tips: If the tip pool is based on Tips, the column shall be populated with the amount of tips collected collected by the role. This amount depends on how declared tips are treated. If the tip pool is based on Sales, this column is empty.
    • Tip in Percentage: The percent of sales or tips that the role owes to the tip pool. This is pulled from the settings.
    • Tip in Amount: The amount that the role owes to the pool.
    • Tip Share Percentage: This is the raw percentage that the role gets from the tip pool. It's pulled straight from the settings. It can be edited if a share's percentage should be higher or lower.
    • Adjusted Share Percentage: Currently, this is the Tip Share percentage scaled so it totals 100%. For instance, if there are two roles with shares of 20% or 30%, they will be adjusted to 40% and 60%.
    • Tip Share: This is the amount of the pool that goes to that role. It is the Adjusted Tip Share % times the tip pool.
    • Adjusted Tip Share: You can manually adjust the amount of money a role gets.
  • Below the main table is a smaller table for the amount of the pool itself.

    • Calculated Tip Pool: This is the amount of the tip pool as calculated roles tip in obligations. In other words, it's the sum total of the Tip in Amount column.
    • Tip Pool Adjustment: This is where you put in any unaccounted for tips (cash tips).
    • Final Tip Pool: The sum of the Calculated Tip Pool plus the Tip Pool Adjustment. This is the money that will be allocated out across all the roles:
    Share_Plan.jpg

 

  • Employee Breakdown

    This page is the results of the share plan. It shows what the state of each employee's tips are. If you are doing an even share, the page is quite simple as each employee gets the same amount of tips per hour. If you are doing a percentage based share, the page can be organized by employee or by role.

    The same tip pool table exists at the bottom of this page allowing you to adjust the total of the tip pool, for your convenience.

    • Name: The name of each employee who participated in the tip pool.
    • Role: The role the employee worked. There will be one row for each role.
    • Hours: The number of hours they worked at that role.
    • Sales: The sales made by that employee in that role.
    • Declared Tips: The employees' declared tips. Please note, this amount can be adjusted here, and will reflect back on payroll.
    • Payment Tips: The employees' payment tips.
    • Tip In Amount: The amount of money the employee owes to the tip pool, based either on their sales or their tips. If based on their tips, it is informed by how Declared Tips are handled.
    • Tip Share Amount: This is the amount of money the employee gets from the tip pool.
    • Adjusted Tip Share: The manually edited Tip Share amount.
    • Final Tips: This is the employees' earned tips, less their tip in obligations plus their share of the tip pool. It's their final take home tips and the amount that should be reported to the IRS.
    • Tips Due Employee: These are how many tips are still owed to the employee. This number is dependent on the setting Include Tip In Amount in Cash Due Employee/ House Lines.
    • Tip Pool Results: Adjusted Tip Share less Tip In Amount. In other words, how much the employee gets from the tip pool less how much they are obligated to pay into it. For instance, for a server, this number is likely to be negative, as they earn all their tips but are obligated to pay some of them out. For a busser who earns no tips, this number will be positive as all their tips come from the pool:

Employee Breakdown— By Employee4.png

Employee Breakdown— By Role5.png


  • Payroll

    Businesses can display several numbers on payroll:

    • Payment Tips: How many payment tips the employee earned.
    • Declared Tips: How many tips the employee declared.
    • Tip Pool Results: The adjustment to the tips as a result of the tip pool:

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  • Other Notes

    Please note the following:

    • Employees must be clocked in for their data to appear in tip pooling. This is true even for managers.
    • The Cash Due Employee/ House should now be able to report against live data (the pool does not have to be closed first).
    • A pool must be saved before it will appear in payroll.


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