1. Donating the Proceeds of The Tip Jar
While the concept is benevolent (hey, who doesn’t like donating to a noteworthy charity?), it’s risky to divert tips that are owed to employees to any source other than the employees themselves. Under federal law, tips are the property of the employees who earn them, and employers are strictly prohibited from keeping these funds (or in this case donating them on behalf of the employee). Employers that donate tips without employees’ consent could be responsible for repaying those tips to the employees plus an equal amount in liquidated damages.
