The following article was originally published in The Publican magazine, Winter 2017 Edition. See it online at:http://www.emcmarketing.com/sites/emcmarketing.com/files/file_upload/Publican/2017/The_Publican_Winter_2017.pdf
by Dorothy McEwan
Employers often feel the pressure to recoup business costs when things happen that are out of their control: theft, damage, breakage, poor quality of work, etc. To protect themselves, many employers institute policies that are funded by their employees. These can take many forms, but are most commonly things like dine and dash funds, breakage, uniform rentals, and administration fees.
As tempting as these are, they are illegal. The Employment Standards Act is clear that “employers cannot require that an employee pay for any portion of an employer’s business cost”. Theft, damage, uniforms, and dining and dashing are all considered a cost of doing business. As attractive as recouping business costs are at the expense of employees, employers face an even greater risk if they contravene the Act. Any perceived savings get quickly washed away: penalties can reach up to $10,000, any monies collected must be returned to employees, and the damage in the court of public opinion can be significant.
What are alternatives to protect your business and minimize costs in the long term? Get the best employees! Good employees have choices and steer away from employers with punitive policies. They instead look to inclusive and improvement driven companies. Creating an environment where every worker is looking out for their fellow team members, means they will be looking out for your business. Attracting and retaining the best staff comes down to strong management and developing a sense of team.
There are a variety of ways you can move your employees to a strong team-focussed environment. What, for example, do your employees do about tips? Many of your successful competitors have worked with their employees to develop tip pools to ensure that all workers share in each other’s success. You might be surprised by what your employees suggest.
The following example about tip pools is direct from the Employment Standards Branch website: “An employer requires all employees who receive tips to put 15% of tips received into a pool. The pool is disbursed to all employees who do not receive tips at the end of each shift according to a formula agreed to by the employees. This activity does not contravene the Act.”
Whether you are making a change to a tip pool or not, take the time to ensure that your approach does not include employer expenses in the calculation or create situations that have employees earning less than minimum wage–both could trigger an Employment Standards issue.
Although rare, some employers have gone in the direction of no-tipping policies and instead offer higher wages and benefits to their employees. It would be an extreme change for most operations, but the topic creates an interesting debate when differing managers and owners get together. The thoughts and discussions about this approach can have a positive influence on how you deal with employee compensation and tip policies. Danny Meyer is a successful supporter of going tip free. A fun and entertaining sample of his thoughts about tipping can be viewed in The Sporkful Podcast with Danny Meyer: http://www.wnyc.org/story/restaurateur-who-got-rid-of-tipping/.
Strong management can flow from what some call a soft skill: listening to your employees. This is easy to say, but for most people, good listening is something that requires discipline and focus. Start with an easy question like asking for suggestions on how to reduce breakage. Listen–really listen–to what each of your employees say. Even if just as a trial, implement changes which are reasonable, in an evenly paced fashion.
Expand your listening to include more difficult and potentially controversial questions: What can I do to make you and the operation more successful? Do you have all the tools required to create a great customer/guest experience here? Accepting feedback from employees about the need to invest in the business to improve it can be more difficult than demanding employees cover costs for a shoplifter or a dine and dash. The right path may sometimes be the harder path, but that choice is what separates excellent businesses from all the others.
The short-term and false gains associated with inappropriate employee deductions do not pay positive returns. Having a long-term approach to becoming a great employer (with great employees) will pay dividends for years to come and be more rewarding for both you and your employees.
For more information see the Employment Standards Fact Sheet: http://www2.gov.bc.ca/assets/gov/employment-business-and-economic-development/employment-standards-workplace-safety/employment-standards/factsheets-pdfs/pdfs/deductions_wage.pdf
