Where Do Your Tips Really Go? The Case for Nova Scotia’s Labour Standards
Written by Riley White, 3L, Senior Law Student at Dal Legal Aid
When you leave a tip at a restaurant, you probably expect the money to go to the server who gave you service. In many provinces in Canada this may be true. However, in Nova Scotia, this may not be the reality as servers’ tips are not protected in the province. This leaves servers vulnerable to their employer taking some of their tips for themselves or using it for other purposes.
If you are a Nova Scotia server and have had tips taken away from you to pay for a staff party or a “dine and dash fund”, this is an example of the employer behaviour that is permitted in Nova Scotia. Or if you are like me and worked in a restaurant which used a tip pool system (where tips are collected at the end of a shift and redistributed) and an undisclosed and suspiciously large amount of tips were deducted from your pay for no apparent reason, is permitted in the province.
This situation is incredibly frustrating to servers who lose money from the lack of protection and is also frustrating to those who leave the tip who end up putting money into the owner’s pockets even though they intended for it to go to the server.
Nova Scotia remains one of the few jurisdictions in Canada without legislation specifically protecting employees’ tips. While many provinces have enacted “tip protection” laws to prevent employers from keeping gratuities that were intended for employees, Nova Scotia leaves these questions up to employment contracts.
The Nova Scotia Labour Standards Code establishes minimum employment standards for employees, including laws on wages, and deductions from pay. However, tips and gratuities are expressly excluded from the Code’s definition of “pay”. The Code does not establish a law stating that a customer’s gratuity belongs to the employee who earned it or prohibiting an employer from taking a portion of it. Consequently, a server in Nova Scotia who discovers that their employer is taking a portion of their tips cannot simply point to a provision of the Labour Standards Code claiming that the tip belongs to them.
Other Provinces’ Approaches to Tip Protection
Nova Scotia may look to Ontario’s Employment Standards Act for an example of how to navigate tip protection laws. Under Part V.1, an employer cannot withhold an employee’s tips or deduct from them. Further, tip pools are permitted in Ontario, however an employer cannot take a share of the tips unless they regularly perform substantially the same work performed by other employees who share in the tip pool, or employees of other employers in the same industry who commonly receive a share of tip pools or other gratuities. If an employer unlawfully takes tips, the amount can become a debt owing to the employee and can be enforced under the Employment Standards Act.
Ontario’s approach demonstrates that tip protection does not have to mean eliminating tip pools altogether. Restaurants are collaborative workplaces, and it is reasonable for servers to share tips with bartenders, hosts, bussers, and other employees who contribute to a customer’s experience. The important distinction is between sharing tips among employees and an employer taking employees’ tips for themselves.
This distinction is also reflected in other provinces’ legislation. British Columbia’s Employment Standards Act permits tip pooling but restricts employers from using tips to cover certain business expenses, such as breakage, spillage, or customer losses. New Brunswick’s Employment Standards Act states that tips and gratuities are the property of the employee to whom they are given and shall not be withheld by the employer or treated by the employer as wages. New Brunswick allows for a tip pool system for the benefit of employees but does not allow for an employer to have a proprietary interest in the pooled tips. These approaches demonstrate that provinces can protect employees’ tips without preventing restaurants from using tip-pooling systems for the benefit of all employees.
Where Nova Scotia Can Go from Here
Bill 366, a private member’s bill which was designed to amend the Nova Scotia Labour Standard’s Code, received a first reading in 2023. The Bill aimed to make tips and gratuities the property of the employee to whom they are given and prohibit employers from taking a proprietary interest if a tip pooling system is used. Although the Bill had good intentions, it was never advanced past the first reading. This leaves Nova Scotia servers and other workers who work for gratuities, without tip protection.
Nova Scotia legislators should revisit this this issue and create a new bill to address the tip protection gap in this province. When a customer leaves money to recognize the good work of a server, that server should receive that tip and not go to the benefit of their employer. Nova Scotia should give its restaurant workers and other employees who rely on gratuities that protection and certainty.
Get involved with our Tip Theft campaign here: www.halifaxwac.ca/campaigns