Café Gratitude Sued By Employee Over Tip Pooling

Categories: SFoodie

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Taniamarie.com
Café Gratitude, the vegan/raw food restaurant whose menu tells you what you are today ("I Am Elated" is an enchilada, "I Am Transformed" is tacos), is being sued by an employee who just isn't feeling the love.

Sarah Stevens claims in a suit filed in Superior Court that Café Gratitude's tip pooling scheme took money from her. Or, "I Am Entitled."

Stephens says she has worked for Café Gratitude since 2005, and still works at the Harrison Street location.

According to a press release issued by Stevens' attorney Stephen Sommers,

"In addition to not receiving her rest and meal periods, Stevens alleges that she is required to participate in an unreasonable and uncustomary tip pooling scheme that leaves her with a very small percentage of the tips she earns as a server. Specifically, Stevens alleges that after tipping out 20% of her daily tips to the 'central kitchen' -- an offsite kitchen on 14th Street -- Stevens must then split the remaining 80% of her tips equally with all of the Café Gratitude staff, including the 'shift leaders' and retail employees."

Wow, "I Am Shortchanged!"

Reached by phone, Sommers told SF Weekly that he expects to ask for more than $75,000. "The law does not permit a restaurant to give tip money to people who aren't part of what they call 'the service chain'," Sommers said, citing California Labor Code sections 350 and 351. "You can give a little bit of money to the host, but not to a short-order cook."

Chandra Gilbert, Café Gratitude's director of operations, told SF Weekly, "We have a tip-sharing policy that we allow our employees to vote on. The only people allowed to vote are those who get tipped."

Gilbert said the most recent vote was held just last week, and "88 out of 103 traditionally tipped employees voted to continue to share with everybody," she said. "We also have people sign a voluntary tip agreement when they're hired." Gilbert said Stevens signed the agreement and added, "She is an employee in good standing at this time."

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Cafe Gratitude - CLOSED

2400 Harrison, San Francisco, CA

Category: Restaurant

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25 comments
Anthony
Anthony

I know Matthew & Terces Englehart personally, and am proud to call them teachers and mentors.  I can tell you from personal experience that they are 1) community builders FIRST, & 2) entrepreneurs SECOND.  They have always believed in putting PEOPLE over profits.  I stand beside them during this challenging time.  They are the real deal.

G money
G money

So who decides who gets to vote on the tip share issue?

Can I vote to get a share of what Bill Gates earns?

No employee should have to share what customers tip them.

Anne Marie
Anne Marie

My husband has been an employee of Cafe Gratitude for as long as Sarah Stevens, and one of the things I've been most proud of about his workplace is the way they share tips. 

I admit to a certain bias:  In the past I was a line cook at a 4 star restaurant, and the inequity of wages between the front and back of the house was crazy.  I worked 8 hours/day in a 130 degree kitchen, getting burned, cut, straining my back and working my ass off to make food for about $80 a day.  The servers would work for about 6 hours, swan around, visit the tables two or three times a night (taking the order and dropping off the check), while the bussers and food runners and cooks did all the work, and the servers walked out the door with $300-400/night   It's blatantly unfair, and one of the worst things about the restaurant industry, in my opinion. 

Cafe Gratitude pays their servers a much better hourly rate than other restaurants ($11-12/hour rather than minimum wage), and before people are even interviewed for a job there, they are informed about the tip-sharing policy.  The working atmosphere there is of total teamwork, and many people are scheduled to work more than one position, as there is no difference in wages between cooking, bartending, hosting and serving.  I think the lack of hierarchy provides a much better atmosphere for the employees and for the customers, as everyone is committed to serving people. 

In the latest vote, the servers were given several options to choose from, and if they crunched the numbers, getting "all" of their tips, wouldn't necessarily mean they would make more money, because their hourly wage would be lower, and they would be affected much more by whether a shift was slow or busy.  Currently tips are pooled for the whole day and divided according to how many hours a person worked.  So, not only does "sharing" make a huge difference for all the other employees, it isn't even necessarily a financial detriment to people. 

It's not surprising to me that the servers voted to be generous and keep the tip sharing the way it is.  I can't think of a more fair or equitable arrangement. 

If you don't like the way it is, don't choose to work there.  If you think this kind of arrangement makes Cafe Gratitude a weird or cult-like place to work or eat, don't work or eat there, but if you do go there, notice the way everyone interacts with each other, notice the teamwork, and ask a server what they think.  I bet they would be happy to tell you how satisfied they are. 

George
George

No one should have to agree to share their tips in order to get a job.

The problem with viewing this system as something fair and equitable is, business owners can easily take advantage of such a system. While this particular restaurant is currently paying higher wages, there is no way to insure that restaurants pay higher hourly wages when they are incorporating such a system.

What this system does is it gives over the tips customers present to the owner of the business so that the owner can use the money to pay his employees. Now, while this employer is obviously not taking advantage of this type of system, many businesses across this country are taking advantage of this type of sytem.

There are two important issues being overlooked here.

The first is, federal laws clearly state that every employer is to pay each of his employees minimum wage. What this means is that employers are not allowed to use the customer's tip to pay their employees. If customers want to create pay disparity, they have every right to do so. Look at how much professional atheletes earn in this country. That's freedom.

Secondly, only when the customer is able to determine who his tip belongs to can those employees be properly protected tot he tips they have received. The only way to insure that the rightful owner of a tip is protected his tips is to view tips as the property of the employee to whom the tip was physically presented. Any other way results in there being no way to discern who the tip actually belongs to. If there is no way to substantiate who the tip belongs to, then the tips cannot be properly protected.

While there have been many people posting how fair this system is, it is obviously not that fair when someone is going out of their way to sue over the system.  Look at the evidence,"88 out of 103 traditionally tipped employees voted to continue to share with everybody," she said. "We also have people sign a voluntary tip agreement when they're hired. My guess is, 15 that voted against sharing where the ones who who are physically handed tips. The others simply want a share of what someone else has been given.

Why can't business owners keep their hands off their worker's tips? Tips don't belong to the owner of the business. Business owners and their management should just keep their mouth shut about tips. It's none of their buisness. A worker is just as entitled to private property as a business owner. It's as if business onwers want their property rights protected but want their employees to give up their property rights when they take a job.

Come on guys. Greed is good only, to a point.

George
George

Here is the truth. Business owners are stealing the tips you give workers in the service industry.

One vehicle they are using to steal the customer's tip is tip pooling. Tips are like cars. They have value, they are private property, and they can be pooled, however, buisness owners should have nothing to do with tip pools due to the fact that tips are not intended for buisness owners. Tips are supposed to be "RETAINED" by the employee.

While federal and some state laws explain that tip pooling is a practice that cannot be prohibited, what is being overlooked is the fact that tip pooling is NOT a practice  business owners have a right to practice, but rather, tip pooling is a practice that an employee who has been given tips has a right to practice.

When a customer gives an employee a tip, it is no different than if the customer gave the employee a car. Just as it would be the sole right of the employee to determine whether or not he will use his car for a car pool, it is also the sole right fo the employee to determine for himselves whether or not he will use his tips for a tip pool.

Those who say that federal laws allow tip pooling among certain types of employees are lying.

Federal laws would not attempt to enumerate who the customer's tip belongs to in such a manner.

While federal laws state that nothing in this subsection shall be construed to prohibit the pooling of tips among employees who customarily and regularly receive tips, it must be understood that the law is not suggesting that tips can legally be taken away from an employee so that the tips can be shared among all employees who customarily and regularly recevie tips. What the law is saying is that an empoyee who customarily and regularly receives tips directy from customers cannot be prohibited from pooling his tips.

The reason federal laws have clarified the fact that an employee who customarily and regularly receives tips directly from customers cannot be prohibited from pooling his tips is, the previous sentance of this same statute could be misconstured as suggesting that an employee is prohibited from sharing or pooling his tips.

29 USC section 203(m) states that "all tips received by the employee are to be retained by the emplloyee" The reason being, section 206, minimum wage, explains that every employer shall pay each of his employees mnimum wage. If it is not insured that the employee retains his tips, his employer could use the customer's tip to pay the employer's minimum wage obligations, which in turn, would contravene the requirement that every employer pay minimum wage at the required rates.

To put it more simply, federal laws do not allow employers to use the tips customers are presenting their employees to pay their minimum wage obligations. The intent of the Fair Labor Standards Act was to insure that every employer pay each employee minimum wage. If there were no laws to prevent employers from using the customer's tip to pay their employee's minimum wage, employers could contravene federal law.

To insure that every employer pay his employee's minimum wage, the FLSA included provisions to insure that employers could not get around, or contravene the requiremtns of the Act and use the customer's tip to pay their minimum wage obligations.

The problem was, while federal laws clearly stated that all tips received by the employee are to be retained by the employee, some employeees might misconstrue the law as prohibiting them from sharing or pooling their tips with other employees.

The word "retain" is defined as to keep in one's possession or for one's use. If an employee where to errantly construe section 203(m) as meaning that an employee must keep all his tips in his possession, then he might errantly be led to believe that it was unlawful for him to share or pool his tips with other employees.

When section 203(m) states that nothing in this subsection shall be construed to prohibit the pooling of tips among employees who customarily and regularly receive tips, what it is explaining is that the previous part of the law that say all tips received by the employee are to be retained by the employee should not be misconstrued as suggesting that it is unlawful for an employee to share or pool his tips with other employees.

The law is NOT suggesting that it is legal for a employer to confiscate and control the tips an employee has received.

The law is NOT suggesting that certain types of employees are eligible to share in any tip a customers presents.

The law is NOT suggesting that employers cannot be prohibited from requiring that employees pool their tips.

What the law states is that all tips received by an employee belong to the employee. As such, the employee may use his tips however he chooses.

In fact,  federal regulations substantiate this correct reading of federal law by defining tips as "money belonging to an employee which he may use as he chooses free of any control of the employer. Please see, CFR 531.52

Sarah Stevens is justified in her attempt to retain her tips. Her employer should not be telling her how her tips must be used. According to federal law, all tips received by Sarah are to be used however Sarah chooses to use her tips. If Sarah chooses not to use her tips for her employer's  so-called tip pool, then federal laws dictate that her employer respect her right to do what she wants with her tips.

Tina Rieman
Tina Rieman

I am a Cafe Gratitude employee as well. As a server, I have enjoyed over four-and-a-half years of working there and sharing my tips. Our food is served with love. It is also made with love. If you enjoy your experience, you can thank the one who brought the food to the table, the one who put the food on the plate, the one who made the food, the one who made your drink, the one who washed the dishes, etc. Many times customers thank me in beautiful ways - verbally. I often share those kind words with my co-workers. Every day customers thank me with tips. These, too, I gladly share with my co-workers. We are a team of people who are in service to our wonderful customers. We agree to share tips when we get hired. And we have voted to keep this policy. Just last week a very healthy majority voted to keep this policy. And only the people who earn tips got to vote, making it a fair and legal vote. Tip sharing (and even our version of tip-sharing) is completely legal and in utmost integrity. It's one of the things I love about working there.

I am honored to work for such an amazing company. I am saddened that some folks are unhappy with any situation at Cafe Gratitude (either as a customer or as an employee). It is my/our intention to be of service, in love, all the time.

If you haven't been to Cafe Gratitude in a while, please come check us out again. A couple months ago we decreased all of our prices by an average of 24% (!) and added more fabulous menu items. We are as committed as ever to serving 100% vegan, 100% ORGANIC food, with love. This serves the planet, and it serves our bodies. And beyond all of that, it serves our souls.

Thanks for listening. And thank you for your kind support.

Tina

P.S. Be Love Farm (a separate entity) sells eggs.  Cafe Gratitude does not sell eggs.

Lifesweet
Lifesweet

Sarah and her wait-staff colleagues will be the only ones on the hook when the tax person comes calling,so I agree with Sarah.  Unless Cafe Gratitude has special arrangements with the IRS and everyone pools wages and profits, then wait staff should be able to keep their own tips.  Note, not all wait staff are equal in knowledge, ability and charm.

Kyle Rasmussen
Kyle Rasmussen

She did not vouch for an individual tip system, only taking the central kitchen and shift leaders.

Righteousliving
Righteousliving

The bigger picture includes the Landmark Forum... the racist hiring and firing practices Sarah and I have witnessed over the years, the way they act like it's some kind of  "Workers Collective" when it is a privately owned company ! ALL KINDS OF HYPOCRASY GOING ON. They are not truly a Vegan operation, because they sell the eggs from their farm's chickens, AND at the Cafe Gratitude "Be Love" farm... they are using their Personal Feces as COMPOST for the Vegetables (lettuce, etc) they grow and serve in the restaurants !!! That is Surprising !!! This "Tip Pooling" lawsuit --- which is over the way they've asked Sarah to be like a Sharecropper !, --- is really only the tip of the iceberg about this place. QUESTION "CAFE GRATITUDE" !  Support my friend, Empress Sarah, in her quest for Justice. This is REAL.

Lynae Zebest
Lynae Zebest

If you don't mind my asking, what do you think they should do with the eggs? What do vegan farmers do with eggs or dead livestock in general? Do they just throw them away? Bury them? Feed them to other non-human animals? 

Or is the issue about SELLING the eggs, vs. giving them away?

(I'm really not asking to be a jerk, I genuinely want to know.)

Righteousliving
Righteousliving

"Cafe Gratitude" cannot call themselves a Vegan operation while secretly selling animal parts ! The food and drink they serve is also not necessarily - or entirely - Health-Promoting. Their overall purpose in opening the restaurant was to "play a Game" based on Landmark Forum rhetoric, etc. --- the type of cuisine was an afterthought, the collective-like intention not grounded in the reality of what it takes to create a worker's co-op (Other Avenues & Rainbow, for example).  I actually do not even know Sarah Stevens personally, only have seen her working there, greeting customers with the best smile.  However, I am friends with 2 beautiful Black men who were each treated terribly by the company "Cafe Gratitude" and ended up leaving. One went to work for the Berkeley locale, the other went to work at the now-defunct Irving Street locale. I Am For Real, Health-Promoting Vegan Restaurants. I Am For Workers-Rights. I Am For Treating Black People with Real Respect.

Kyle Rasmussen
Kyle Rasmussen

They dont sell them in the restaurant, so isnt the restaurant still vegan?

definably, vegan does not mean healthy, it just means animal free. oreos are vegan, but theyre definitely not healthy (as long as youre not one of those bone char fanatics)

Also, if you want to get technical, veganism also stands for crueltyfree of the animal, but there is still the human animal that is cruely subjugated by a private operations manager or owner.

Btw did you mention that they were black men because of racism?

springs
springs

im always astonished when someone sues cafe gratitude...

Steve
Steve

The vote Gilbert talks about was between including supervisors in the tip pool or losing health insurance.

Dreux Ellis
Dreux Ellis

I am a current Cafe Gratitude employee and am proud to be part of an organization that pays WELL above the industry standard wage (average $11-12/hour as opposed to the minimum wage offered to servers in most restaurants), plus the tips that are so generously (determined by a democratic employee vote) shared by all employees in a daily act of gratitude (both for the giver and the receiver) that breaks down the traditional and unfair model of dividing servers and kitchen staff into haves and have nots. In addition, I am also grateful and proud that this is a company that offers health insurance coverage to ALL of it's 200 plus employees in the Bay Area, more than half of whom work outside of San Francisco (the only location where it is legally obliged to do so). All this AND I get to work in a conscious environment that serves the most kick-ass 100% organic, vegan food on the planet. Can I hold space for this employees upset and her awakening? Absolutely. I can even be grateful for it.

pennielane920
pennielane920

@Dreux Ellis Hi I am conducting my thesis on Cafe Gratitude and its unique organizational structure.  I would love to get your perspective if you would be willing.  It is completely anonymous.  I just want to portray Cafe Gratitude in the most genuine way and more greatly understand how it works.  Thanks!

Here is the link to the survey: http://www.proprofs.com/survey/t/?title=rzrps

Please forward to the link to other employees you know who would be interested in helping out, thanks!

WannaBeKoolaidDrinker
WannaBeKoolaidDrinker

Druex you drank the koolaid.  

They got you hooked with their "above average wages", "health care benefits for servers and waiters", "pay by donation Gratitude Bowl so someone in a pinch can eat a good meal", "planet friendly practices", "asking employees what they think", "encouraging people to "Be Love" regardless of circumstances"...

You should leave...  (And recommend me for your job)    

MattMihaly
MattMihaly

Totally irrelevant that it's "voted" on. If they all voted that sexual harassment is ok, would that make it ok?

The company has no right to take her money from her to distribute to other people just because other employees voted for it.

Unicorn_lover_69
Unicorn_lover_69

There is no shortage of restaurants a server in SF could find employment at. If this Sarah Stevens has a problem with their tip pooling, she should find another job. 

MattMihaly
MattMihaly

So because Sarah Stevens is asking that the law be enforced, she should find another job?

Glad you're not on the jury for sexual discrimination cases against Walmart. Should those employees just find another job too?

Kyle Rasmussen
Kyle Rasmussen

I believe yes they should. there is a clear difference between cafe gratitude and walmart, where cafe gratitude runs on a collective process for their tip sharing method. If she does not agree, then she is a minoritarian and subverting the collective process.

I do not agree with how much she is tipping out, but if the majority thinks it is fair and voted on it, then maybe she should find a place that she better fits in.

bsaunders
bsaunders

When it comes to following employment laws or not, there is no difference between Cafe Gratitude, the local youth development nonprofit, Walmart, or Monsanto. I'm really sick of nonprofits and other "cause"-related businesses claiming that their mission excuses them from treating employees decently. 

It's not only hypocritical, it's illogical. Corporations don't shower money on employees because they make profit; they offer the minimal compensation it takes to compete with other employers in the marketplace for the people with the skills and talents they want. It is merely lazy and predatory to expect people to "donate" their labor because the cause is good. For that matter, if this was legitimate, pharmaceutical companies could claim that their drugs save lives (sometimes they do) and therefore employees should work for low pay and poor benefits.

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