No. In Massachusetts, managers cannot take tips. The state’s Tips Act, M.G.L. c. 149, § 152A, bars any employer, owner, officer, or person with management or supervisory responsibility over service staff from keeping, demanding, or accepting any portion of a tip or service charge meant for employees. The prohibition is broad and explicit, and it applies whether the tip was cash, added to a credit card, pooled among coworkers, or collected as a mandatory service charge.
Who Counts as a Manager Under the Tips Act
The statute doesn’t hand down a single definition of “manager.” It works the other way around: it defines who is eligible to receive tips, and anyone with managerial responsibility falls outside those categories. A wait staff employee must have “no managerial responsibility during a day in which the person serves beverages or prepared food or clears patrons’ tables.” A service employee must likewise have “no managerial responsibility” to qualify for tips or tip-pool distributions.
The definition of “employer” cuts from the other direction. It reaches not just the business entity but any person whose primary responsibility is managing or supervising wait staff, service employees, or service bartenders. An owner working the floor, a general manager, and a shift supervisor whose main job is directing servers all count as employers for tip purposes, and all are locked out of receiving gratuities.
The statute itself doesn’t list every duty that crosses into “managerial responsibility.” The Attorney General’s Office has filled that gap by looking to federal regulations that define executive employees. Signals of managerial responsibility include directing other employees, making or influencing hiring and firing decisions, scheduling shifts, and assigning servers to sections.
This gets tricky with hybrid roles. A “shift lead” or “assistant manager” whose primary job during a given shift is actually serving tables can qualify as a wait staff employee on that shift, but only if they genuinely have no managerial authority that day. The moment they start making scheduling calls or directing other servers, they lose eligibility.
What “Tips” Includes
The protection covers every form the money takes. Cash on the table, a credit card gratuity, a share of a pooled tip, and a mandatory service charge are all treated the same way under the Tips Act. Any arrangement where a manager skims a percentage “for the house” or takes a cut of the pool is a violation.
Service charges get the same protection as voluntary tips. The full proceeds of a service charge must go to the wait staff, service bartenders, and service employees who provided the service, distributed in proportion to the service each performed. The statute defines “service charge” broadly to include any fee designated as a service charge, tip, or gratuity, and any fee a customer would reasonably expect to go to service staff. That broad definition prevents an employer from relabeling a service charge as an “administrative fee” and pocketing it. If a reasonable customer would look at the charge and assume it was going to the people who served them, Massachusetts law says it must.
An employer can charge a separate fee that it keeps, but only if the fee genuinely falls outside the service-charge definition. That requires telling the customer clearly, in writing on the bill or menu, that the fee is not a gratuity and won’t go to service staff. Vague labeling won’t work.
Tip Pools Can’t Route Money to Managers
Massachusetts allows tip pooling, but participation is limited to three categories of workers: wait staff employees who serve food or drinks or clear tables and have no managerial responsibility that day; service bartenders who prepare drinks for servers to deliver; and service employees in other tipped occupations, such as bellhops or hairdressers, who provide direct service and have no managerial responsibility.
No one outside those three categories can share in a tip pool. Kitchen staff, dishwashers, hosts without tipped duties, and anyone with managerial responsibility are all excluded. An employer can administer a pool for bookkeeping and tax-reporting purposes, but administering and participating are different things. The employer also cannot force eligible employees to share tips with ineligible people, no matter how the arrangement is framed.
Federal law reinforces this. Under the Fair Labor Standards Act, as amended in 2018, employers, managers, and supervisors are expressly prohibited from keeping employees’ tips under any circumstances. The narrow federal exception allows a manager to keep a tip a customer gave directly and solely for service the manager personally provided with no assistance from other staff.
Credit Card Processing Fees Can’t Come Out of Tips
When a customer tips on a credit card, the employer pays a processing fee on the transaction. Some states let employers pass a proportional share of that fee to the tipped employee. Massachusetts does not. The Tips Act prohibits any deduction from a tip, and credit card processing costs are a business expense the employer has to absorb. A $20 credit card tip means the employee gets $20.
The Tip Credit Is Not the Same as Taking Tips
Massachusetts requires employers to pay tipped employees a cash wage of at least $6.75 per hour. The regular state minimum wage is $15.00 per hour. An employer can take a tip credit of up to $8.25 per hour, the difference between the two, but only if the employee’s tips bring total hourly pay to at least $15.00. If tips fall short in a pay period, the employer has to make up the gap.
Taking a tip credit is not the same as taking tips. The tip credit counts a portion of the employee’s tips toward the minimum wage obligation on paper; the employee still keeps every dollar of tips. An employer who fails to pay the $6.75 cash wage, or who doesn’t cover the shortfall when tips are light, faces the same penalties as one who takes tips outright.
What You Can Recover and How to File a Complaint
Massachusetts penalties for tip theft are steep. Under M.G.L. c. 149, § 150, an employee who wins a claim for unlawfully withheld tips is awarded treble damages, three times the lost wages and benefits, as liquidated damages. The employer also pays the employee’s reasonable attorney’s fees and litigation costs. Treble damages are mandatory. A court cannot find the employer acted in good faith and reduce the award to single damages.
To pursue a claim, file a complaint with the Attorney General’s Fair Labor Division through the AG’s website. Tip violations fall under the “Non-Payment of Wage” category on the complaint form. The statute of limitations is three years from the date of the violation, and that clock pauses from the date the AG complaint is filed until the AG either authorizes a private lawsuit or concludes its own enforcement action. An employee can bring a private civil lawsuit 90 days after filing with the AG, or sooner with the AG’s written consent.
At the federal level, employees can also file a complaint with the Department of Labor’s Wage and Hour Division at 1-866-487-9243. Federal complaints are confidential, and employers are prohibited from retaliating against workers who file. Federal remedies include the full amount of tips taken plus an equal amount in liquidated damages, and willful violators can face criminal fines of up to $10,000. Filing with both the AG and the DOL can make sense, since state and federal law offer different remedies and the stronger result controls.