April 9, 2025
Samantha Poole, Membership & Business Development Director
What is the difference between a tip pool and tip sharing?
‘Tip Pooling’ is when a group of employees in the same job category, such as the servers in a restaurant or bartenders in a bar, decide they want to combine their tips together each day and then divide them among pool participants. ‘Tip Sharing’ is when an employee voluntarily chooses to share a percentage of their tips or “tip out” another employee. An example of this is a server tipping a bus person for assisting them clearing their tables.
Does NH allow tip pools?
Yes, NH does allow for tip pools as long as it is a valid tip pool and is agreed upon by all employees engaging in a tip pool. Employers can set up tip pools if employees request them, but they cannot require or coerce employees to participate.
Who can receive tips in a valid tip pool?
Valid tip pooling is among employees who customarily and regularly receive tips such as waitstaff, bellhops, valets, bussers, and service bartenders. A valid tip pool may not include employees who do not customarily and regularly receive tips such as dishwashers, cooks, chefs, and janitors.
Can managers or owners participate in a tip pool?
Generally, no. Owners, managers, and supervisors cannot be part of a tip pool. But, managers can keep any tips given directly to them as tips are ownership of the employee who received them.
Can others who assist the tipped employee be part of the pool?
No. Generally, non-tipped employees cannot be a part of a tip pool as they are not in the same job category with the tipped employees in the pool who would be permitted in a tip sharing arrangement. However, NH RSA 279:26-b III allows employees participating in a tip pool to agree, voluntarily and without coercion, to provide a portion of the common pool to other employees, regardless of job category, who participated in providing service to customers.
As a manager/owner, can I suggest a tip pool?
Yes, no employer is precluded from administering a valid tip pooling or tip sharing arrangement at the request of the employee, including suggesting reasonable and customary practices, as well as mediating disputes between employees regarding a valid tip pooling or tip sharing arrangement. That being said, the employee may not be forced to participate in a tip-sharing or pooling arrangement.
Can an employee change their mind about participating in a tip pooling arrangement?
An employee in NH may, at any time, refuse to participate in a tip pool or sharing situation. This includes if an agreement is made by the group, as during any shift, an employee may choose not to participate in the arrangement. An employee cannot be disciplined or retaliated against for refusing to participate in a tip pool.
What can I do if I have a server who will not tip out and another employee complains?
No employer is precluded from administering a valid tip pooling or tip sharing arrangement at the request of the employee, including suggesting reasonable and customary practices, as well as mediating disputes between employees regarding a valid tip pooling or tip sharing arrangement. That being said, the employee may not be forced to participate in a tip-sharing or pooling arrangement.
Can I refuse to hire an employee that does not want to participate in a tip pool or sharing arrangement?
No. If you institute a tip pool, even if your entire staff agrees upon it, then you cannot discriminate against prospective employees if they state that they will not contribute to the tip pool or sharing arrangement. Informing an employee that they are required to contribute to an established arrangement upon being hired may be considered coercion.
If my employees make higher than the federal minimum wage, then can I require a tip pool?
A tip is considered the sole property of the tipped employee regardless of whether the employer takes a tip credit. Meaning that even in cases where the employee is making federal minimum wage or above, they still own the tips that they receive.
What are some alternatives to tip pools in counter service businesses?
Some alternatives are to either not accept tips, rotate employees on the register so all employees have a chance to accept tips, or work with your employees to find a tip sharing situation that all employees agree with.
Is there any legality with servers accepting tips through 3rd party apps like Venmo?
Tips are always the property of the employee and there is no State of New Hampshire labor law limiting how they are to be received. Employers can set polices. These policies can mandate that no tips are to be accepted or they can state how they are to be reported to the employer. However, once a tip is accepted by an employee, it is the property of the employee and cannot be taken away.
State v Federal Law Differences:
Please be aware that state law is more strict on this subject than federal law. Employers must always follow the stricter law in circumstances that the state and federal law differ. Below are some examples of these differences.
In some circumstances under federal law, tip pooling can be required, but not in NH. In NH, tip pooling must always be voluntary, and never the subject of coercion or pressure from the employer.
In NH, only tipped employees within the same job category may participate in a tip pool.
State Resources:
Federal Resources:
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA)
Fact Sheet #15B: Managers and Supervisors Under the Fair Labor Standards Act (FLSA) and Tips
Restaurants and Fast Food Establishments under the Fair Labor Standards Act
This is not to be used in lieu of legal guidance but to assist with an organization's ongoing training. Please review your legal obligations with your legal representative and see NH and US DOL documents linked for further information. This document was prepared April 2025 based on information available virtually through the NH DOL and US DOL online resources.