Halifax advocacy group urges Nova Scotia to ban ‘tip theft’

Nova Scotia is the only province in Atlantic Canada without legislation protecting workers from so-called “tip theft”, and a Halifax low-wage advocacy group has launched a campaign to change this.

In tip theft, employers take tips left by customers for service industry employees, and use them to boost profits, cover overheads or simply pocket them, said Lisa Cameron, executive director of the Halifax Workers Action Centre.

Most service industry workers, such as servers, bartenders, and cooks, earn minimum wage. Cameron said they rely heavily on tips to earn a decent income.

Along with an awareness campaign, the Halifax group launched a survey asking the public about tip theft and their tipping habits in general.

“I think it’s kind of a good idea, and it’s just a matter of right and wrong,” Cameron said. “The majority of people we surveyed didn’t know that tips weren’t the protected property of employees until they saw the campaign.”

She said most respondents said they always, or almost always, tip when asked, assuming the money goes directly to the employee, not the employer.

“The thought of that money going into the boss’s pocket is offensive to both the employees and the customer,” Cameron said.

Even the Restaurant Association of Nova Scotia, an industry group, condemns the practice. Executive Director Natasha Chestnut said in an email to CBC News that the organization recently held a webinar on employers’ rights regarding tips.

Looking for PEI

Most provinces in Canada have strict laws against tip theft. Prince Edward Island, for example, bans it altogether.

Section 17.1 of her Labor Standards Act says, “Tips and gratuities are the property of the employee to whom or for whom they are given.” Article 17.2 states that employers are not allowed to withhold tips intended for an employee or use them as part wages.

Cameron believes this is the type of standard Nova Scotia should apply, describing PEI’s laws as an “example of excellent lawmaking”.

Courtney Morrison, who previously worked in the service industry for 10 years, has dealt with tip theft. As a banquet server for a large Halifax hospitality group, she said customers would pay a flat rate for the event, then add an additional 18 percent in gratuity.

But according to Morrison, she never saw a penny of that 18 percent. She was told that the tips would go to things like staff parties, something that was of no use to her when she was trying to earn money to pay for college.

“So it’s not really helpful to me that you throw the occasional staff party at a facility that you operate.”

A ‘manipulative business model’

As a bartender at a restaurant owned by the same company, Morrison said staff were expected to contribute money from their tip jar to the company’s debit and credit transaction costs.

This, according to Cameron, is an example of employers tipping to cover overheads.

“I just think it’s a really manipulative business model,” Morrison said.

Often, she said, young people who work in places like this don’t know their rights as workers.

“Sometimes it takes you a while to realize you’re being scammed by your boss,” she said.

Hoping to help others going through similar situations, Morrison founded her own advocacy organization, Nova Scotia Hospitality Workers United. The group seeks to increase transparency and build community within the hospitality industry.

A Nova Scotia Department of Labor spokesperson told CBC that while it is aware of the tip theft concerns, there is no plan to address the practice through the province’s labor standards code.