Merchant Account Chargeback on Employee Tips

My friend works as a server at a new restaurant and noticed that at the end of the shift her tips were being reduced by a little. When she inquired they told here that the company is charging her back for the cost of the merchant account fees because some of the tips originated from credit card transactions.

This sound fishy, and would like to find out the legalities of this practice.

Thanks

Credit card companies charge about 5% of the transaction amount. Thus you should be prepared to lose that percentage of the charged tips. Your restaurant must be having some problems to take that back. Work with them.

Wouldn't the proper chargeback amount be almost impossible to correctly calculate though? There are different rates for Visa/MC/AMEX/Discover, ect....so is it legal to use an estimated cost to charge back to employees?

Tipping points: Credit-card fees have made the tip a touchy issue in restaurant business - Taste: Food news, restaurant reviews, recipes and more - Cleveland.com

The chargeback amount is typically 1.5 to 3 percent ( according to this article on the subject).

Perhaps reading through this article can assist you. I don't see how it is illegal, although it certainly does not seem fair.

Now why would Grace OR the poster think that a restaurant should trace each and every transaction to determine how much they should deduct from the wait tip?

They would most likely average the percentage against the total tips on cards or just total tips... and my AMEX charges 5%... and deduct it from everybody's charged tips or maybe just everybody's tips.... just like some restaurants cull out a percentage for the folks who work in the back... the idea is to be fair to all INCLUDING THE RESTAURANT INVESTOR.

Perhaps a better question might be WHERE did Grace say that ".......a restaurant SHOULD TRACE each and every transaction to detemine how much they should deduct from the wait tip."

ASSumptions. Again.

THE POSTER suggested a difficulty in calculating percentages----not I. '

Very careless of you. (big surprise there)

I said the chargeback is typically 1.5-3 %(notice this is not an arbitrary 5% amount pulled out of my, well, hat like you did--but rather the correct percentage I looked up to make sure was accurate). Where did I say ANYTHING about TRACING transactions?

The answer is I DIDN'T.

Grace, I have to admit, I seldom read your URL postings. I always suspect that you have put a bug out there somewhere to infect my system.

You had a problem with my saying it was 5%... but I know AMEX charges that and I also know that my BOA card that pays me 3% would be charging more than you quoted from that article... so what is your problem? Not everything you can find on the internet is accurate. But now, You choose to complain that I have preempted your next complaint by explaining WHY and HOW the restaurant does its business... and that it is done in all fairness.

But Grace STILL COMPLAINS. Get this... IT IS NOT ALL ABOUT YOU. In fact, it is seldom about you... but the only way to stop it from being directed at you is to stop being a harpy.

Todays legal definition:

Slander is an untruthful oral (spoken) statement about a person that harms the person's reputation or standing in the community.

What you have done, alleging I am using this forum to distribute malware is slanderous (libelous--written slander) is an actionable tort. I suggest you remove your comments pertaining to the same or I will ask the adminstrator of this site to remove them as a terms of service violation.

I do what I do here because it makes a difference in people's lives and it has resulted literally hundreds of notes from people thanking me for helping them. If my private message box is full, they email me. You want to be right THAT badly that you'd go to such lengths to keep people from reading the truth for themselves by your fearmongering? The only thing that makes a difference in this forum is the TRUTH. And I provide the truth for people to read it for themselves in an attempt at keeping them from being mislead by your error.

I think it is truly a tragedy that you want SO BADLY for people to NOT know the truth about the error in your postings that you would stoop so low as to accuse another poster of a criminal act of distribution of harmful malware.

Shame on you.

You died before Christmas but went to the KEYS last month?? And I'm pretending? ROFL!!

Only one of us has been candid about our name, our gender, our appearance, our education and heck, even being alive or dead.

I find it hilarious you would think I am the administrator of this site--and I categorically deny such a silly claim.

Hey--how's yer tires? ROFLMAO

ROFL! Taken? HOW does asking you why you said you were DEAD translate into "ARE YOU TAKEN?"

Excuse me a second---"EWWWWWWWWWW!" Blech.

I will tell you why I am interested in your mistruths.

IN this tread alone, you called me a liar and pretender.It's relevant when you call me vulgarities, when YOU are using other names to say you DIED last year---and I'm a pretender? I am the only one who has been extremely candid about everything from my gender, to my education. YOU have said you were male, then female. Dead, then alive. It's STRANGE.

In a forum where every other word out of your mouth is calling me untruthful, unethical, etc. You pop up here and inform everyone (using another name) that THIS name you are using now DIED last year. But suddenly, you are alive and well.

You expect eyebrows not to be raised?

You have made HUNDREDS of comments in this forum ALL unsubstantiated. And, when asked to clarify these statements YOU WILLINGLY MADE on your own, you snarl and ask ME something about MY personal life. Even in another thread, the ADMIN removed your comments suggesting I was "hooking up" with posters--and it was a WOMAN--all because we were talking about enjoying our CARS. You see inappropriateness in EVERYTHING. Asking you about your comments saying you are DEAD has nothing to do with being "taken" or being in a relationship. Strange how you make everything about "THAT".

And, since you asked, the answer is NO, I have never 'shacked up' or lived in immorality with anyone. My husband was the first man I had ever been with and remained with until his death. My husbands best friend was living WITH US while my husband was alive and stayed with me afterward to help me with the children and for us to help him (since shortly thereafter he was injured in a work accident and was subsequently permanently disabled). Speaking lovingly of him? Of course. He meant the world to me then and even more now. Having an illicit relationship? Nope.

Nice segue, but you never answered. Why did you, as DENNYIT, say that DONALLIE was your husband who DIED last year? Then last week you said, "Could it be that DONALLIE IS FEMALE and DENNY IS MALE?"

If you don't want people to ASK, DON'T make statements such as those.

If you make statements in a public forum and they don't add up, don't be surprised if people ask you to clarify them, that's all.