Tip Pooling for Restaurants Question!

[maribela00]

Hi everyone, is there a way with Square Payroll to define different point values for different positions. My tip pool is not equal among positions. For example a server and bartender gets a higher percentage or point value per hour than our food runners and our hosts for example. Is there a way to define this? Or is it just a pool that distributes the tips equally across board based on hours worked?

[Donnie-M]

@maribela00 That is a good question.  I do think the basic premise is it splits tips by hours worked in the tip pool.  This is from square's knowledge base:

"Manual Tip Entry
You can also manually input your employees tips when processing payroll. Click the (+) icon to the right of Gross Pay to add the appropriate pay types:

Cash Tips: The amount of tips paid out in cash. This amount should already have been paid to your employee and will not be sent in your pay run. Declaring cash tips ensures accurate tax reporting and documentation. Employee taxes will be calculated for these amounts and withheld from the employee’s pay.

Paycheck Tips: The amount of tips you want to pay to your employee(s) for the pay period. This amount will be paid to your employee(s) through Square Payroll."

So to do what you want to do can be done, but you will have to do it manually.  I currently do not use the payroll feature so I set up a system like this.  (I have included the adaptations you would need for your scenario)

1.  Run the "Team Sales" report for your location for the pay period. (Change the dates)

2. Export the report to CSV.

3.  Load in Excel preferably.  Total the column with all of the tips (I highlight and drag down to an empty cell and use autosum).

4.  Assign each position the fraction of the hour.  Servers would be 1, hostesses .25, busboys .15, etc.  Whatever their percentage is would calculate to a decimal.  Best add this to a column to the right.

5.  In the next column use a function and hit = and click on the hours worked "*" the fraction for the position.  This will give you the fractional value of the position related to the server.  You can then drag that down by the little dot on the bottom right and it will set the formulas for each person automatically.

6.  total all of these fractional hours up and divide the total tips by the total fractional hours and you will have a dollar per hour for what each whole hour is worth.

7.  The last step is to multiply this tip per hour times the fractional hour for each person ( I can share the formula for you if you end up wanting to use this unless you are excel savvy).

What you end up with is a spreadsheet that will give you the amount owed for each person based on position.  People that get no tips just get a 0 fractional modifier.  You can then use this spreadsheet to input into square payroll and split the tip pool by weighted position.  The key thing is save the sheet as an .xlsl spreadsheet not csv as csv will drop formulas.  Once you get it right once, you can then record a macro.  I use my macro and it takes 15 seconds to export the spreadsheet, hit the macro and save as .xlsl for excel format.

Yes, it would be great for square to do this for us, but you can do it and still enjoy the benefits of square payroll.

If you have any questions, I would be glad to help you set this up.

Donnie-M

[pguru2018]

I don't understand why tips that are collected for an entire pay period then paid based on hours worked is going away in April. 

I understand that the new feature will allow this to occur by day, but this creates a crazy disparity due to the volume my business brings in on, lets say a Saturday vs. a Monday; essentially penalizing my employees who work on our slow days. 

Why not just add the additional tip pooling ability instead of taking away what I am **bleep**uming a significant portion of your payroll customers who use tip pooling is using?

[sayra]

Hey @pguru2018,  

We appreciate your feedback as we transition into this new service. Our product team will have visibility to your opinion here in our Seller Community. 

I can see how this will affect your business and employees and would be happy to gather more details related to this, in case there is more we can do for you. 

We will keep you updated. 

Thanks.