Tip-Out Policy Generator for Canadian Restaurants
Tipping is governed provincially. In Ontario, the Employment Standards Act bars employers from withholding tips, allows tip pooling, and generally stops owners and directors from sharing in the pool.
Tipping rules in Canada
Tipping is governed provincially. In Ontario, the Employment Standards Act bars employers from withholding tips, allows tip pooling, and generally stops owners and directors from sharing in the pool.
- Employers can’t withhold tips
- Under Ontario’s Employment Standards Act, an employer cannot withhold, deduct from, or make staff hand back their tips, except where the law requires it (such as tax) or to operate a tip pool.
- Tip pooling is allowed
- Employers may collect and redistribute tips among some or all employees. Owners, directors and shareholders generally cannot share in the pool — narrow exceptions apply where they routinely do the same work as the staff sharing it.
- Provinces differ
- Ontario is the example here; Quebec, British Columbia, Alberta and others have their own rules. Confirm the legislation in your province before setting a policy.
Summary for general guidance only — not legal advice. Confirm the current rules for your specific situation.
Build your policy
Support roles (from your calculator)
- Bar5%
Describe who splits the remaining pool. Leave blank for “the team”.
Copy pastes clean, unformatted text. Print keeps the letterhead.
Preview
BzzTip-Out & Tip Pool Policy
[Business Name]
This policy explains how tips are shared at [Business Name]. It applies to all tipped shifts and is designed to be transparent and consistent for the whole team.
1. Tip-Outs (Off the Top)
At the end of each shift, the following support roles are tipped out first, as a percentage of total tips:
- Bar: 5% of total tips
These amounts are taken off the top before any remaining tips are pooled.
2. Pool Distribution
Whatever remains after tip-outs is pooled and divided among the team in proportion to the hours each person worked that shift. The pool is divided by total hours to give a per-hour rate, then each person is paid their hours at that rate.
All payouts are calculated to the cent so the shares always add back to the total collected.
3. Eligibility
Managers, supervisors, and owners do not keep or take a share of employees' tips. Tipping rules vary by country and, in the United States, by state — this policy follows the applicable law where we operate.
4. Timing
Tip-outs and pooled tips are reconciled and distributed at the end of each shift.
Acknowledgement
By working tipped shifts, team members acknowledge they have read and understood this tip-out policy.
This document is a template to help set expectations and is not legal advice. Tip-pooling and tip-credit rules differ by country and state — confirm your policy complies with the law where you operate.
Generated by Bzz · bzz-app.com
Saved on this device — edit anytime and reprint.
A smoother shift, fairer tips
Bzz is a free digital buzzer for restaurants and bars. Guests scan a QR code and get pinged when their table’s ready — so you turn tables faster and your team earns more to share.
Questions
- Can an employer withhold tips in Canada?
- In Ontario, no — the Employment Standards Act bars employers from withholding or deducting tips except where the law requires it or to run a tip pool. Other provinces have their own rules.
- Can owners share in a Canadian tip pool?
- Generally not. In Ontario, employers, directors and shareholders cannot share in a redistributed tip pool, with narrow exceptions where they routinely do the same work as the staff sharing it.
- Do I have to re-enter my staff and percentages?
- No. The generator reuses the roles and percentages you entered in the tip-out calculator (saved in your browser). If you haven’t used it yet, it starts with a common example you can edit.
- Is this Canada tipping summary legal advice?
- No. It’s a plain-English summary of the named law with a link to the primary source, provided for general guidance. Confirm the current rules for your specific situation before setting a policy.