Split Tips Between Employees

Split Tips

For party hosts, tips are fantastic. Even though party hosts aren't paid like typical servers (who make almost all their money from tips), tips are still a great incentive - and a $20 tip is a big deal to a 17 year old kid. But the party host isn't the only person responsible for providing a great experience, and therefore shouldn't be the only person who gets the tip. Instead, split tips evenly between all staff members working that week. This tends to be a controversial topic with a lot of operators. I'll make my case, and I think you'll see why this is important.

Everyone working at the facility makes a contribution to the party experience; the party host, the attraction operators, the food and beverage staff, redemption employee, etc. While the party host may have the title of being "in charge" of the party, every staff member contributes. But if tips aren't split, the party host takes full credit for a good experience, and full blame for a bad experience. The rest of your team could work their butts off and watch the party host receive an awesome tip. They all contributed, but got nothing in return. Is that really fair? Or your party host could provide an amazing experience, but everyone else slacks off. This results in a poor tip for the party host, even though he or she did a great job.

When you split tips evenly, everyone is incentivized. The entire staff is eligible for tips (almost like a bonus) and it costs you nothing. Everyone knows they need to be at their best in order to provide a great experience. This helps ensure that no individual will slack off, because they know their own paycheck could be affected.

How It Works
So how exactly is this process handled? First, all tips should be reported to management and put in a pool. That pool is added up at the end of a week and split between all staff members as an hourly rate. I know what you're thinking: "But wait! Employees can just pocket the tip!" Sure, but you'll have a policy in place which states if an employee is caught pocketing a tip, he or she is fired. No exceptions. The great part about this policy is that it has a built-in system of checks and balances. If an employee sees someone else pocket a tip, he or she is inclined to report it to management because it's money taken from their own paycheck. Nobody will let another person pocket a tip when it affects everyone.

Here's an example of how this tip money math would work in a given week. These are fairly conservative numbers, and obviously you can substitute in numbers that make sense for your business.

30 parties
$15 average tip per party
300 man hours worked

30 x $15 = $450
$450 / 300hrs = $1.50/hr

With this tip pool, all staff members got a raise of $1.50 an hour, and it didn't cost you a penny. At a facility I used to operate, it was common to see hourly tip rates exceed $3.00.

If you split tips between all staff members at your entertainment facility, it creates an environment of cooperation; everyone has an incentive. This results in better service for your customers and better pay for your staff. If you disagree with this system, let us know! We'd love to hear how your handle tips and how your employees like your system. Email us at marketing@partycentersoftware.com.

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