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(a) The purpose of this section is to prevent the circumvention or evasion of AS 23.10.050 - 23.10.150 (Alaska Wage and Hour Act) by an employer handling, or taking possession or control of, an employee's tips.
(b) Except as provided in this section, an employer may not handle or take possession or control of an employee's tips. However, nothing in this section precludes a tip pooling arrangement to the extent allowed under 29 U.S.C. 201 - 219 (Fair Labor Standards Act of 1938, as amended).
(c) An employer may handle tips only for the purpose of
(1) delivering the cash amount of the tip to the employee when a customer provides for a tip on a credit card charge slip; or
(2) redistributing the tips to employees under a tip pooling arrangement.
(d) If an employer must pay a credit card company a fee based on a percentage of a customer's bill, an employer may reduce the amount of a credit card tip by a percentage not greater than the percentage charged by the credit card company for its fee.
(e) For the purposes of this section,
(1) "tip pooling arrangement" means an agreement under which a portion of an employee's tips is collected for distribution among certain other employees;
(2) "tips" means an amount of cash, or an amount designated as a "tip" by a credit card customer on a credit card charge slip, that is determined, and freely given, by a customer in recognition of an employee's service to that customer; "tips" does not include a compulsory charge for service that is part of the employer's gross receipts, such as a service charge of 15 percent of a customer's bill.
History: Eff. 4/7/96, Register 138
Authority: AS 23.05.060
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Last modified 7/05/2006