Updates to Square Payroll tip distribution?

[dkhtodd]

I was looking at the new SHIFTS section this morning and happened upon SHIFTS>Settings>Tip Distribution. I noticed that TIP DIRECTLY (Credit cards tips are attributed to the team member who collected the tip) was selected. This confused me because I don't ever recall setting that or telling the system to only give tips to the person who collected. When we set this up a year ago, tips were set to be pooled.

I continued looking around and noticed under PAYROLL>Settings>Payroll Settings that Enable Tip Importing is selected as is Pool & Split tips. This section makes sense to me and I recall seeing this before. This is how the tips should work.

My question is, which section is correct? If SHIFTS is correct, it seems as if the person who is on the register will receive the credit card tips - but that is not how I expected this to work.

Attaching screenshots for reference.

Please advise.

 

The title of this thread has been edited from the original: New SHIFTS: Did something change with Tip Distribution?

[#2]

Hi all, back again as promised with an update. First off, thank you for sharing your feedback on how the recent tip splitting changes impact your business. Our teams have heard you, and understand that having more flexibility with tip calculations is important for both business operations and employee satisfaction.

To address these concerns, we will make the following changes:

• Existing Square Payroll customers will be able to pool and split tips by workday or pay period until April 1, 2022 (extended from December 1, 2021). After April 1st, customers will have 3 options: [1] pay tips directly, [2] split tips by transaction, or [3] pool and split tips by workday.
  
  
• We will expand the existing pool and split by workday option so it is available for non-Payroll sellers. Currently, sellers who don’t use Square Payroll are unable to pool and split tips by workday. After this update, they will be able to download reports that they can upload to their existing payroll providers. 
  
  
• Once the grace period ends on April 1, 2022, the option to pool and split tips by pay period will be removed. We are working to consolidate and expand labor-related functionality within Square, and as we do so we are unable to continue supporting tip pooling and splitting by pay period. We understand this may disappoint some businesses and hope the ability to pool and split tips by workday may work as an alternative. 

Employers were not opted into the new tip splitting method automatically.

If you would like to confirm your settings and continue using the Workday/Pay Period option, follow these steps: 

1. Go to Payroll > Payroll Settings. If you still see the old settings, you are all set!
   
2. If you no longer see the Pay Period or Workday options, like the screenshot below, you may have inadvertently opted into the new tip splitting method:
   
3. If this was a mistake, and you want to switch back to Workday or Pay Period, follow these steps:
   
   Go to Shifts > Settings > Tip distribution and choose Tip directly.
   
   NOTE: You will not actually tip directly. On the next step, you will be prompted to select your actual preferred tip distribution method. This is a temporary workflow during the grace period.
   
   Return to Payroll > Payroll Settings. You will see the old Workday/Pay Period options and select your preferred method.

For those who would like to use the new feature to split tips per transaction, but have hours of operation when no one is clocked in, we wanted to highlight that you have the ability to toggle on or off the “Distribute unattributed tips equally” setting.

If the setting is toggled on, tips received when no one is clocked in will be equally distributed among all tip-eligible team members who clocked in on that workday. If no one clocked in that day, the tips remain unattributed. You can manually apply these tips at the time of processing payroll.

Thank you again for all of your continued support and feedback. We are always looking for better ways to improve our product to support your business and team. 

[#3]

Hi All! I want to thank you for raising your concerns. We completely understand the sentiments here and apologize for the disruption this has caused. We understand the sensitivity with the labor market, and how this impacts your business. We will take this back to our teams and reconsider options.

At a minimum, we can extend the grace period and provide guidance on how to still split tips by workday.  **These options have NOT yet gone away. As long as you don’t select the new “Split by transaction” option in TM, your tip calculations will not be affected.**

I hope to be back soon with some more information on this change today from our teams and give everyone a bit more insight.

[lgmbts]

The short answer is yes - that's exactly what it means.  If, on 12/1 this is the "enhanced" tip pooling tool is changed by Square, it means that you'll be required to do a manual workaround to do what the current tip pooling function does automatically.  Someone offered up a spreadsheet that they developed as a workaround that involves downloading your payroll to a .csv (something I do each payroll) and then using a macro that they developed to distribute tips.  I've not yet tried it.  That said, as a small business owner, I'm not interested in spending more time than necessary administratively, and this change counters that.  If you have not already contacted Square Payroll and let them know how it impacts you, I'd suggest doing so in addition to voicing it here on this thread.

You are not on alone on an island if you are not happy with this pending change.

[dkhtodd]

@kellyj Can you convince ANY of us that you guys are listening to us? Or is it just you guys responding incorrectly and then ignoring the comments we make?

It's as if you have some internal team that says you want us to help BETA test, but then you don't listen. AND, you don't communicate. 

Please tell the Product Manager of your Payroll product to spend time looking at the competition because making stupid changes like disallowing pooling by pay period. I mean seriously, who thought taking this away was a smart play?

For the rest of you, given I guess I will have to do this manually any way, I'd rather move my business to a competitor then have to continue dealing with changes Square makes without talking to the people that use their product,

[Donnie-M]

@dkhtodd Let me jump in here and say that I 100% believe square does actually listen to us.  I have been a beta tester for a while now and a super seller and see and try to give back on the forums.  I promise that Square is seeing this and will look at it.  I am of course a square customer just like all of you, and I have found square to be a lot more responsive than most businesses, but they guys and gals on that work for square are people and this is how we fix things by communicating.

I would ask anyone that is frustrated or doesn't agree with this or any change to make a post and clearly state why you use square payroll and how this change positively or negatively affects your business.  I truly believe square tries to make the best decisions it can, but sometimes they need our input.  I also don't know a single company that is 100% perfect all the time.

So before we burn 🔥 the farm to the ground, lets work and see what can be accomplished.

Donnie-M

[kellyj]

@dkhtodd 
Thank you and promise you are heard. I am curious if you are still seeing the setting to distribute tips and still have that as an option or if your post is just in reaction to the email. You should have this as an option now, and we're working on solutions based on this feedback. 

Promise we do hear you and are working on it.

What Donnie said is absolutely true, your voice is important, and how this impacts your business even more so. 

Like I said, please let me know if you do still see this option now, as it should be available and I will follow up with other progress from the team ASAP.

[Berolina]

These new options will not work for our business at all, we have staff working at all hours and also get online orders 24/7. 
When I called square and asked what happens to the tip that’s received when no employee is clocked in, they basically said it will be transferred to the business account and you can do whatever you want with it, doesn’t sound legit to me. 
I don’t think they understand how business operate nowadays when tips pooling is commonplace. 

[thewakezone]

This is a valid point I had not thought of.  We get mobile orders throughout the day and night.  The person on shift when the order is placed might not be the person making the product.  We get mobile orders in the middle of the night when nobody is clocked in, so those tips won't be assigned.

Square should seriously consider keeping the current tip pooling functionality in addition to the new options.  No doubt people want the new options, but they are really putting the rest of us in a bad position.

[kellyj]

@Berolina @thewakezone 

If you choose to split by transaction, there is a second toggle that shows up to allow for split the tip when no one is clocked in. See the bottom of the screenshot for the toggle.

As for the rest, we're working on it. 

[Berolina]

What if no one was clocked in that work day?

[Berolina]

We are closed two days of the week, if an employee then works one hour on a closed day will that employee then receive all tips for that 24 hour period?  

[kellyj]

Hi All! I want to thank you for raising your concerns. We completely understand the sentiments here and apologize for the disruption this has caused. We understand the sensitivity with the labor market, and how this impacts your business. We will take this back to our teams and reconsider options.

At a minimum, we can extend the grace period and provide guidance on how to still split tips by workday.  **These options have NOT yet gone away. As long as you don’t select the new “Split by transaction” option in TM, your tip calculations will not be affected.**

I hope to be back soon with some more information on this change today from our teams and give everyone a bit more insight.

[thewakezone]

Thank you Kelly.  I appreciate the recognition that this change has negative impacts our our employees and teams.  We are hyper focused on customer service, which means we are hyper focused on our team members and their well being.  Anything that impacts them impacts our customers, then impacts us.  

I hope Square can see this as an "in addition to..." solution rather than a "replacement for..." solution.

[MFNC206]

Thank you Kelly. This tip pool option was one of the main reasons we joined the Square community. Our entire staff benefits from pooled tips spread evenly through out the entire pay period. These were terms negotiated with our crew upon hire. Square needs to leave this option in place! -Bruce@MFNC

[Donnie-M]

Thank you Kelly for jumping in to help and get information to the community.  I know myself and others appreciate communication and knowing that someone is listening.

@dkhtodd @Dulcedo_Coffee @Apt9F @2ndCharter 

[Rp3]

Just want to add another voice that thinks taking away this option is a mistake. Adding new options is great but why remove the original method?

[theCdog]

In case Square is listening, please allow us to be another voice STRONGLY against eliminating pooled tips by pay period. 

Our staff are working 7 days a week, open for retail just 4, and have many staff working outside of the hours tips are coming in through the POS. We pool & share all tips over all hours with all eligible employees. Square's changes have made this impossible with credit card sales/tips. 

To twist the dagger a little more, Square is removing the credit card tips Dec. 1, going into the holidays...

I am upset that this will be the issue that requires our business to abandon Square. I have a feeling there must be a reason behind such a change (escaping liability?), however it is unclear. It is also very selfish, Square.

Regards,

Chris

[dkhtodd]

What do you mean they are removing credit card tips?

[Donnie-M]

@theCdog I think you are missing SQUARE IS NOT REMOVING TIPPING...they were trying to consolidate tip sharing into the scheduling and reporting function for everyone where before tip pooling was only available to square payroll.  Even under the new system sales that occurred outside business hours would be split evenly among the tip pool.

[theCdog]

@Donnie-M ,

Thanks for your comment. The changes Square is making to credit card tip collection & distribution are major. Unfortunately Square's two new tip distribution methods -- either tips go to the employee ringing up the sale, or tips are split among employees clocked in (yes, tips taken outside of "open hours" are to be split by employees that work on that day) -- does not allow us to fairly distribute the credit card tips to all staff members. The new system will no longer allow us to pool tips over the course of the pay period & distribute them evenly amongst all hours for that pay period. That is how we are able to do it now, and that is how our business chooses to fairly share the tip pool for our hard working staff.

I am glad the new system may work for you, but as I mentioned before, this Dec. 1 update will be the issue that causes us, and I think many other small businesses to seek out an alternative to Square.

Regards, Chris

[Donnie-M]

@theCdog Just to get you up to speed, The December 1st deadline has been extended while square works on a resolution.  

Per @kellyj , "At a minimum, we can extend the grace period and provide guidance on how to still split tips by workday.  **These options have NOT yet gone away. As long as you don’t select the new “Split by transaction” option in TM, your tip calculations will not be affected.**"

So if you use square payroll and don't mess with your settings you are gonna be good.  If you need a work around, I have a spreadsheet macro I use, because I do not use square payroll currently.

I also will not use the new system, it does not work for me.  I am advocating for square to have 3 options, pool tips and split by gross hours worked in all jobs in the tip pool, split tips by employee (this is necessary for full service restaurants and is available already in square for restaurants), and the "new" way of split by employee clocked in.  I think different businesses will use all 3.  The pool by hours worked has been the default for a "long" time already and myself and others do not want to see it discontinued.

I just want to make sure that the information is clear for you and anyone else reading your post that may not look through the whole thread.

Donnie-M

[dkhtodd]

@Donnie-M Would you mind sharing the spreadsheet you use? Thanks!

[pfb2020]

Donnie,

Can you please share the spreadsheet macro with me?