Tips and starting/closing drawer question

[BSkiesCreamery]

We do not currently use shifts but are looking to begin doing so in the near future so that employees can clock in/out. We are an ice cream shop and our employees receive tips. Currently, when we open the store we "start drawer" and as employees leave, we pay out including their tips. We do this by going to the current drawer on the POS and paying out the tips they earned via credit card transactions. Then at the end of the night we close the drawer which shows us the total that should be in the register (cash for purchased items minus the tips we paid out to employees in cash).

It looks like once you start using shifts, the system automatically splits up the tips based on whatever option you choose (pool them vs. giving it to the logged in employee, etc.). Since the system will now be adding the tips directly to their timecard, I assume this means that we no longer pay out the tips every shift and instead simply close out the drawer at the end of the day with the tips left in there. Is that accurate?

Also, i keep reading that tip pooling is a "plus plan" feature however we are on the free plan but still have access to selecting pool tipping "pool tips by hours worked". Is that normal or did I misread the plan options.

Appreciate all of the help.

[svanbrunt]

@BSkiesCreamery Good questions

1. Almost all of the tip distribution methods (i.e., how Shifts calculates what tips are owed to each employee) should be compatible with how you want to handle actually paying out those tips.
* If you still want to pay out tips in cash at the end of the day, that should likely still be possible (as long as you know what each employee is owed at the time they are leaving).

* Or if you want to wait until the end of the pay period and pay them their tips in their paycheck, that also works.

* And if you did use Square Payroll, both of those tip payout / tip import methods are supported. When you import tips, you can mark those as "already paid out in cash" or "included in the paycheck".

2. Tip pooling is in fact included in Shifts Plus.

* It looks like you started a free trial for Shifts Plus today (that is the default behavior when you get started with Shifts), so that is why you see the option to select the tip pooling options.  

[BSkiesCreamery]

Appreciate the quick response. Yes, i started the trial today because it is the only way Square lets you select the free plan (this is a really shady move on Square's part, you should not be forced to opt in to a trial in order to select the free option). Anyway, i immediately cancelled the trial and now my subscription shows the "Free" option however, it looks like you all still give access to the plus options for 30 days.

Anyway, if i am understanding correctly, on the free plan, the only option is to "tip directly" which per the description, assigns the tip for the transaction to the team member that collected the tip. I assume this means the team member that is clocked in? In either case, that would not work for us as we may have multiple employees working at the same time and the tips for their shift should be split equally. For example, if they each work the same 2 hour shift and 100 is collected in tips, the tips should be split 50/50 between the two of them. Is there a way to do that in the free plan or hell, even turn off the tip function altogether so I can keep tipping them out the way we are doing it now?

[svanbrunt]

1. Correct that any of the tip pooling options are limited to the paid tier.

2.  On the free tier, the only option is 'Tip directly'

* This will attribute the tip to the team member that is *logged* into that point of sale at the time of the transaction. This would be if you have 'passcodes' turned on under Security settings on point of sale, so that each transaction is attributed to a team member.

* Note: this is different than being clocked in at that time (i.e you can be clocked in but not working the POS).

3. If you don't want tips to be attributed to a given team member (so you can pay out the way you were before), you have a few options
a) Just ignore the data in Square.  The data in Square will look different than what is actually paid out, but employees will still receive what you want them to.

b) Use Team Passcode. The POS could be logged in via the more generic team passcode and all tips will be 'unattributed'.

To your last point, we do have on our plans the ability to just toggle off tip tracking entirely, which would have the same effect of just marking all tips as unattributed. cc @JasonSQPM  

[BSkiesCreamery]

Thank you for the explanation. Sounds like team pass code is the way we will need to go.

• How does that work with Square payroll as far as reporting the credit card tips? Do those need to be manually entered into each employees time sheet?
• Also, is there a way to keep the team pass code but disable individual team member's logins so that they can only be used to clock in/out? By this i mean, currently, if a team member's code is 1234 and the team pass code is 4567, that team member can login to the POS using either. I want them to only be able to login using the team pass code and their personal code to only work for clocking in/out. 

[svanbrunt · Accepted solution]

Thinking about your situation more, I think your best bet would be:

1) Continue to have your team members use their personal passcode since they are clocking in on POS

2) You can just mark the jobs that team members are assigned as "tip ineligible". 

* This will have the impact of moving all tips to "unattributed team member" (i.e, it's your responsibility to attribute them appropriately)

* This will be functionally equivalent to turning tip tracking off.

3) Then when you run payroll, you can have tip importing off, and just manually enter the tips (which are getting paid out daily in cash) into the "tips already paid in cash" column.

Hopefully that makes sense!

[BSkiesCreamery]

Alright, i think I am following what you're saying. Based on your recommendation, could I do the following?

1. Keep the team pass code as the main way employees login to the POS/use the POS. This makes it so that if multiple people are working, they don't need to continually log in/out on the POS if the other employee was logged in (we only have 1 POS currently).
2. Each employee keeps their personal code so they can clock in/out for time keeping purposes. I would also update their profiles so that they are 'tip ineligible' as you suggested so that tips are not attributed and I can continue to 'tip them out' at the end of their shift.

I feel like this solution keeps the best of your idea but reduces employees having to constantly log in/out.

I have not yet signed up for payroll so I am not 100% familiar with it but when reporting tips, do you just:

• Report the entire amount of tips that were received during that pay period, say 1 week, or;
• Do you report what each person made in tips in the 'tips already paid in cash' column? I ask as I am curious about the tax implications for the employees. It would also affect how we track things on a day to day basis.

I appreciate the time you are taking to help me walk through this!

[svanbrunt]

Yep that sounds right

When you do run payroll, generally you would report what each person took home in that pay period in tips. That would just impact the tax withholding for that period.