Some restaurants tack a “mandatory service charge” on to bills for large tables of diners, private parties, or catered events. Under federal and California law, this isn’t considered a tip.
Even if the customer thinks that money is going to you and doesn’t leave anything extra on the table, your employer can keep any money designated as a “service charge.”
The law generally considers this part of the contract between the patron and the establishment, not a voluntary acknowledgment of good service by an employee. Many employers give at least part of these service charges to employees, but that’s the employer’s choice: Employees have no legal right to that money.
David Payab, Esq. from The Law Offices of Payab & Associates can be reached @ (800) 401-4466 or by visiting http://payablaw.com