News / Toronto

Workers banned from accepting tips at Tim Hortons franchise

Instructions posted on a bulletin board said "no more tips" and that breaks will no longer be compensated “in light of the new minimum wage increase."

A Tim Hortons franchise in Scarborough has informed staff they will no longer be eligible to accept tips in the wake of Ontario's minimum wage hike.

torstar file photo

A Tim Hortons franchise in Scarborough has informed staff they will no longer be eligible to accept tips in the wake of Ontario's minimum wage hike.

A Scarborough-based Tim Hortons has banned employees from accepting tips and will strip them of paid breaks in response to a $2.40 wage hike, the Star has learned.

Employees at the franchise located at Lawrence Ave. E. and Markham Rd. have been told that as of 2018, there would be “no more tips” and that any tips “must go in to the till.” The instructions posted on a bulletin board also say breaks will no longer be compensated “in light of the new minimum wage increase,” according to documents seen by the Star.

Employers can decide if tipping is allowed in their businesses. If tipping is not accepted, the employer should make it clear to the customers that tips and other gratuities will not be accepted by employees or the employer, according to the Ministry of Labour website. If gratuities are permitted, it is illegal to withhold tips from workers, following changes to the Employment Standards Act introduced by the Ontario government in 2015. Employers can only withhold tips if they are collected and re-distributed later in a tip pool.

Jennifer McCall, who is named on the franchise’s incorporation documents and is listed on employee schedules posted below the new instructions issued to workers, said she was unable to comment.

In statement, advocacy group for Tim Hortons franchises, the Great White North Franchisee Association, has said franchise owners are left with few options in the face of the minimum wage hike, and a parent company that refuses to increase prices.

“As far as what’s going on in individual stores I don’t have access to all that information,” Patti Jameson told the Star Friday.

Photos of the instructions posted at the Scarborough franchise were provided to the Star by an employee who asked for the name to be withheld for fear of reprisal. The employee said they were “shocked” at the new policies.

“These guys are busting their ass,” the worker said of their colleagues.

On Thursday, Ontario Premier Kathleen Wynne accused the owners of two Tim Hortons franchises in Cobourg, Ont., who are also the children of the chain’s founders of bullying employees after they eliminated paid breaks and instituted requirements for employees to pay a portion of their dental and health benefits following the province-wide wage bump, which lifts the hourly minimum from $11.60 to $14.

None of the changes violated workplace laws, but Wynne said the measures were “not decent.”

“It is the act of a bully,” she said.

Restaurant Brands International, the company that bought the Tim Hortons chain for $12.5 billion (Canadian) in 2014, has not responded to the Star’s requests for comment.

The Sunset Grill, a breakfast restaurant franchise, also informed its employees via a memorandum in November that menu increases, an increased “tip out” rate, and a 2018 freeze on kitchen staff wages were “necessary steps” for the company to take in the wake of the minimum wage increase. The same letter called the restaurant industry “especially vulnerable to employee layoffs and potential bankruptcy.”

“Tip outs” refer to a common restaurant practice whereby servers pay a portion of their tips, usually calculated based on their total sales, into a pool that is then distributed among support staff. It’s illegal in Ontario for companies to absorb a portion of the tip pool, but managers may be included in the distribution of tips if they regularly assist with duties other staff members perform.

The Sunset Grill described the 5 per cent tip out policy change as “mandatory” in its memorandum, meaning servers would be required to put 5 per cent of their sales toward the tip pool regardless of the total amount they were given in tips.

Attempts to contact the Sunset Grill head office were unsuccessful. A manager at the downtown Toronto Sunset Grill location at 1 Richmond St., who asked to be identified only by the name Peter, confirmed the memorandum’s accuracy to the Star and said the restaurant is complying with the new provincial rules.

“We’re following all the employment standards, we’re increasing the minimum wage to $14, following the vacation rules,” he said.

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