Employees of employers collecting service charges are entitled to an equal share in the 85% of the total of such charges, except managerial employees. The remaining 15% of the charges may be retained by the management to answer for losses and breakages and for distribution to managerial employees, at the discretion of the management in the later case Service charges are collected by most hotels and some restaurants, night clubs, cocktail lounges, among others.
Payments
The shares of the employee in the service charges have to be distributed to them not less often than once every two (2) weeks or twice a month at intervals not exceeding sixteen (16) days.
Where the company stopped collecting service charges, the average share previously enjoyed by the employees for the past twelve (12) months immediately proceedings such stoppage shall be integrated into their basic wages.
Tips
Where a restaurant or similar establishment does not collect service charges but has a practice of policy of monitoring and pooling tips given voluntarily by its customers to its employees, the pooled tips should be monitored, accounted and distributed in the same manner as the service charges.
