Tip Pooling with Manual Contribution

If you do not use a supported POS or prefer to use tip data from a specific source, you can use the manual contribution feature. This guide helps you set up a tip pool and manually enter tip data in 7shifts to ensure your team's tips are redistributed accurately based on worked hours.

Things to Know

• To use manual tip pooling, you must have 7punches or an Actual Labor POS integration enabled to track employees' worked hours. Role and Employee mapping  must also be completed to ensure tips are assigned to the correct roles.
• Align your tip pooling dates with your pay periods to ensure reporting remains consistent and accurate.

How to set up a manual tip pool

1. Log in to the 7shifts web app as an Admin or authorized Manager.
2. Navigate to Tip Management Tip Pooling and click + Create pool.

3. Enter the location, a unique tip pool name, and the calculation frequency.

   How often are tips calculated?

   By default, the Frequency is set to Daily.  Change this by selecting a new option from the dropdown menu:
   
   Set the date for which your last pay period ended, and we'll use this date to start pooling your tips. The date will automatically default to the last date of the pay period on your Time Clocking page, but you're welcome to adjust it as needed! 

   Pro Tip! Align these dates with your pay periods to ensure accurate reporting.

   If you want to create this Tip Pool for a specific Day part, select Day parts from the dropdown menu, and choose which Day part will apply to this tip pool. If enabled, an additional column for Day parts will be included on the Tip Pool report.

4. Select one of the three distribution methods: Equal Distribution, Percentage, or Points Weighting.

   Equal Distribution

   How Equal Distribution works:
   Each person will receive a portion of the tips based on the hours they worked. Let's say the Tip Pool is $500 and employees worked a total of 25 hours.
   $500 / 25 hours = $20 in tips per hour worked Server A: worked 10 hours and receives $200
   Server B: worked 7 hours and receives $140
   Food Runner: worked 8 hours and receives $160

   Percentage

   How Percentage Distribution works:
   Each role group is entitled to a specific percentage of the Tip Pool. Each person who worked that role will then receive a portion of the tips based on the hours they worked.

   Let's say the tip pool is $1000, Server distribution is set to 60% ($600) and Bartender distribution is set to 40% ($400).

   Server A worked 8 hours and receives $240
   Server B worked 12 hours and receives $360
   Bartender worked 5 hours and receives $400

   Note that since only 1 bartender worked, they will receive $400 regardless of the number of hours they work

   Points Weighting

   How Points Weighted Distribution works:

   Each person will receive a portion of the tips based on the hours they worked weighted by a point multiplier.

   Let's say the Tip Pool is $1200 and employees worked a total of 80 hours.
   Server hours get 2 points and Bartender hours get 1 point.

   All Servers worked 30 hours X 2 = 60 point-hours
   All Bartenders worked 20 hours X 1 = 20 point-hours
   Total point weighted hours are 80, therefore each point-hour is worth $15 in tips ($1200 / 80).

   Server A worked 10 hours for 20 point-hours and receives $300
   Server B worked 20 hours for 40 point-hours and receives $600
   Bartender A worked 15 hours for 15 point-hours and receives $225
   Bartender B worked 5 hours for 5 point-hours and receives $75

    

    
5. Click + Add Contributor to select the Roles or Departments that will receive tips.
   • If you chose to use the Percentage or Points Weighting distribution methods, you will need to enter a percentage or amount of points beside each Department or Role.
   • If using the Percentage distribution, there will be a tally at the bottom to ensure that you are not under or over the 100% total. You will be unable to proceed unless your total is at 100% exactly.
     
6. Review the tip pool configuration on the overview page:
   
7. Click Save my tip pool to finalize the setup.

How to enter manual tip data

1. Navigate to Tip Management > Tip Pooling.
2. Click Add Tips next to the specific tip pool:
   
3. Select the appropriate week using the date selector.
4. Enter the tip amounts under the correct dates for the tip pool:
   
5. Enter tips for specific Day parts if that option was enabled during setup:
   
6. Click Save before leaving the page to record the data.