Tip Pooling with Manual Contribution

Updated July 12, 2023 17:18

Setting up your Tip Pool - Manual Contribution

If you do not use a supported POS or want to use tip data from a specific source, you can still use the Tip Pooling feature. Here's how you can set up your Tip Pool and enter your tip data manually into 7shifts for redistribution.

⚠️ Prerequisites

⚠️ To access the Tip Pool feature using Manual Contribution, you will require the following:

7punches for time clocking or an Actual Labor integration with a POS (since this feature relies on employees' worked hours in order to redistribute tips).
Have Role and Employee mapping completed. This will ensure that Employees will be assigned the correct tips, based on their hours and Roles.

⚠️ By default, Managers and Assistant Managers will have access to manage or edit the Tip Pool settings. However, Admins can change this by enabling or disabling the manager permission 'Can create and edit tip pools.'

To set up your Tip Pool:

Hover over the navigation bar > Tip Management > Tip Pooling > click + Create pool:

Or, from the 7shifts logo > select Add-Ons > click Start a trial.

You may be asked to answer a quick survey about your current Tip Pooling needs and our recommendations!
Select your Location, enter a name for your Tip Pool, set your Calculation Frequency, and click Next.

The name is required since you'll later have the option to create multiple Tip Pools for the same Location.

By default, the Calculation Frequency will be set to Daily. Change this by clicking on How often are tips calculated: 'Daily', and select a new option from the dropdown menu:

Set the date to start pooling your tips. The date will automatically default to the last date of the pay period on your Time Clocking page, Set the date for which your last pay period ended, and we'll use this but you're welcome to adjust it as needed! :

Pro Tip!

We recommend that you align these dates with how you view pay periods to ensure accurate reporting.

⚠️ If you want to create this Tip Pool for a specific Daypart, select 'Dayparts' from the dropdown menu , and choose which Daypart will apply to this tip pool. If enabled, an additional column for Dayparts will be included on the Tip Pool report.
Then, click on 'Next.'
Then, in the dropdown determine how you'd like tips to be redistributed to your team. All distribution methods will reallocate tips based on employees' actual worked hours. Select any 1 of the 3 distribution options:

Click on the panels below to learn about each distribution type:

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
Next, you will need to select your Receivers:
- Click the dropdown and select a Department or specific Role.
- Click on '+ Add Receiver' to include more Departments or Roles.
- Click on the 'Trash' icon to remove any Departments or Roles from the list of receivers.
⚠️ You can have as many receivers as there are Departments and Roles under that Location.

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.
After you have set up which Departments and Roles will be receiving tips, click on 'Next.'
Lastly, you will be given an overview of how your Tip Pool will be set up. Here you can go back through any steps to make any changes needed, or click on 'Save my tip pool' to finalize it.

You've just created a Tip Pool! Now you can enter your tip data into 7shifts.

⚠️ Managers and Assistant Managers will require the 'Can add and edit tip contributions' Manager Permission to be able to enter tip data into the Tip Pool.
To enter your tip data, head to the Tip Pooling tab. Next to the appropriate Tip Pool, click on Add Tips.
Then, enter your Tip data under the appropriate date. You can enter data for other weeks by using the date selector.

⚠️ If you enabled the Dayparts option while setting up your Tip Pool, you'll be able to enter tips for the selected Dayparts separately.
Be sure to hit 'Save' before leaving this page or changing the week.

Now you're ready to create more Tips Pools or access any of your Tip Pooling reports.