How to setup Tip Calculation Formulas

7shifts Tip Calculations allows you to create automated rules to calculate paid and owed tips. By connecting tip data from 7punches, supported POS integrations, or Tip Pooling, you can automatically include tip totals when processing payroll.

Things to know

• Tip Calculation settings may require an upgrade from your current plan.
• Tip Calculations require active tip data from Time Clocking or a supported POS integration.
• Tip sources (POS, Tip Pooling, 7punches) must be enabled in your account to appear as calculation options.
• Tip Calculation equations are location-specific. 7shifts defaults to your last saved configuration when setting up a new location.

• Tip Calculations is available to POS integrations that support credit card tips. Here is a list of eligible POS systems:

  Aloha POS
  Brink POS
  Dinerware POS
  Future POS - Shift4
  Harbortouch POS
  Lightspeed POS (K-series)
  Micros 3700 POS
  POSitouch POS - Omnivore
  POSitouch POS - Shift4
  Qu POS
  Restaurant Manager POS - Shift4
  Revel POS
  Square POS
  Squirrel POS
  Silverware POS
  Toast POS
  TouchBistro POS

  The following is a list of eligible payroll Integrations or exports:

  7shifts Payroll
  ADP Run (US) Integration
  ADP WFN (US) Integration
  ADP WFN Next Gen (US) Integration
  Gusto Payroll Integration
  ADP WFN (US) Export
  Paychex Export
  Paylocity Export
  UKG Pro Export

Set up your tip calculation

1. Log in to the 7shifts web app as an Admin.
2. In the left navigation bar, go to Tips > Settings.
3. Select Set your tip calculation > Set up.
4. If you have multiple locations, choose a location from the dropdown menu and click Add.
5. Select the tip sources you want to be Paid (shown in green) and those you wish to be Deducted (shown in red).
6. Click Save and preview changes to save your settings and review how the calculation will appear for employees:

Formula components

The Tip Calculation formulas you set will determine how tip data surfaces in the Worked Hours and Wages Report, 7shifts Payroll and your integrated payroll export. You can customize equations based on these sources:

• POS: Credit card tips or other data pulled directly from your point-of-sale system.
• Tip Pooling: Calculated totals from automated or manual tip pools.
• 7punches: Declared tips entered by employees during clock-out when using 7punches. 

Tip Calculation set-up examples

Here are a few examples you can reference on how other accounts have set up their custom Tip Calculation equation.

Example 1: An account pulls tip data from POS + Tip Pooling 

Declared tips are paid on shift. Credit Card and Tip Pooling are paid on payroll. Contributions to the Tip Pool (Tip in) and Declared tips are deducted from Tips paid on payroll. 

Taking a closer look, you'll set up which tip sources are to be Paid (show in green) and Deducted (shown in red). We'll show you your final equation based on your selections:  

Example 2: An account pulls tip data from POS + Tip Pooling.

All tips are paid before payroll, except for pooled tips, which are paid on payroll. Contributions to a tip pool (Tip in) are deducted.


 

Example 3: Manual Tip Pooling. 

Only Tips distributed from the manual tip pools (Tip out) are paid on payroll. No other tips are paid before payroll.

Next steps

Once saved, you can view the results of these calculations in your reports. Navigate to Reports to see how the Paid and Owed totals appear for each employee before running your next payroll.