Tip Payouts Setup: Configure Transaction Fees

Updated February 19, 2025 22:11

This article explains what transaction fees are associated with 7shifts Tip Payouts and how to configure them for your business.

What are Transaction Fees?

Each tip payout processed through 7shifts involves a small transaction fee. This fee covers the cost of facilitating the instant transfer of funds to your employees' debit accounts. Understanding these fees is crucial for budgeting and ensuring transparency with your staff.

Configuring Transaction Fees

7shifts offers flexible options for how transaction fees are handled. You can choose to:

Pay the fee entirely: Your restaurant covers the full transaction fee for all tip payouts. This is often seen as a benefit for employees.
Have employees pay the fee: The transaction fee is deducted from the employee's tip payout amount.
Share the fee: The transaction fee is split between your restaurant and the employee. You can specify the split percentage (e.g., 50/50, 75/25, etc.).

Steps to Configure Transaction Fees

The option to configure your transaction fee appears when you build your first Payout Batch.

Start Building a Payout Batch: As you create your first Payout Batch, look for the 'Configure Transaction Fee' option, located on the right side of the screen. Select 'Configure' to get started.
Choose Fee Responsibility: Select the option that best reflects how you want to handle transaction fees:
- Restaurant Pays: Choose this option if your restaurant will cover the entire fee.
- Employee Pays: Select this option if the fee will be deducted from employee tip payouts.
- Shared: Choose this option to split the fee between the restaurant and the employee.
Specify Split (If Applicable): If you chose the 'Shared' option, specify the percentage split.
- For example, select '50' for a 50/50 split, '75' if the restaurant pays 75% and the employee pays 25%, and so on.
Review and Save: Carefully review your transaction fee configuration to ensure it's correct. Save your changes.

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⚠️ Important Considerations:

Transparency: Clearly communicate your transaction fee policy to your employees. Explain how the fees work and who is responsible for paying them. This helps avoid confusion and fosters trust.
State and Local Laws: Be aware of any state or local regulations regarding tip handling and deductions. Ensure your transaction fee policy complies with all applicable laws.

Managing Transaction Fees: You can adjust your transaction fee settings at any time. This article explains how.

Setup Next Steps:

Once you have created your first Payout Batch and configured your transaction fees, you'll proceed with the remaining steps of the Tip Payouts setup process. These steps will include: