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No private right to sue for tip violations

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in Human Resources

The California Supreme Court has ruled that employees don’t have a private right to sue their employers for alleged tip violations.

Recent case: Casino poker dealer Louie Lu brought a lawsuit against his employer, the Hawaiian Gardens Casino near Long Beach. Lu alleged that the casino violated the California Labor Code provision that says gratuities are the sole property of the employee to whom they are paid and cannot be taken by the employer.

The dealer wanted the case to be a class-action lawsuit. The casino allegedly violated the tip provision by requiring dealers to set aside a small portion of their tips for other co-workers such as concierges, tournament coordinators and customer service reps.

The casino argued that the California Labor Code doesn’t give employees the right to sue their employers directly for tip violations such as this.

The California Supreme Court agreed. It said the California Legislature specifically assigned enforcement of the Labor Code’s tip provisions to the California Department of Industrial Relations. It dismissed Lu’s case. (Lu v. Hawaiian Gardens Casino, No. S171442, Supreme Court of California, 2010)

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