Hotel Unlawfully Taking Gratuities From Its Employees

Hello, I’m here to check whether my coworkers and I have a valid case regarding the money being taken from us or whether we are misinterpreting the law.

Location: Ontario, Canada.

We are bartenders and servers in Ontario, working at a restaurant inside a hotel (the restaurant is owned by the hotel as well).

Our managers and supervisors have been participating in a tip pool for several years, taking 2% of the total sales of the restaurant. (This translates to about 14% of the tips, which amounts to approximately $22 per day on average from each worker.)

Our case and understanding are as follows:

1- The Employment Standards Act (ESA) of Ontario defines managers and supervisors as employers.

2- An employer who is a sole proprietor or a partner in a partnership may share in tips or other gratuities redistributed if they regularly perform, to a substantial degree, the same work performed by tipped employees.

Based on the ESA page, whether the work done is considered substantial or not is determined on a case-by-case basis. It states:

"If a sole proprietor who works eight hours per day waited tables every day for five hours during the lunch rush and the dinner rush, the Program would take the position that the sole proprietor was regularly performing those duties to a substantial degree.

However, if a partner acted as a bartender only when there was an unexpected rush of customers or when an employee called in sick, and if neither of those events were a regular occurrence, the performance of these duties may not be considered regular because they are performed on an irregular and unpredictable basis."

3- Our managers and supervisors most often don’t help at all, and on busy days when they do help, they only cover for 1.5 hours. Based on this, it should be illegal for them to participate in a tip pool.

4- According to the ESA, unlawfully withheld or taken gratuities are considered owed wages from the company to the employee.

Based on our understanding, this constitutes wage theft.

We wanted to file a complaint directly with the Ministry of Labour. However, we were informed that since we are in a unionized workplace, we need to reach out to our union for assistance. We contacted the union about this six months ago through formal emails, but so far no action has been taken.

Do we have a valid case here or not? If so, how should we proceed? Any advice would be greatly appreciated. Thank you.