Confusion over WorkSafeBC tip rules has restaurants concerned
Both the British Columbia Restaurant and Foodservices Association (BCRFA) and Restaurants Canada say the directive from the Canada Revenue Agency (CRA) and the directive from WorkSafeBC are in opposition to each other.
They said WorkSafeBC's policy, which is newer, was 'quietly implemented' without any consultation or notice and has ended up surprising restaurants that have been audited.
However, WorkSafeBC told Global News that because of industry concerns, the new tip policy has been paused and the rules have not been implemented.
The BCRFA says businesses are still being audited and fined for non-compliance.
Ian Tostenson, president and CEO of BCRFA, told Global News he knows of seven restaurants that have been audited since November 2024 and says some have been fined.
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Under federal CRA rules, credit card gratuities are to be paid out in cash at the end of every shift and not included in employer payroll records.
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However, under WorkSafeBC's gratuity policy, employers must record all verifiable gratuities as controlled gratuities, meaning a mandatory service charge or a predetermined percentage added to the bill to cover the tip and then include them in assessed payroll.
According to WorkSafeBC, assessed payroll 'refers to the portion of an employer's payroll that is used to calculate their WCB (Workers' Compensation Board) premiums.'
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Tips for managing holiday spending
BCRFA and Restaurants Canada are jointly calling for an immediate halt to audits and enforcement action on WorkSafeBC's gratuity policy.
'There has been no notice to the industry, no training, and no orientation,' Tostenson said. 'Restaurants are being audited and fined for an unfair confusing WorkSafeBC gratuity policy directive they were not even unaware of. This is unfair and reckless.'
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The organization said that the gratuity policy is leading to additional red tape and costing audited restaurants thousands in additional payroll costs at a time when the industry is already struggling.
'Restaurants are between a rock and a hard place on gratuity policies,' Mark von Schellwitz, Restaurants Canada's vice-president for Western Canada said in a statement.
'They need to either comply with federal CRA direct gratuity rules where credit card gratuities are to be paid out in cash at the end of every shift and not be included in employer payroll records or comply with WorkSafeBC's gratuity policy that requires employers to record all verifiable gratuities as controlled gratuities and include them in assessed payroll.
'This puts restaurants into an impossible position of determining which contradictory gratuity policy to comply with.'
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