Interesting reading- Disney-Union Contract

[Brer Chump]

I stumbled across the current contract between Disney World and its unions. It's very interesting to look over as it has various wages listed. One clause which I found fits this forum states that if Disney re-instates automatic gratuities paid to the servers under the DDP, then they go back to the old contract's policies.

There is also mention of an automatic 3% service charge to every DDP bill, which is given to the server.

The contract can be downloaded here

 

[Rylee]

Thanks for the link.

It is interesting and may end the great debate over wages earned.

 

[Tricia1972]

Thanks for the link! I dowloaded it very quickly, before it mysteriously disappears from the internet.

 

[jensen]

Wow! Thanks for sharing that. So, if I'm reading this correctly... servers are making a minimum of $3.80/hr. + 3% tip?

 

[stitchsgrandpa]

Very interesting reading! Disney does refer to tips/gratuities as a service charge and they are mandatory.

 

[paulh]

very intresting,found the following intresting

The Company's position with regard to tips has not changed. It is the responsibility of all service persons to report one-hundred percent (100%) of their tips and gratuities for income tax purposes. The Company will continue to report eight percent (8%) of the location's gross sales to the government and will withhold tax on the tips and gratuities declared by the employee to the Company. The Company reserves the right to amend and/or alter this position to conform to state and federal laws.

so as i see it disney are telling your tax man that the aveage tip is 8%.looks like servers are coming out well with auto tip of 18%
Tricia as i have said in past and reading this contract,disney had every intention of introducing the 18% for everone
Paulh

 

[angelmav]

Thanks for posting that and it is interesting reading. Disney looks like a pretty good employer to me!

 

[tloft]

so as i see it disney are telling your tax man that the aveage tip is 8%.looks like servers are coming out well with auto tip of 18%
Tricia as i have said in past and reading this contract,disney had every intention of introducing the 18% for everone
Paulh

Disney isn't telling the tax man anything, this is federal tax guidelines and geared more towards restaurants that do a lot of cash business. As it states, 100% of employee reported tips will be claimed. Any automatic gratuities and all credit card gratuities will be withheld and reported to the IRS in full. The 8% rule would only applies in circumstances where an employee collects a majority of their tips in cash and fails to report these tips for tax purposes. If you finish your shift with $1000 in sales, collect all cash, then pretend that everyone stiffed you; Disney, following IRS guidelines, is going to presume you brought in $80 anyway and tax you accordingly. With the number of room charges and credit card transactions and I would gamble that the minimum 8% tip reporting never comes into play at Disney restaurants. It is matter of legalese that they make note of the policy - if they don't, if a Disney employee is ever audited and found to have improperly withheld information on tips collected I'm sure they would try to blame the company for not explaining the rules better.

At my restaurant sales are very close to 50/50 cash & credit on a regular basis, meaning tips are also usually 50/50 cash and credit. Credit card tips are automatically tracked by the computer under each servers id #. At the end of their shift as long as those credit card tips are in excess of 8% (which is almost always) of sales the computer will let them log out without requiring them to report any additional gratuity (though it prompts them to enter more if they so desire). If their credit card tips fall below 8% it will prompt them that they must report an additional cash tip before they can close out.
The law says they must report their cash tips in full. An employer can only inform the staff that the government expects full reporting - I cannot follow my staff around the restaurant counting cash tips or take cash out of their pockets at the end of the night to questions them on it. It is the IRS that has set up the 8% standard for tax purposes and is willing to live with it - no one believes that this is the actual average tip.

 

[JimMIA]

Wow! Thanks for sharing that. So, if I'm reading this correctly... servers are making a minimum of $3.80/hr. + 3% tip?

Florida's minimum wage for servers is $3.65, so Disney is slightly above the minimum.

The national minimum wage for servers is something like $2.20-2.25, but some states have higher minimums. A few states have the same minimum wage for servers that all other workers have.

 

[TLSnell1981]

At least, in the contract, they call it what it is....a service charge.

I was a little confused when I read there was also a 2% charge added to DDE for a party 5 or less. Why? They receive 18% regardless for DDE....or did I read this wrong?

 

[Brer Chump]

I believe the 2% service charge only applies to DDP and starts in 2010, a reduction from 2008-2009 levels. As far as the Company is concerned this is part of the employees wages, and not considered a tip. This may be due that the money is processed by a middleman (Disney) and not given directly to the employee.

We are using DDP next week so I will look at my receipt to see if there is a 3% service charge added on the receipt or if it is hidden under a different charge.

 

[jasonpicken]

i was on ddp 2008 and noticed a service charge on my coral reef receipt, didn't particularly notice any others for sure. they also tell you on the receipt what an 18 and 20% tip would be to help. what was just said about servers wages in the states blows my mind. i don't think it's remotely close to that low here in canada.

 

[Uncleromulus]

So it still appears that however they are reported, calculated, or audited, the servers at WDW depend primarily on tips for their wage(??)

 

[LizinSTL]

I believe the 2% service charge only applies to DDP and starts in 2010, a reduction from 2008-2009 levels. As far as the Company is concerned this is part of the employees wages, and not considered a tip. This may be due that the money is processed by a middleman (Disney) and not given directly to the employee.

We are using DDP next week so I will look at my receipt to see if there is a 3% service charge added on the receipt or if it is hidden under a different charge.

My impression was that DISNEY is paying that 3% of each DDP meal to the server...not that the DDP guest is being charged the service charge. I could be mistaken though. I haven't heard anyone come back and report that a party of less than 6 was required to leave a tip of any level much less 3%!

It makes sense. There will be a certain amount of non-tippers in the beginning of this change and while the appropriate level of tipping has been debated ad nauseum on this forum, many who have been servers typically tip 20% or better for decent service (We also base our tip on how difficult we've been as guests!)

This also assures a server at Chef Mickey's breakfast that they'll get a couple bucks for waiting on that family of 4 that stiffs them. They have to pay taxes as if they made $4.80 tip on the family of 2A/2C they waited on for the last 90 minutes. If the family drops 3-4 bucks on the table on their way out the door like they generously do at the Old Country Buffet, the server has just lost money working that table. With Disney supplementing the DDP guests' tip by giving that same server $1.80, she's breaking even in terms of what she needs to claim on her taxes.

 

[Disneyof3]

i was on ddp 2008 and noticed a service charge on my coral reef receipt, didn't particularly notice any others for sure. they also tell you on the receipt what an 18 and 20% tip would be to help. what was just said about servers wages in the states blows my mind. i don't think it's remotely close to that low here in canada.

In Canada minimum wage is like $8.00 approx (could be even higher now). You have to remember though that here in Canada we pay alot more tax then they do in the states, also we pay higher for groceries and that accounts for everything. I would rather get higher wage and pay the tax then give up my healthplan

 

[paulh]

Disney isn't telling the tax man anything, this is federal tax guidelines and geared more towards restaurants that do a lot of cash business. As it states, 100% of employee reported tips will be claimed. Any automatic gratuities and all credit card gratuities will be withheld and reported to the IRS in full. The 8% rule would only applies in circumstances where an employee collects a majority of their tips in cash and fails to report these tips for tax purposes. If you finish your shift with $1000 in sales, collect all cash, then pretend that everyone stiffed you; Disney, following IRS guidelines, is going to presume you brought in $80 anyway and tax you accordingly. With the number of room charges and credit card transactions and I would gamble that the minimum 8% tip reporting never comes into play at Disney restaurants. It is matter of legalese that they make note of the policy - if they don't, if a Disney employee is ever audited and found to have improperly withheld information on tips collected I'm sure they would try to blame the company for not explaining the rules better.

At my restaurant sales are very close to 50/50 cash & credit on a regular basis, meaning tips are also usually 50/50 cash and credit. Credit card tips are automatically tracked by the computer under each servers id #. At the end of their shift as long as those credit card tips are in excess of 8% (which is almost always) of sales the computer will let them log out without requiring them to report any additional gratuity (though it prompts them to enter more if they so desire). If their credit card tips fall below 8% it will prompt them that they must report an additional cash tip before they can close out.
The law says they must report their cash tips in full. An employer can only inform the staff that the government expects full reporting - I cannot follow my staff around the restaurant counting cash tips or take cash out of their pockets at the end of the night to questions them on it. It is the IRS that has set up the 8% standard for tax purposes and is willing to live with it - no one believes that this is the actual average tip.

for explaining it.
Paulh

 

[angelmav]

My impression was that DISNEY is paying that 3% of each DDP meal to the server...not that the DDP guest is being charged the service charge. I could be mistaken though. I haven't heard anyone come back and report that a party of less than 6 was required to leave a tip of any level much less 3%!

It makes sense. There will be a certain amount of non-tippers in the beginning of this change and while the appropriate level of tipping has been debated ad nauseum on this forum, many who have been servers typically tip 20% or better for decent service (We also base our tip on how difficult we've been as guests!)

This also assures a server at Chef Mickey's breakfast that they'll get a couple bucks for waiting on that family of 4 that stiffs them. They have to pay taxes as if they made $4.80 tip on the family of 2A/2C they waited on for the last 90 minutes. If the family drops 3-4 bucks on the table on their way out the door like they generously do at the Old Country Buffet, the server has just lost money working that table. With Disney supplementing the DDP guests' tip by giving that same server $1.80, she's breaking even in terms of what she needs to claim on her taxes.

Thats exactly the way I understood that too, and you said it much beter than I could have!