Neither Australian hospitality award contains a single tipping clause: a full text check of MA000119 and MA000009 on 7 October 2026 returned zero occurrences of tip, tips, gratuity, tronc or service charge.
Skai Solutions builds phone agents for Australian and New Zealand venues, so we read award clauses on behalf of operators for a living. This page gives you the measurement, what it does and does not mean, how cash and card tips differ, and the six things a tip pooling policy has to settle because no award settles them for you.
Mechanically, it is simple. Tips go into one pot instead of to the individual who was handed them, and the pot is divided by a rule the venue sets: evenly across everyone rostered, by hours worked, by points weighted to section, or split between front and back of house. Cash tips are usually counted at close. Card tips arrive through the terminal or the ordering platform and land in the venue's bank account first, which is the fact that changes everything downstream.
What makes the Australian version different from everything written about tip pooling online is that there is no rulebook sitting behind it. In the United States the arrangement is governed in detail, down to which job titles may share in a pool. Here, the two awards that cover almost every restaurant, cafe and pub in the country have nothing to say about it at all.
No. Not a word, and we checked rather than assumed.
On 7 October 2026 we downloaded the full published text of the Restaurant Industry Award 2020 (MA000119) and the Hospitality Industry (General) Award 2020 (MA000009), stripped the markup and counted. MA000119 runs to 207,809 characters of award text. MA000009 runs to 322,546. The case insensitive count of "tip", "tips", "gratuity", "tronc" and "service charge" in both documents together is zero, for every one of those five terms.
| Award | Characters of text | Mentions of tips, gratuities, tronc or service charge |
|---|---|---|
| MA000119, Restaurant Industry Award 2020 | 207,809 | 0 |
| MA000009, Hospitality Industry (General) Award 2020 | 322,546 | 0 |
Read that carefully, because it is narrower than it looks. It does not mean no Australian law touches tips. The Fair Work Act 2009 still governs what an employer may deduct from an employee's pay and still requires award minimums to be met in full. Tax law still applies. Contract law still applies, and so does whatever you wrote in the employee's letter of engagement. What the zero means is specific: the instrument that sets out minimum shift lengths, the 25% casual loading, penalty rates and allowances for your venue contains no tipping clause for anyone to breach or comply with. Tip pooling in an Australian restaurant is a matter of policy and contract, not of award compliance.
That is why the arrangements you see across two streets of venues differ so wildly, and why nobody can point you at the clause.
It depends entirely on how it arrived, and this is where most informal arrangements come apart.
A cash tip handed to a staff member is that person's property unless they have agreed, in advance, to put it into a pool. You cannot retrospectively claim cash that has already changed hands, and an instruction issued at the end of a shift is not an agreement.
A card tip is different in a way that trips people up. It is paid to the business. The money arrives in the venue's account, net of the merchant fee the acquirer charges on the whole transaction, tip included. When the venue then passes it on, it is passing on money from its own account to an employee, which is a payment. Payments to employees carry obligations: they are recorded, they are reported, and depending on how they are characterised they may attract superannuation and pay as you go withholding, which is set out with the sources in its own section below. The practical consequence is that card tips are not a neutral pass through, they are a payroll decision, and the cost of getting that decision wrong is borne by the venue rather than by the staff.
What the merchant fee on a tip actually comes to, card type by card type, is quantified below. If you are also thinking about what you may put on a bill and how it has to be displayed, those rules sit with service charges rather than with tips, and they are on our page on whether a restaurant can charge a service fee.
Two different questions with two different quality of answer, and most pages run them together. Here is what the Australian Taxation Office actually publishes, read on 13 October 2026.
ON TAX, the answer is settled. The ATO's page on employment income you must declare lists "cash tips, gratuities and payments for your services" among the work-related income an employee needs to declare in their tax return. Note what that page does NOT do: it draws no distinction between a tip handed over in cash and a tip distributed by an employer. On the ATO's own wording, a tip is declarable income to the person who receives it either way, which means "it was cash so it does not count" is not a position the published guidance supports.
ON SUPERANNUATION, the honest answer is that the published pages do not settle it, and this page is not going to pretend otherwise. The ATO's list of what payments are qualifying earnings for super does not mention tips at all. They are not named as qualifying earnings and they are not on the excluded list. The only gratuity on that page is a termination gratuity or golden handshake, which is excluded for a different reason entirely. So if you distribute card tips through payroll, whether super is payable on them turns on how the payment is characterised in your particular arrangement, and that is a question for your accountant with your arrangement in front of them. Anyone who gives you a flat yes or no to it online is guessing.
What follows practically is one rule: decide the characterisation BEFORE you start pooling card tips, not at the end of the quarter. An arrangement built on the assumption that no super is payable is expensive to unwind if that assumption was wrong, and the exposure sits with the venue, not with the staff who received the money.
A tip paid by card does not arrive whole, and the amount it loses is published. Reserve Bank of Australia table C3, average merchant fees for debit, credit and charge cards, released 7 August 2026 for the June quarter 2026, gives total merchant fees as a per cent of purchase value. The acquirer charges that rate on the whole transaction, tip included, so the tip is charged at the same rate as the meal.
| Card the customer tapped | Total merchant fee | Cost on a A$10 tip | Tip left to pool |
|---|---|---|---|
| eftpos debit | 0.43% | A$0.04 | A$9.96 |
| Visa debit | 0.56% | A$0.06 | A$9.94 |
| Visa credit, all cards | 1.00% | A$0.10 | A$9.90 |
| American Express credit | 1.36% | A$0.14 | A$9.86 |
| Visa credit, international card | 2.98% | A$0.30 | A$9.70 |
Read that honestly, because it cuts both ways. On a domestic debit tap the fee on a A$10 tip is four cents, which is not a reason to do anything differently, and a venue that deducts merchant fees from staff tips over four cents is managing a rounding error at the cost of its own credibility. On a tourist's overseas-issued credit card it is 30 cents, and in a venue where most tips arrive that way it is a real number across a year.
Two caveats the RBA itself puts on these figures. They are averages across all merchants, and the RBA notes that larger merchants tend to pay lower fees than smaller ones, so a single venue sits ABOVE these numbers rather than on them. And there was a series break on 1 December 2024 when coverage was expanded, so never compare a 2026 figure here with a pre-2025 one. What the percentage does across a full year of card volume is on our restaurant merchant fees page.
Almost everything written about tip pooling is written for the United States, and the autocomplete data shows it: the phrase "tip pooling" returns suggestions for California, Texas and Michigan to Australian and New Zealand searchers, because that is where the published material lives.
None of the American machinery exists in Australia. There is no tip credit, no sub minimum cash wage that tips are allowed to top up, and no federal rule listing which roles may participate in a pool. Those rules exist in the United States because the wage floor there can sit below the general minimum for tipped staff, so the law has to regulate the gap. In Australia the floor is the award rate in full, paid whether or not anybody tips, plus loadings and penalties on top. There is no gap for tips to fill, so there is nothing for a tip rule to protect.
The same logic explains the cultural difference operators notice: tipping here is discretionary and modest because the wage is not built on it.
Since no award supplies the terms, you supply them. A workable policy answers six questions in writing and nothing more.
Then have people agree to it at engagement rather than halfway through a Saturday. Agreement in advance is the whole mechanism here: it is what turns a cash tip into pool money legitimately, and it is what makes the arrangement something other than the manager's current preference. Our page on how to train restaurant staff covers getting that kind of thing into induction rather than into folklore.
Most venues are in this position and it is fixable in an afternoon. Four steps, cheapest first.
If none of that settles it, the dispute is about fairness rather than about rules, and no clause will fix it. The Fair Work Ombudsman is the right place for the pay questions sitting underneath it, and a venue with an enterprise agreement should read that agreement first: it can deal with tips even though the award does not.
This page describes what the awards and the published sources say as at 7 October 2026. It is not legal or payroll advice for your venue, and a question about superannuation or withholding on tips is one for your accountant or the Australian Taxation Office rather than for us.
Plenty of venues. If tips arrive rarely and in small amounts, a pool creates administration and a grievance channel in exchange for cents. Leave cash with whoever receives it, decline tips on the terminal, and spend the meeting on something that moves money. A quick service counter, a takeaway, or a cafe where the average tip is loose change is in this group, and saying so is more useful than a policy nobody reads.
Honestly, very little, and it would be strange to pretend otherwise. Tips do not move a venue's numbers much in this market. The thing that does move them is whether the next booking got taken.
Skai Solutions answers the phone when the floor cannot: on the first ring, during the rush, after close, taking the booking and sending it through to the system you already use. The reason it matters more than the tip split is arithmetic rather than argument. A table of four at the average spend on our average spend per head page is worth more than a month of pooled tips in most venues, and the calls that go unanswered are the ones that arrive while everybody is on the floor. Setup takes five days.
If your phone mostly carries suppliers and wrong numbers, a basic message taking plan is the right buy and it is not us. If it carries bookings during service, read what an AI receptionist for a restaurant actually does.
Is tip pooling legal in Australia?
There is no award rule either permitting or prohibiting it. Neither the Restaurant Industry Award 2020 nor the Hospitality Industry (General) Award 2020 contains any mention of tips, gratuities, tronc or service charges, so tip pooling is governed by the agreement between the employer and the employee rather than by award compliance. General Fair Work Act rules about deductions from pay, tax law and contract law still apply.
Can an employer keep part of the tips?
Only with agreement and disclosure. Where card tips are involved the money reaches the venue's account first and the merchant fee is charged on the tip as well as the meal, so some venues retain a share to cover that. The figure should be stated in the written policy; an undisclosed deduction from a pool is the fastest way to lose staff trust.
Do you have to include kitchen staff in a tip pool?
Nothing in either award requires it or forbids it. That makes it a policy decision for the venue, which is why it is the question that recurs most often. Decide it explicitly and put it in writing, because an unstated answer defaults to whatever the floor assumes.
How should a tip pool be split?
By hours worked is the easiest arrangement to calculate and the easiest for staff to verify, which is why most venues that write a policy land there. Points systems weighted by section also work, provided the weightings are published rather than held by the manager.
Do American tip pooling rules apply in Australia?
No. The tip credit, the sub minimum cash wage for tipped employees and the federal restrictions on who may share a pool are all United States mechanisms that exist because the wage floor there can sit below the general minimum. In Australia the full award rate is payable whether or not anybody tips.
Are tips taxable in Australia?
Tips are income to the person who receives them and have to be declared. Where the employer distributes tips the payment can also carry pay as you go withholding and superannuation consequences, which is a question for your accountant or the Australian Taxation Office rather than one this page can answer for your venue.