Law Times

Law Times • November 22, 2010 MPPs united on banning tip theft political and legal issue. At restaurants, we leave T something extra for servers that they may or may not share with other staff . Th erein lies the issue. Who should actually get the tip? Th at's the political and legal matter now going to committee at Queen's Park. Here's something to think about at those parties and dinners, courtesy of a private member's bill by NDP MPP Michael Prue. He wants to ban restaurant owners from the fast- spreading practice of tipping out in which they take a cut for the house. Th e ban won't be in place for the holiday season but it bears some consideration. Prue holds, and I think most people would agree, that restau- rant owners make their margins by controlling input costs and charging what they think the market will bear for their fi nal product, which is a combination of ambience, location, quality of food, and type of cuisine. Sadly, that's not enough in these hard times for some res- taurant owners. Th ey've been taking a percentage of tips on the grounds that they have over- head costs and deserve compen- sation, especially when it comes to the surcharge levied by credit card companies, breakage, and incidentals such as uniforms. It's not uncommon, Prue notes, for servers to get only three per cent of a 15-per-cent tip once management has taken its cut and then distributed the gratuity to other members of the staff . Prue quoted from a restau- rant industry blog in the legis- lature: "I worked for Bocca on Baldwin. Th ey wanted a four- per-cent tip-out, all of which went to the house. When I was hired, I was told that this money went to the 'manager' (the own- ers' son), for his help with bus- ing and seating, food running, etc. However, I soon discovered that most of my shifts were to be worked on my own, with no support staff at all. Nonetheless, tip-out was mandatory." Th e kicker in all of this is that the law recognizes that servers earn part of their income from tips and thus sets the minimum wage lower for them at $8.90 per hour compared to $10.25. Also, the Canada Revenue Agency impugns earnings from tips at an average of 12 per cent and levies income tax accordingly. In eff ect, it's taxing them on money they don't actually earn. "I think some greedy owners are looking at this as a way of making easy money, easy tax- free money, on the backs of their workers," said Prue. Most private members' bills never make it to become law. Th is one may be an exception since it has all-party support. Certainly, the government can't be seen to be ignoring the lowest-paid voters ipping, a time-hon- oured notion, has suddenly become a Inside Queen's Park By Ian Harvey on this type of issue. Who doesn't sympathize? Even the Conservatives threw their support behind the bill, with hard-right MPP Randy Hillier suggesting the proposed law "is probably in the Guin- ness Book of Records as the shortest bill; it is one sentence." He's right. It ranks among the shortest of amendments to the Employment Standards Act by adding the following clause: "An employer shall not take any portion of an employee's tips or other gratuities." "I have a family friend who lives in Toronto and works at a good local restaurant here," Hillier said in the house. "His name is Aldo Pescatore-Tardi- oli, and his tips are taken by his employer. When he makes a 10-per-cent tip, his employer gives him back three per cent; seven per cent of the tip goes to the restaurant. When he makes a 15-per-cent tip, he gets three per cent. Th at's the maximum he is going to get as a server." Tipping out wasn't a common practice until recently, Prue says. It seems to have become more frequent as the recession bit into restaurant revenues to the point where it's quickly becoming the default standard in Ontario, es- pecially in Toronto. Th ere's something inherently wrong in charging the lowest- paid workers a levy for the priv- ilege of working for you. In the meantime, as I dine out with friends, family, and colleagues this season, I will be asking my servers directly if their estab- lishment practises tipping out and will express my displeasure to the manager if it does. Sharing tips with other staff is one thing. It's a good practice because it's a team that provides the service. But forcing staff to fork over their tips to manage- ment is tantamount to robbery. Maybe my sense of outrage is misplaced, but judging by how the rabidly partisan elected mem- bers of the legislature seem to be standing shoulder-to-shoulder on this, I don't think it is. With this government desperate to curry favour with voters before next year's election, stepping up for the little people is a no-cost option compared to borrowing a billion dollars to return $150 a year to consumers on their hydro bills to soften the HST sting. LT Ian Harvey has been a journal- ist for 32 years writing about a diverse range of issues including legal and political aff airs. His e-mail address is ianharvey@ rogers.com. www.lawtimesnews.com I COMMENT What makes a good practice group leader? BY JEROME SHORE For Law Times n my experience in coaching lawyers, I've run into a number of excellent practice group leaders but I've also discovered it's not a job many lawyers aspire to. In fact, I've heard fi rms sometimes bestow the accolade upon law- yers drawing the short straw or the one unavail- able to attend the con- clave when they choose the practice group lead- er. In some cases, it's the best or most ambitious lawyer who gets the job but who isn't necessarily a skilled leader. In fact, it's another tough job lawyers learn nothing about in law school. In an article titled "Making the maestro collaborator in chief" in the May 20, 2007, edition of Th e New York Times, the following jumped out: "When you ask the players of a major orchestra what they want in a conduc- tor, they answer almost as one: a great musi- cian steeped in the heritage and repertory, an interpreter of insight and depth with the tech- nical skill to convey ideas and elicit results." Interestingly, I got similar thoughts when I asked a number of lawyers in Toronto about the role of the practice group leader. It seems lawyers view the best practice group leaders as collaborators-in-chief. In terms of some of the key things practice group leaders should be doing, a big priority should be getting good people into the group and then growing them as individuals and team members. I used to work for David Ogil- vy, whose advice to leaders was to "surround yourself with the best and the brightest while you separate the passengers without delay." Th e latter is usually harder than the for- mer, unfortunately. Once you've got your team in place, start working to understand what makes the members tick and what their needs are. More one-to-one and less group meetings is the way. Manage by walking around. Aaron Platt of Davies Howe Partners notes lawyers "have diff erent styles of prac- tice, learning, and communicating. Th e most inspiring practice leaders are those that know which situations call for a nuanced approach tailored to the individual and which situa- tions can be handled in a uniform fashion." At the same time, get people singing from the same song sheet. Th is gets you the many benefi ts of cohesion. Not knowing the val- ues and mission of the organization reduces motivation and is confusing. As the practice group leader, take as much time as you need to settle on the values and mission of your group, whether they involve unbounded cli- ent satisfaction, always adding value, harvest- ing diverse thinking, continuous learning or having a culture of work-life balance. Th en sell those principles and use them when you make decisions. People will think you're principled, at least when they agree with you. "Witnessing collaboration that gets better results for clients is among the most important things a younger lawyer learns from," says Shane Kazushner of Goldman Sloan Nash & Haber LLP. "None of us is as strong as all of us" is Speaker's Corner an axiom that characterizes collaboration. Th e idea of the collaborator-in-chief role is to make it easy for everyone to contribute. Th at takes regular eff ort to ensure the prac- tice group leader har- vests input from all of the diverse corners. Th e hard work includes ask- ing the right open-end- ed questions to stimu- late quiet or reluctant people. Many Type A personalities talk and interrupt so much that they quash others' contributions. As collaborator-in-chief, the practice group leader must create the space that inspires contribution. Robert Taylor, a partner at Sherrard Kuzz LLP, puts the issue this way: "When I fi nd myself in a leadership role, it is very impor- tant to solicit the views of the team on im- portant issues so that they ultimately under- stand how their input played a role in the decision." If the purpose of a practice group is to en- courage quality work and innovative think- ing, the group leader needs to stimulate the sharing of knowledge, the integration of ideas, and the management of eff ort. Col- laboration is key for each of these steps. Shar- ing knowledge puts more data on the table to discuss, sift through, and analyze, a process that involves taking advantage of experience. Integrating ideas is a catalyst to fuse the bits of diff erent concepts together to create some- thing new. Managing eff ort gets more of the right stuff done and ensures there are fewer mistakes. Collaborators-in-chief create virtuous spi- rals by constantly looking for the right com- binations of people and resources. Th ey do this by building the kind of trust that feeds into the desire to contribute and overcomes the fear of rejection, failure, and embarrass- ment. When collaborators-in-chief are at their best, they create an absence of vulner- ability so the whole team will contribute in an unbridled way. A nettle is a plant that is painful to grasp because it has little stingers on the leaves. Practice group leaders must grasp the nettles to make meetings and teams more eff ective. Th e best leaders identify the nettles early and don't let bad situations fester. One source of them is interpersonal factors such as emo- tions and the cultural diff erences that become magnifi ed in a stressful environment. Another cause is the avoidance of deci- sions. As Adam Wagman, managing partner at Howie Sacks & Henry LLP, points out, "Th e way to keep things moving is to focus on making decisions rather than pondering alternatives." LT Jerome Shore is an executive coach at Th e Coaching Clinic. You can reach him at 416- 787-5555 or coach@coachingclinic.com. PAGE 7

• Cover
• Libel Ruling Appealed
• Double-dipping
• Focus On Environmental Law