Set up tip pooling
About tip distribution
You can use tip pooling to equally divide each card tip across all tip-eligible team members clocked in at the time of the transaction. All transaction tips, including any tips from Order partners, are included in the tip pool.
Square offers four types of tip distribution:
Tip directly: Transaction tips are attributed to the team member who collected the tip.
Pool tips per transaction: Transaction tips are split equally between all tip-eligible team members clocked in at the time of the transaction. This distribution method works best if you want to reward your team based on the tips earned during their specific shift.
Pool tips by hours worked: Transaction tips from sales are split among tip-eligible team members based on their hours worked. You can specify whether to split tips based on a 24-hour working day or across a 7-day working week. Splitting tips by working day works best if you want to reward team members who may not work their entire shift interacting with customers; splitting tips across a working week better accounts for tip variability across a wider timeframe.
Pool tips by percentages: Tips are split by a user-defined percentage at the end of each working day or working week among tip-eligible jobs. Tip-eligible team members with the same job will receive tips based on hours worked, and tip percentage amounts assigned to each job must add up to 100%.
Before you begin
You can adjust tip-pooling settings from your Square Dashboard.
Before setting tip pooling up, check that each team member has the appropriate tip-eligibility settings in their profile. For example, if you don’t want a manager to receive tips, you’ll need to toggle Tip eligible off in their team member profile through your Square Dashboard. Learn how to Add and manage team members.
Set your tip distribution method
After confirming that you applied tip-pooling eligibility to all of your team members, you can turn tip pooling on. You can also require team members to declare cash tips when clocking out or switching roles at a point of sale or on the Square Team app.
Sign in to your Square Dashboard and go to Staff > Settings > Tips.
Select your Distribution method.
Select a Timeframe, if applicable.
For Apply to, select the locations where you want the tip distribution to apply and an effective date, if applicable.
If you want tips received when no one is clocked in to distribute equally among all tip-eligible team members who clocked in on that working day, toggle Distribute unattributed tips equally on.
If you want tip-eligible team members to enter their cash tips from the shift report or when they clock out, toggle Declare cash tips on and select the locations to apply the feature.
Select Save.