*2024 CPP contribution rate is 5.95% and EI premium is 1.66%. In a controlled model where the employer has not deducted these amounts, they're responsible for both employee and employer portion (15.22%).
Controlled tips
Employees and employers must each contribute 7.6% of the tip amount for CPP and EI.*
The employer decides how tips are divided
The employer does not distribute tips at the end of every shift
The employer uses auto-gratuity
NOT EXEMPT
from CPP contributions and EI premiums
Direct tips
RECOMMENDED
Employees and employers are exempt from contributing to CPP and EI.
A group of employees known as a "Tip Committee" decide on the tip division model
The employer transfers tips to the committee at the end of every shift
The employer is not involved in distribution
Tips do not go on a credit card or charge card
EXEMPT
from CPP contributions and EI premiums