Running a small restaurant is a labor of love, but managing end-of-week payouts—from hourly wages to pooled tips—can easily become overwhelming. For many restaurant managers, using a reliable payroll and tip distribution app has become essential not just for accuracy, but for team morale and compliance. The good news? There are a few standout tools that streamline this entire process—so you can focus more on your food and your guests, and less on spreadsheets and calculations.
TL;DR:
If you’re a small restaurant manager looking to save time and avoid payroll headaches, using a dedicated payroll plus tip distribution app can be a game changer. Apps like 7shifts, Toast Payroll, and Gusto simplify both wages and tip splitting, ensuring compliance with labor laws and increasing staff transparency. These tools also help calculate overtime, track shifts, and avoid manual errors. Read on to discover the top 5 apps and how they can simplify your end-of-week payout process.
1. Toast Payroll: A Seamless Restaurant-First Solution
Best For: Restaurants already using the Toast POS system.
Toast isn’t just a popular POS system—it also offers a robust payroll and team management feature specially tailored for the food service industry. With Toast Payroll, employees can clock in and out within the POS system, while tips and wages automatically sync to payroll processing. This means no more manually exporting timesheets or calculating tip pools based on shifts and hours worked.
- Integrated Tip Pooling: Automatically divvy up tips across servers, barbacks, cooks, and more.
- Mobile Team Access: Employees get self-serve access to timesheets, W-2s, and pay stubs.
- Labor Compliance: Ensures you stay aligned with minimum wage and overtime laws state by state.
If you’re already using Toast on your front-of-house, switching to Toast Payroll is practically hassle-free. It allows you to handle scheduling, payroll, and tip distribution all under one digital roof.
2. 7shifts: More Than Just Scheduling
Best For: Small restaurants looking for a comprehensive staff management platform with flexible tip pooling features.
Originally designed as a scheduling app, 7shifts has evolved into a robust workforce management platform tailored for restaurants. Its built-in tip management module automates tip calculations based on rules you set—taking into account hours worked, role-based splitting, and even cash vs. credit card tips.
- Tip Automation: Distributes tips fairly among the team, reducing disputes and manual entry errors.
- Payroll Integrations: Works with Gusto, ADP, QuickBooks, and more for seamless payouts.
- Live Labor Cost Reports: Helps you keep labor spending in check throughout the week.
One of the best features? Managers can run payout reports in real-time and have them ready for Friday afternoon deposit runs. Employees love the transparency, while managers love having fewer end-of-week surprises.
3. Gusto: A User-Friendly Favorite
Best For: Small restaurant operators who want simplicity, great customer support, and all-in-one HR + payroll features.
Gusto has gained a popular following among small businesses thanks to its intuitive design and powerful feature set. While not restaurant-exclusive, it integrates smoothly with restaurant time-tracking apps and lets you easily configure tip reporting, minimum wage compliance, and hourly calculations.
- Automatic Overtime and Tip Calculations: Gusto understands FLSA guidelines, so you can pay correctly every time.
- Onboarding and HR Tools: New hires can fill out tax and direct deposit forms digitally.
- Customizable Dashboards: Track payroll expenses in relation to sales or hours worked.
Gusto also makes it easy to generate clean payroll journals and export them to your accounting software. It’s a fantastic choice if you prefer an all-in-one experience that handles HR tasks alongside accurate payday runs.
4. Square Payroll: Simple, Affordable, and Restaurant-Ready
Best For: Restaurants already on the Square POS ecosystem or needing budget-friendly payroll tools.
Square Payroll is a natural add-on for restaurants that already use Square for orders and payments. Like Toast Payroll, it syncs directly with time clocks and shift logs, automatically accounting for tips earned by staff. It’s known for being easy to use and transparent about pricing—with no hidden costs and a flat rate per employee.
- Instant Syncing with POS Data: Pulls in hours, overtime, and tip data from Square POS.
- Flexible Deposit Timelines: Options for next-day payments to keep staff happy.
- Free Employee Accounts: Staff can manage their own tax docs and view pay history.
One particularly useful feature is the ability to set up custom tip distribution rules right in the system—reducing disputes, saving hours of back-office calculations, and making the end-of-week wrap-up less stressful.
5. TipHaus: The Ninja-Level Tip Pooling Tool
Best For: Restaurants with complex or rotating staff roles who need precise control over tip rules.
Meet TipHaus, a specialized tip distribution software designed exclusively for the hospitality industry. It’s not about payroll in general—it’s about solving tip chaos. TipHaus syncs to your existing POS system (like Toast, Square, or others) and instantly calculates tips using customizable formulas based on shifts, hours, job roles, and even sales performance.
- Real-time Tip Transparency: Give staff visibility into their expected payout, broken down by shift.
- Complaint-Free Distribution: Managers can set detailed rules for pooling and ensure every cent is accounted for.
- End-of-Week Reporting: Generates ready-to-export reports for payroll software or printouts.
For restaurants juggling FOH, BOH, multiple shifts, and bartenders, TipHaus gives you laser-sharp control without the spreadsheet headaches. Pair it with tools like Gusto or Square Payroll for a complete payout and compliance package.
Tips for Choosing the Right System
All five of these tools are powerful—but which is right for your restaurant?
- Audit Your Current Workflow: Are you already using a POS with integrated time tracking? Look for payroll tools that sync easily.
- Consider Your Staff Size and Roles: If you have rotating job positions or shared responsibilities, opt for an app like TipHaus or 7shifts with nuanced rule handling.
- Think Long-Term: Choose a scalable platform that can grow with you as you expand locations or hire more staff.
- Check Local Laws: Some tools have better support for specific state labor laws, including tip credits and minimum wage compliance.
And don’t underestimate the value of great customer support. If anything breaks or needs adjustment right before Friday’s payouts, fast assistance can make all the difference.
Final Thoughts
Simplifying payroll and tip distribution doesn’t just save time—it improves trust, consistency, and financial accuracy for your entire team. Whether it’s Toast for deep integration, Gusto for simplicity, or TipHaus for expert-level tip strategy, these apps are designed to make your week easier, not harder. Choose what aligns best with your existing systems and team size, and watch your end-of-week stress melt away like butter on a hot skillet.