"Everybody believes if we go to a restaurant and we put down a tip it is never part of our understanding that's going to go to the owner or management," said McGuinty.
"It’s about providing a little bit of extra income to those people who wait on the tables or share with the bus boys or whoever. I think that’s the implicit understanding we have as consumers, and I think we should have a law that reflects that."
NDP finance critic Michael Prue has been trying to ban owners and managers from taking a percentage of tips since 2010, and has reintroduced a private members' bill to outlaw the practice.
Prue received a lot of media attention and support for his idea on newspaper editorial pages, which he credits with helping convince McGuinty and the Liberals to take another look at his bill.
"There’s such a public appetite for this that I’m not surprised the Liberals are thinking they better go with it too," Prue told reporters.
"They realize they can’t be standing there as the minister did Monday and say that it’s OK for an employer to negotiate this in advance and for people then to be ripped off."
Labour Minister Linda Jeffrey initially said it was legal for owners to take a percentage of tips as long as that was made clear when people were hired, and told waiters and waitresses to find work elsewhere if they didn't like those arrangements.
McGuinty ordered Jeffrey to reconsider the NDP bill.
"I’ve had a good conversation with the minister and I think the initiative put forward by Mr. Prue is worthy of very careful considering on our part," the premier told reporters.
"The NDP have put their finger on an important issue. I think we’ve got a responsibility to take a very careful look at it."
Jeffrey said she was worried Prue's one-line bill may have unintended consequences such as banning tip sharing among servers and the kitchen and bar staff who legitimately get a share of gratuities.
"We’ve got to get some language that more accurately reflects what’s happening (so) whoever is getting a piece of that tip will be benefiting as they should," she said.
The Ontario Restaurant and Bar Association said it did not think it was common practice for owners or managers to take a percentage of tips, but Prue estimates it happens in one-third to one-half of restaurants in the province.
Prue has even heard from a hairdresser who said he doesn't get any of his tip if the customer puts the gratuity on a credit card.
Servers have a lower minimum wage than most workers, $8.90 an hour compared with $10.25, in part because they are expected to make up the difference in tips.
It's not only full-time servers who rely on tips as part of their income, said McGuinty.
"I’m not sure how many hundreds of thousands of young people between the ages of 18 and 24 working their way through school are dependent upon fairness in the administration of tips in Ontario," he said.