Tip misappropriation is an epidemic in today’s cash driven service industries. While federal and state laws emphasize that tips are the sole property of the employee, these laws allow employers to use a portion of earned tips to offset the minimum wage owed to the tipped employee. Employers often take advantage of this “tip-credit” under impermissible circumstances or fail to comply with the extensive legal requirements of its use.
Federal and state laws also permit employers to implement a tip-pooling or a tip-sharing system. However, employers often enforce such systems improperly or allow them to extend to ineligible non-tipped employees, thereby making such systems invalid and illegal.
The laws governing the treatment of tips are extensive and complicated. We often see violations occurring in the following circumstances:
We are committed to ensuring that tipped employees are paid every dollar they are entitled to. If you believe your tips are being mishandled or you are otherwise not being compensated properly, please contact our attorneys for a free and confidential consultation: (877) 476-7797.