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Denial of Tips

If you work in the service industry and have ever felt like your employer is illegally keeping tips from you, you may be right. Wage-related rules for tipped employees, such as those working as bartenders or valets who receive money from satisfied customers, are governed by the Fair Labor Standards Act (FLSA) and state law.
Although the FLSA allows for tip pooling arrangements, employers must notify tipped employees of any tip pool contribution requirements and are prohibited from retaining tips for any other purpose. Every employer requiring workers to participate in tip pooling must be careful to observe the legal rights of employees. While it is true that employers have the right to require workers to pay into a tip pool, they may not do so in ways that violate an employee’s legal rights. Knowing these rights can go a long way for employees such as waitresses, bartenders, cleaning staff and others who deal with tips on a daily basis.
For example, an employer must never require that the portion paid into the tip pool be more than a customary and reasonable share. Additionally, all tip pooling arrangements must be valid according to law. This is because, generally, all tips should belong to the employee who earns them, not the employer. However, with a valid tip pooling arrangement in place, the employer may pool and distribute employees’ tips, but must observe the legal guidelines for doing so.

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