As lawyers for the workers, we make sure that employers pay you for the long hours you put in and give you the wages you are owed.
Though it is prohibited by both federal and state laws, tip theft is an alarmingly common practice. It occurs when employers take, collect, or withhold tips that have been rightfully earned by tipped employees. This includes certain instances in which an employer collects all tips earned and redistributes them among tipped employees, or “tip pooling.” In many cases, it is unlawful for the employer or a non-tipped employee to keep a portion of pooled tips; this is a form of tip theft.
If you believe your employer has engaged in illegal tip pooling or another form of tip theft, contact Josephson Dunlap right away. Our employer tip theft attorneys can help you determine whether you have a case and, if so, can fight tirelessly for you and your rights. We understand the many state laws and particular nuances that impact these claims; our team has the resources and experience to help you navigate the legal system.
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Companies may engage in a variety of practices or activities that constitute tip theft, including but not limited to:
- Taking tips that were given to an employee
- Stealing tips from a tip jar
- Using tips from a tip jar to pay for business expenses, such as supplies
- Confiscating or withholding tips as “punishment”
- Withholding tips from new employees
- Wrongfully denying tips to certain employees
- Engaging in illegal tip pooling practices
- Taking illegal tip credits
- Failing to make up the difference between an employee’s tips and the minimum wage
- Requiring tipped employees to give a certain percentage of their tips to the employer
- Using tip pooling to pay employees less than the minimum wage
Legally, tips belong to the employees who earn them—not the employer. If the employer takes, withholds, or collects some or all of an employee’s tips, they have engaged in tip theft and can be held accountable.
What to Do If Your Employer Steals Your Tips
If your employer has stolen tips that you rightfully earned, you can file a complaint or claim with the labor board or another appropriate agency. You should also consider contacting a law office that handles these types of cases, as you may have grounds for legal action against your employer.
At Josephson Dunlap, we have represented more than 100,000 workers nationwide in all types of wage and hour cases, including those involving unlawful tip pooling and employer tip theft. Our experienced attorneys have recovered hundreds of millions of dollars in unpaid wages and have a 99% overall success rate. We are ready to stand up for you and your rights.
We represent hourly workers and other tipped employees, providing the personalized counsel and compassionate, one-on-one legal attention they need. Our goal is simple: to recover the wages you have rightfully earned. Let us help you with your claim today.
Can Employers Pay Tipped Employees Less Than the Minimum Wage?
Employers cannot pay any employee—including a tipped employee—less than the federal, state, or local minimum wage. However, some states allow employers to take what is known as a “tip credit.” A tip credit is the difference between an employee’s regular pay rate and the minimum wage. The idea is that the employee will make up the difference, or the tip credit, in tips.
For example, in Texas, employers are allowed to take a tip credit of $2.13 (as of January 2023). This means that a restaurant in Texas could legally pay its servers as little as $5.12 an hour—or $2.13 less than the state’s minimum wage of $7.25 an hour. However, a server must make up the extra $2.13 an hour in tips; if they do not, their employer is responsible for making up the difference between their hourly rate plus the amount they have made in tips and the minimum wage.
Note that different states have different laws, and some cities even have separate regulations governing tip credits and what employers can and cannot do when it comes to paying tipped employees. We strongly recommend that you reach out to our knowledgeable attorneys if you believe you may have a wage and hour claim involving tip theft.
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