Is Your Employer Taking Your Tips? You May Be Owed Wages.
Tips belong to the worker who earns them, not the employer. If your tips have been withheld, pooled unfairly, or counted incorrectly, we can help you find out what you could be owed.
WORKERS REPRESENTED NATIONWIDE
IN WAGES RECOVERED
CONSULTATION FEE
What Is Tip Theft?
Do you rely on tips to make ends meet? Do you depend on them to get your fair share? Tip theft happens when an employer illegally withholds, mismanages, or takes a share of the tips you've earned. This is not a small mistake. It can significantly lower the take home pay of workers in the service industry who are relied on, like bartenders, servers, delivery drivers, and many more.
Tips belong to the employee who earns them, not the employer. If your employer takes a cut of your tips, forces you into an unfair tip pool, or counts tips toward pay they still owe you, they may be breaking federal law.
The FLSA and Your Tip Rights
The Fair Labor Standards Act, or FLSA, sets the baseline rules for tipped workers nationwide. Employers may pay a lower direct wage as long as tips make up the rest, but there are strict limits on how that works.
Tip Credit Basics
Employers can pay a lower direct wage if tips cover the rest. If tips fall short, the employer must pay the difference. Skipping required notices can cost the employer the credit entirely.
Tip Pooling Rules
Tip pooling among tipped staff is generally legal. Since 2018, federal law bars managers and supervisors from taking a share of pooled tips.
Service Charges Are Not Tips
Some employers label charges as service fees to sidestep tip rules. Mislabeling a mandatory tip as a service charge can be its own violation.
A Key Court Decision
The Fair Labor Standards Act, or FLSA, sets the baseline rules for tipped workers nationwide. Employers may pay a lower direct wage as long as tips make up the rest, but there are strict limits on how that works.
Restaurant Law Center v. U.S. Department of Labor (2024)
In August 2024, the Fifth Circuit Court of Appeals struck down a federal rule that limited how much time tipped workers could spend on untipped tasks, like rolling silverware, while still being paid the lower tipped wage.
Before this ruling, there was a stricter rule in place. It said tipped workers could only spend 20% of their time on tasks like rolling silverware or wiping down tables. If they spent more time than that, the employer had to pay full minimum wage for the extra time, not the lower tipped wage. In practice, this rule was hard for everyone to track. Workers and employers both struggled to count minutes accurately, shift after shift, which led to confusion and a lot of disputes.
The new ruling makes things simpler. As long as a task is part of your normal job, like a server also refilling condiments or bussing a table, your employer can pay you the tipped wage for that time. You don't have to worry about your employer timing every task you do during a shift. Your core protections stay exactly the same either way. You still keep your tips. You still must earn at least minimum wage when your wages and tips are added together. If your total pay ever falls short, your employer still owes you the difference.
This ruling also helps employers in a real way. Restaurants and similar businesses no longer have to track every minute of side work down to the second, which cuts down on paperwork, guesswork, and legal risk. That means fewer disputes over small amounts of time, and a system that's easier for everyone, workers and employers alike, to actually follow day to day.
What This Means For You
This ruling applies directly in Texas, Louisiana, and Mississippi, and employers here have more flexibility on how tipped staff spend their time. It does not change your core right to keep your tips or to be paid at least minimum wage overall.
As an Employee, You Generally Have the Right To:
Keep the tips you earn, unless a legal tip pool applies
Be paid at least the applicable minimum wage, regardless of tips
Refuse to share tips with managers or non-service staff
Take legal action if your employer is taking your tips unlawfully
Example: The Texas Tip Credit
Texas allows a tip credit of $2.13 per hour, and the state minimum wage is $7.25 per hour. Tip credit rules vary by state and even by city, so what applies to your job depends on where you work.
How the Numbers Work
- The Texas tip credit is $2.13 per hour
- The Texas minimum wage is $7.25 per hour
- Employers can pay tipped workers as little as $5.12 per hour directly
- Tips are expected to cover the remaining $2.13 per hour
- If tips don't bring your total pay to $7.25 an hour, your employer must legally make up the difference
Related Wage & Hour Claims
We handle a wide range of wage and hour disputes, beyond tip theft, including:
Arbitration Agreements
Meal & Rest Break Violations
Time Shaving
Unpaid Training
Minimum Wage Violations
Employee Misclassification
Unpaid Commissions
Untimely Wage Payments
Employer Tip-Theft
Off-the-Clock Work
Unpaid Overtime
Frequently Asked Questions
There is no cost. We offer free and confidential case reviews to help you understand your options. We do not charge any upfront legal fees. We only receive attorney fees if we win a financial recovery for you.
Getting started is straightforward. You can fill out our secure online form or call our office directly. A case manager will review your job details, look for qualifying wage violations, and let you know whether you may have a claim. This initial review is free and takes only a few minutes.
Federal and state laws prohibit employers from punishing or terminating workers for reporting wage violations or participating in a legal claim. This type of unfair treatment is called retaliation, and it is illegal. If your employer takes adverse action against you, our firm can advise you on your rights.
No. Your initial consultation with our firm is private and confidential. We will not contact your employer or notify them that you spoke with us. You can check your eligibility and learn about your rights without your employer's knowledge.
How Our Wage Recovery Process Works
Start your free, no-risk case review in about 10 minutes.
Submit Your Secure Form
Tell us about your missing pay through our confidential online form. We will review your details and follow up within 24 hours. Need answers right away? Call (888) 992-2990.
Get Your Free Consultation
A case manager will spend about 10 minutes reviewing your situation, looking for qualifying violations like unpaid overtime, off-the-clock work, or regular rate errors. Clear advice, no obligation.
We Build Your Case
If you have a valid claim, we get to work right away. Our team handles the paperwork, gathers the evidence, and builds a legal strategy suited to your situation.
We Recover Your Wages
Once we have the facts, our legal team pursues the full amount you are owed. You receive updates throughout the process and pay nothing out of pocket. Attorney fees are collected only if we win.
Talk to a Tip Theft Attorney
We offer free, confidential consultations and only get paid if we recover money for you. Find out if your employer owes you money.