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Employers May Not Have To Share Tips With Employees

Posted in Employment Contracts and Agreements, Wage & Hour

Introduction

Imagine this scenario – you have hired a catering company to cater an event for you. The company performs its obligations, providing both the food and catering staff to ensure your attendees are well fed and taken care of. Happy at the conclusion of the event, you pay the company in full, and provide extra payment to the catering company in the form of a tip to demonstrate your appreciation. Who owns that tip – the catering company hired to provide the services, or the catering staff who worked the event?

On June 30, 2017, in Marlow v. The New Food Guy, Inc. d/b/a Relish Catering, the U.S. Court of Appeals for the Tenth Circuit determined that the Fair Labor Standards Act (“FLSA”) does not require an employer to share tips earned by an employee with that employee, as long as the employee is paid more than minimum wage.

To read the full article, visit the HRUSA blog at http://blog.hrusa.com/blog/employers-may-not-have-to-share-tips-with-employees/.