The FLSA permits employers to use a tip credit to account for up to 50% of the minimum wage with respect to "tipped" employees.

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The Fair Labor Standards Act (FLSA) does permit employers to use a tip credit to account for up to 50% of the minimum wage with respect to employees who regularly receive tips, such as servers and bartenders. This means that the employer can pay these employees a lower cash wage, as long as their tips bring their total compensation up to the minimum wage. However, there are specific requirements and restrictions that employers must follow in order to use the tip credit, and some states have their own laws that further regulate tipped employees.

The FLSA Permits Employers to Use a Tip Credit to Account