Who pays a tipped employee? The employer? The customer? Other employees? The Fair Labor Standards Act requires that employees receive at least minimum wage for all hours worked. Employers must pay some portion of the hourly rate -but not all of it. This happens when employers take a “tip credit” against their minimum wage obligations. The tip credit allows restaurants and other hospitality industries to offer sub-minimum wage to their tipped employees. Employers may only take the tip credit if the employee is on notice and retains all tips. Another aspect of who pays your wages depends on whether you participate in a tip pooling arrangement. Tip pooling arrangements vary in size and scope, but have strict requirements as to who can share in the money. It is debated whether employers who do not claim the tip credit are required to comply with the strict tip pooling requirements. Last month, the Ninth Circuit said “yes.” With this new decision, employers in this jurisdiction with tipped employees may want to review any tip pooling agreements to ensure compliance.