No, that’s the law. Employers in many service industries enjoy relaxed rates below minimum wage. The law is that if during their standard pay period, their net

No, that’s the law. Employers in many service industries enjoy relaxed rates below minimum wage. The law is that if during their standard pay period, their net wage (paying below minimum for hour worked) + their total tips don’t equate to what they would have earned making federal minimum wage for the time they worked, the employer has to pickup the slack to assure they are paid at least minimum wage. If the total sum of tips plus their lower pay rate exceeds what they would have otherwise earned making actual minimum wage rates, then the employer doesn’t have to pay any additional wages because tips picked up the slack. Also the employee is rewarded by making rates above the minimum. In the first case, the employee getting tipped some but not enough to make minimum wage will ultimately only get minimum wage rates for their work. Your tips just close the gap a bit for the employer who would have to pay less to make sure the employee made minimum wage. So, subsidizing the employer/business. As someone else suggested, tipping in cash is my preferred way because it allows the employee to pocket the tip without reporting, assuring the tip actually goes to them. Overall in most cases tips should be a non-existent practice or at the very least, not nearly as frequent as it currently is. I regularly dine at several restaurants that have now included tips in their menu and service costs that assure employees are paid a fair rate. The menu prices are slightly higher but I prefer this practice because I know everyone is treated reasonably. If service staff go out of their way and above and beyond, I’ll throw in extra, which is what tipping should be, at least in my opinion.