Tipping of employees is allowed in New York State and the law requires that any tip left for an employee must be paid to the employee. Certain employers are permitted to pay a sub-minimum wage because tipping the employees is customary. The rules regarding tips and the tip credit are complicated.
Workers in New York City are protected by both federal and state laws mandating that people be fairly compensated. Under these laws, people are guaranteed at least a minimum wage for work they do and, in certain cases, for one and a half times their hourly wage for work performed in excess of 40 hours during a week. Unfortunately, wage theft – paying people less than the law requires – is rampant.