A Practice Note discussing the treatment of tips under the Fair Labor Standards Act (FLSA), including the distinction between tips and service charges, the tip credit, mandatory tip pools, and notice and recordkeeping requirements. This Note is based on federal law. State or local law may impose different or additional requirements. For information on tipped employees under state law, see Wage and Hour Laws: State Q&A Tool and State and Local Tip Credit and Tip Pooling Restrictions Chart: Overview.