My neice has been working at an italian restaurant for 6 months. She just got in an argument with the owner and was told to find a new job. I told her to file for unemployment and she told me that she NEVER received a paycheck from her employer. she was told that she would work for tips only. Im not looking to open a can of worms where she will owe a bunch of taxes but how can this restaurant get away with this? is it legal? who should i report this to? will she be responsible for taxes even though he never paid her a wage?thanks for your help

No, it is not legal, but YOU don't file anything. SHE files a claim for unpaid wages with the state Dept. of Labor. How long did she work for them and how long ago?

She DOES owe taxes on her tips. And taxes should be deducted from her cash wages, once the employer pays them.

She just stopped working there last week, she had been working for them for about 6 months. So she hasnt done anything wrong here right?

will the employer get into a bunch of trouble for not paying her? can she go after the employer for anything but the back pay?

how does she file the claim with the department of labor?

To your last two questions.

Yes, they could.

Not personally, probably not, but the IRS certainly could.

She should file a claim for unpaid wages with the state Dept. of Labor ASAP. Directly-tipped employees must be paid a cash wage of at least $2.83/hour (regular time). Also, on a workweek basis, if tips plus cash wage do not average the state minimum wage of (currently) $7.15 per hour, the employer need to make up the difference. And she would need to be paid overtime pay at 1.5 times the full minimum wage for any hours worked in excess of 40 for the workweek.

PA DOL wage complaint forms:
http://www.dli.state.pa.us/landi/cwp/view.asp?a=142&q=201211&landiPNavCtr=|3876|&TNID=3880#3880