"I'm guessing the check they write her is the CC tips and her base wage. The cash she gets to keep."
This is tax avoidance. Cash tips are taxable income. The IRS expects that tipped employees will report all their tips to their employer, even cash. The employer is required to include that money in their box 1 taxable wages, and withhold income tax, social security and Medicare tax based on the total of her tips and base wage. I'm not saying every tipped employee reports every bit of cash, but they are supposed to, and if she did not, there is a place on the tax return to include tips that were not reported to the employer so they can be taxed properly.
https://www.irs.gov/businesses/small-businesses-self-employed/tip-recordkeeping-and-reporting
Only about 1% of taxpayers are audited, but if she is audited, the IRS can look at her bank deposits and her lifestyle spending, calculate the amount of tips they think she has not disclosed, and assess tax, and then it is her burden of proof to prove that the IRS is wrong. So I would suggest caution, and read some of the rules, so she starts her work life on the right foot.
