I worked in restaurants and bars throughout high-school and uni. I even worked for the Roux brothers and Nico Lanidis. I never got more than about $8 an hour, but with tips it could be reasonably lucrative for a student or even a single person. During the "Season" you could make some good dosh. But come winter.....nada. Thank goodness you were working in a restaurant or you'd starve!
Restauranting is a tight margin business, even if you're Gordon Ramsay, and owners factor tips into the wages paid to floor staff. But that is no reason a customer should be forced to tip. It defeats the whole object.
I find the story a tad suspicious as I can't imagine a restaurant going after a customer for a tip let alone having them arrested or a cop arresting them. Who would risk eating there again? They'd be far more likely to sack the FSU for gross misconduct. Or I would anyway!

But this was the states so perhaps things have changed a tad in 25 years and its now acceptable to be harrassed by FSUs.
The one thing I do notice about FSUs here is their propensity to ignore you once you've got your grub. I don't think there's anywhere else I can remember where I've had to wait so long to be noticed, have a plate cleared or asked if I want a second drink.
Even if, or especially if, its hugely busy, being acknowledged and
served, makes all the difference in the world.
THAT is what you're tipping for!
PJH