What's the difference between "tu" and "vous"?

One is formal and one is informal. "Tu" is used amongst friends and family, whereas "vous" is used for most people who are older than you by at least 5 years. In school, students say "vous" to all adults and "tu" to all students even if they are more than 5 years older. You refer to anyone your than you as "tu" unless you are in a formal situation (e.g. job interview or bank) or that you are unsure as to whether they are younger than you or not.
At work colleagues that have the same rank would say "tu" to each other, but most certainly "vous" to their managers unless they know them well. "Know them well" means that they hang out outside of work.