There appears to be much confusion about tips and wages in the United States. There is a Federal law, the FLSA (Fair Labor Standards Act) and some separate state laws that define breaks
Federal Minimum Wage:
Certain full-time students, student learners, apprentices, and workers with disabilities may be paid less than the minimum wage under special certificates issued by the Department of Labor.
Tip Credit: Employers of "tipped employees" must pay a cash wage of at least $2.13 per hour if they claim a tip credit against their minimum wage obligation. If an employee's tips combined with the employer's cash wage of at least $2.13 per hour do not equal the minimum hourly wage, the employer must make up the difference. Certain other conditions must also be met.
Tipped Employees Under the Fair Labor Standards Act (FLSA)
FEBRUARY 2023 >• >9
minute read
An employer can take an FLSA tip credit equal
to the difference between the direct wage, or the cash wage it pays
directly to the tipped employee, and the federal minimum wage, which
is currently $7.25 per hour. The maximum tip credit that an employer
can currently claim is $5.12 per hour: ($7.25 - $2.13 direct (or
cash) wage = $5.12). Only tips actually received by the employee
count when determining whether the employee is a tipped employee and
in applying the tip credit.
Employers claiming a tip credit must
be able to show in each workweek that tipped employees receive at
least the full federal minimum wage when direct (or cash) wages and
the tip credit amount are combined. If an employee’s tips combined
with the employer’s direct (or cash) wages do not equal the minimum
hourly wage of $7.25 per hour in each workweek, the employer must
make up the difference.
Employers, Including Managers and Supervisors, May Not “Keep” Tips: Regardless of whether an employer takes a tip credit, the FLSA prohibits employers from keeping any portion of employees’ tips for any purpose, whether directly or through a tip pool. An employer may not require an employee to give their tips to the employer, a supervisor, or a manager, even where a tipped employee receives at least the federal minimum wage (currently $7.25) per hour in wages directly from the employer and the employer takes no tip credit.
Tip pooling: The FLSA allows employers to
require employees to share or “pool” tips with other eligible
employees. The FLSA does not impose a limit on the percentage or
amount of the contribution of each employee in valid mandatory tip
pools. As explained below, the rules governing tip pools depend on
whether the employer pays a direct (or cash) wage equal to the full
minimum wage to tipped employees or not.
Traditional
Tip Pooling: An employer that takes a tip credit can
require tipped employees to contribute tips only to a tip pool which
is limited to employees in occupations in which they customarily and
regularly receive tips, such as waiters, bellhops, counter personnel
(who serve customers), bussers, and service bartenders. This is
sometimes known as a “traditional” tip pool. An employer that
implements a traditional tip pool must notify tipped employees of
any required tip pool contribution amount, may only take a tip
credit for tips each tipped employee ultimately receives, and may
not retain any of the employees’ tips for any other purpose. An
employer may not receive tips from such a tip pool and may not allow
managers and supervisors to receive tips from the pool.
Other Tip Pooling: When an employer pays its
employees a cash wage of at least the federal minimum wage
(currently $7.25) per hour, the employer may impose a mandatory tip
pooling arrangement that includes employees who are not employed in
an occupation in which employees customarily and regularly receive
tips. This is sometimes known as a “nontraditional” tip pool. For
example, an employer that implements a nontraditional tip pool may
require tipped employees, such as servers, to share tips with
non-tipped employees, such as dishwashers and cooks, but only if all
workers receive a direct cash wage of at least the federal minimum
wage. In addition, an employer may not receive tips from such a tip
pool and may not allow managers and supervisors to receive tips from
the pool.
Distributing Tips from Tip Pools:
When an employer collects tips to administer a tip pool, the
employer must fully distribute any collected tips at the regular
payday for the workweek, or, for pay periods of more than one
workweek, at the regular payday for the period in which the
particular workweek ends. To the extent an employer cannot determine
the amount of tips received or how tips should be distributed before
processing payroll, those tips must be distributed to employees as
soon as practicable after the regular payday.
Also see Restaurant Workers' rights
For additional information, visit our Wage and Hour Division Website: >http://www.dol.gov/agencies/whd >and/or call our toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866-4USWAGE (1-866-487-9243).
Overtime Pay: At least 1.5 times an employee's regular rate of pay for all hours worked over 40 in a workweek.
Child Labor: An employee must be at least 16 years old to work in most non-farm jobs and at least 18 to work in non-farm jobs declared hazardous by the Secretary of Labor. Youths 14 and 15 years old may work outside school hours in various non-manufacturing, non-mining, non-hazardous jobs under the following conditions:
No more than -
Also, work may not begin before 7 a.m. or end after 7 p.m., except from June 1 through Labor Day, when evening hours are extended to 9 p.m. Different rules apply in agricultural employment.
ENFORCEMENT: The Department of Labor may recover back wages, either administratively or through court action, for the employees that have been underpaid in violation of the law. Violations may result in civil or criminal action.
Fines of up to $11,000 per violation may be assessed against employers who violate the child labor provisions of the law and up to $1,100 per violation against employers who willfully or repeatedly violate the minimum wage or overtime pay provisions. This law prohibits discriminating against or discharging workers who file a complaint or participate in any proceedings under the Act.
Note:
FOR ADDITIONAL INFORMATION, contact the nearest Wage and Hour Division office -- listed in most telephone directories under United States Government, Labor Department.
Contact the Wage-Hour Division to report a potential FLSA unpaid wage violation, at:
The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments. Covered nonexempt workers are entitled to a minimum wage of not less than $7.25 per hour effective July 24, 2009. Overtime pay at a rate not less than one and one-half times the regular rate of pay is required after 40 hours of work in a workweek.
On >October 13, 2022, the U.S. Department of Labor published a >Notice of Proposed Rulemaking (NPRM) that proposes to revise the Department’s guidance on how to determine who is an employee or independent contractor under the Fair Labor Standards Act (FLSA). The NPRM proposes to rescind the rule, Independent Contractor Status Under the Fair Labor Standards Act (2021 IC Rule), that was published on January 7, 2021, and replace it with an analysis for determining employee or independent contractor status that is more consistent with the FLSA as interpreted by longstanding judicial precedent. The Department believes that its proposed rule would reduce the risk that employees are misclassified as independent contractors, while providing added certainty for businesses that engage (or wish to engage) with individuals who are in business for themselves. More information about the rule can be found >here.
Ways to save money AND help the environment:
Eat healthier AND save money: Instant Pot Duo Crisp 11-in-1 Air Fryer and Electric Pressure Cooker Combo with Multicooker Lids that Fries, Steams, Slow Cooks, Sautés, Dehydrates
Save water AND money with this showerhead adapter, it lets the water flow until the water is hot, then shuts off water flow until you restart it, ShowerStart TSV Hot Water Standby Adapter
Protect your health with these:
Mattress Dust mite-Bedbug protector, 100% Waterproof, Hypoallergenic, Zippered
Handheld Allergen Vacuum Cleaner with UV Sanitizing and Heating for Allergies and Pet, Kills Mite, Virus, Molds, True HEPA with Powerful Suction removes Hair, Dander, Pollen, Dust,
Immune Support Supplement with Quercetin, Vitamin C, Zinc, Vitamin D3
GermGuardian Air Purifier with UV-C Light and HEPA 13 Filter, Removes 99.97% of Pollutants
5 Stage Air Purifier, Features Ultraviolet Light (UVC), H13 True Hepa, Carbon, PCO, Smart Wifi, Auto Mode, Quiet, Removes 99.97% of Particles, Smoke, Mold, Pet Dander, Dust, Odors
Interesting Reads:
THE PREPPER'S CANNING & PRESERVING BIBLE: [13 in 1] Your Path to Food Self-Sufficiency. Canning, Dehydrating, Fermenting, Pickling & More, Plus The Food Preservation Calendar for a Sustainable Pantry
The Backyard Homestead: Produce all the food you need on just a quarter acre! Paperback
The Citizens' Guide to Geologic Hazards: A Guide to Understanding Geologic Hazards Including Asbestos, Radon, Swelling Soils, Earthquakes, Volcanoes
The Uninhabitable Earth: Life After Warming
Book: The Sixth Extinction: An Unnatural History Paperback
