Navigating the Treacherous Waters of Tipped Employee Wages

Burr & Forman
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As evening sets, many restaurants will find themselves bustling with customers and loyal patrons eager to put the day's work to rest. But while managers focus on reservations, inventory, food allergies, and table checks, obligations owed to employees are always present. The complex laws that govern wage and hour compliance are particularly challenging whenthe workforce includes service employees.

Most waiters and waitresses will earn a majority of their pay from customer tips. Under federal law, restaurants are only required to pay $2.13 per hour to tipped employees who customarily and regularly make more than $30.00 in tips a month, with tip money making up the difference between the paid hourly rate and the federal minimum wage ($7.25 per hour). When an employee's hourly wage and tips do not add up to the minimum wage, then the employer must pay the difference.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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