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Q.Are tips counted towards my receipt of the minimum wage, or am I entitled to minimum wage plus tips?

A.Tipped employees are those who customarily and regularly receive at least $30 a month in tips. Under the Fair Labor Standards Act ("FLSA"), the employer must pay not less than $2.13 an hour in direct wages. However, if an employee's tips combined with the employer's direct wage contribution of at least $2.13 an hour do not equal the federal minimum hourly wage of $7.25 per hour, the employer must pay the employee the difference.

Employees working in the state of California are entitled to California's minimum wage ($8 per hour) plus all of their tips. An employer may not use an employee's tips as a credit toward its obligation to pay the minimum wage.

The following table shows the minimum hourly wage for tipped employees at the Federal level under the Fair Labor Standards Act (FLSA) and at the state level. Some states, like the FLSA, allow employers to claim a tip credit as an offset against the minimum wage, while other states (like California) do not permit a tip credit.

Table of Minimum Hourly Wages for Tipped Employees, by State
State Combined Cash & Tip
Minimum Wage
Maximum Tip Credit
Against Minimum Wage
Minimum Cash Wage Special Notes
Federal $7.25 $5.12 $2.13
Alabama N/A N/A N/A State law does not provide for a minimum wage.
Alaska $7.75 $0 $7.75 State law does not allow tip credit.
Arizona $7.35 $3.00 $4.35
Arkansas $6.25 $3.62 $2.63 Tipped employee must earn at least $20 in tips per month.
California $8.00 $0 $8.00 State law does not allow tip credit.
Colorado $7.36 $3.02/td> $4.34 Tipped employee must earn at least $30 in tips per month.
Connecticut $8.25 $2.56 $5.69 Tipped employee must earn at least $10 in tips per week if full time and $2 per day in tips if part time in the hotel and restaurant industries. The maximum tip credit for bartenders who regularly receive tips is 11% and they must be paid a minimum cash wage of $7.34
Delaware $7.25 $5.02 $2.23 Tipped employee must earn at least $30 in tips per month.
District of Columbia $8.25 $5.48 $2.77
Florida $7.25 $3.02 $4.23
Georgia N/A N/A N/A State law exempts tipped employees from the minimum wage.
Hawaii $7.25 $0.25 $7.00 Tipped employee must earn at least $20 in tips per month.
Idaho $7.25 $3.90 $3.35 Tip Credit is only allowed if the total wages the employee receives is at 50 cents more than the minimum wage.
Illinois $8.25 40% $4.95 Tip Credit is only allowed if: (1) the total wages the employee receives is at 50 cents more than the minimum wage and (2) the tipped employee earns at least $20 in tips per month.
Indiana $7.25 $5.12 $2.13
Iowa $7.25 $2.90 $4.35 Tipped employees must earn at least $30 in tips per month.
Kansas $7.25 40% $2.13 Tipped employees must earn at least $20 in tips per month.
Kentucky $7.25 $5.12 $2.13 Tipped employees must earn at least $30 in tips per month.
Louisiana N/A N/A N/A There is no state minimum wage.
Maine $7.50 50% $3.75 Tipped employees must earn at least $20 in tips per month.
Maryland $7.25 Up To 50% $3.63 Tipped employees must earn at least $30 in tips per month.
Massachusetts $8.00 $5.37 $2.63 Tipped employees must earn more than $20 in tips per month.
Michigan $7.40 $4.75 $2.65
Minnesota $6.15/
$5.25
N/A $6.15/
$5.25
State law does not allow tip credit. Employers with gross annual receipts of $625,000 or more must pay the higher minimum wage.
Mississippi N/A N/A N/A State law does not provide for a minimum wage.
Missouri $7.25 $3.62 $3.63
Montana $7.25/
$4.00
$0 $7.25/
$4.00
State law does not allow tip credit. Business with gross annual sales over $110,000 must pay the higher minimum wage.
Nebraska $7.25 $5.12 $2.13
Nevada $8.25/$7.25 $0 $8.25/$7.25 State law does not allow a tip credit. Businesses that do not provide their employees with health insurance must pay the higher minimum wage.
New Hampshire $7.25 55% 45% Tipped employees must earn more than $30 in tips per month.
New Jersey $7.25 $5.12 $2.13
New Mexico $7.50 $5.37 $2.13
New York $7.25 $5.12 $2.13 New York provides a different tip credit depending on the employee’s average tips and industry. For employees in the restaurant and hotel industry who average between $1.60 and $2.35 per hour in tips, the maximum tip credit is $1.60. For employees in the restaurant and hotel industry who average more than $2.35 per hour in tips, the maximum tip credit is $2.35. For food service employees in the hotel industry, the maximum tip credit is $2.60. No tip credit is allowed for building service employees.
North Carolina $7.25 $5.12 $2.13 Tipped employees must earn more than $20 in tips per month.
North Dakota $7.25 33% $4.86 Tipped employees must earn more than $30 in tips per month.
Ohio $7.40 50% $3.70 Tipped employees must earn more than $30 in tips per month.
Oklahoma $7.25 50% $3.63
Oregon $8.50 $0 $8.50 State law does not allow a tip credit.
Pennsylvania $7.25 $4.42 $2.83 Tipped employees must earn more than $30 in tips per month.
Rhode Island $7.40 $4.51 $2.89
South Carolina N/A N/A N/A State law does not provide for a minimum wage.
South Dakota $7.25 $5.12 $2.13 Tipped employees must earn more than $35 in tips per month.
Tennessee None N/A N/A State law does not provide for a minimum wage.
Texas $7.25 $5.12 $2.13 Tipped employees must earn more than $20 in tips per month.
Utah $7.25 $5.12 $2.13 Tipped employees must earn more than $30 in tips per month.
Vermont $8.15 $4.20 $3.95 Tipped employees must earn more than $120 in tips per month. The tip credit only applies to employees in hotels, motels, tourist places, and restaurants who customarily and regularly receive tips for direct and personal customer service.
Virginia $7.25 $5.12 $2.13
Washington $8.67 $0 $8.67 State law does not allow a tip credit.
West Virginia $7.25 $1.45 $5.80
Wisconsin $7.25 $4.92 $2.33
Wyoming $5.15 $3.02 $2.13 Tipped employees must earn more than $30 in tips per month.

The information on this page was last updated in January of 2011.




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