Comment by toomuchtodo

3 days ago

Seven states do not have a separate, lower minimum wage for tipped employees. Instead, they require employers to pay tipped employees the full state minimum wage, regardless of tips received. These states are Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington.

Sixteen states use the federal tipped minimum wage of $2.13: Alabama, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Nebraska, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, and Wyoming.

https://www.epi.org/minimum-wage-tracker/

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toomuchtodo

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godelski  3 days ago 

  > Seven states do not have a separate, lower minimum wage for tipped employees

All workers, in every state, must be paid at least minimum wage.

There's a subtle but important difference in wording. There is no "lower minimum wage" for any employee anywhere. The rule is that employers may credit tips towards pay, up to a certain amount. And they can never credit 100% of pay.

So tipped employees should always earn: minimum_wage + stochastic_number

"lower minimum wage for tipped employees" is incorrect and is just the interpretation of "minimum employer must pay after applying tip credits". Subtle, but very different things! If you aren't earning at least minimum wage (tips inclusive), then your experiencing wage theft.

The DOL page[0] specifically says "Maximum Tip Credit Against Minimum Wage" and that's how the column "Minimum Cash Wage" is calculated, but under no circumstances[1] can the employer pay less than "Minimum Cash Wage". Anything less is illegal. ALSO under no circumstances[1] may an employee earn less than minimum wage.

[0] https://www.dol.gov/agencies/whd/state/minimum-wage/tipped

[1] We're ignoring allowed deductions like lodging and meal

  • kelnos  2 days ago

    Right, but if a tipped employee in a lower-tipped-minimum state doesn't make the full minimum wage when their tips are included, it's a lot easier in a place like that for a shady employer to fail to top up their wage. Yes, in theory there are ways for employees to get this enforced, but in practice they are very reasonably and understandably wary about making use of those legal avenues.

    Not to mention that in a state where there is no lower tipped-wage minimum, all tips go to the employees directly. In a state where the tipped minimum is lower, tips effectively go to the employer for the amount between the tipped minimum and regular minimum, as that's a cost the employer would otherwise have to pay.

  • verall  2 days ago

    I knew someone who worked a graveyard shift at a Waffle House in NC. After their first month, when tips were distributed, they did not make the federal minimum wage, so they had to request additional pay to get to minimum wage (IIRC it was not automatic).

    Waffle house then opened an "inquiry" since if they weren't making minimum wage through tips, it must have been because their service was poor (of course it's actually because it was a weekday graveyard shift).

    They got their additional $30 or whatever and were then let go.

    So while I agree it is illegal to pay less than federal minimum wage, even with tips, but in practice the system is built such that for poor workers in poor areas, they will frequently make less than minimum wage.

    Although probably much less nowadays since the $7.25 is still the federal minimum wage and it's pretty hard to find people desperate enough to work for that little money since recent inflation.