Minimum Wages for Tipped Employees

October 1, 2008 

The following five states, not included in table, do not have State minimum wage laws: Alabama, Mississippi, South Carolina, and Tennessee. Also not included is Georgia, which exempts tipped employee law.

Some states set subminimum rates for minors and/or students or exempt them from coverage, or have a training wage for new hires. Such differential provisions are not displayed in this table.

FOOTNOTES 

1 Other additional deductions are permitted, for example for meals and lodging, except as noted in footnote 8 .

2 Minnesota. A large employer is an enterprise with annual receipts of $625,000 or more; a small employer, less than $625,000.

3 Oregon. Beginning January 1, 2004, and annually thereafter, the rate will be adjusted for inflation by a calculation using the U.S. City Average Consumer Price Index for All Urban Consumers for All Items. The wage amount established will be rounded to the nearest five cents.

4 Washington . Beginning January 1, 2001, and annually thereafter, the rate will be adjusted for inflation by a calculation using the consumer price index for urban wage earners and clerical workers for the prior year.

5 Puerto Rico . Rates are established by industry wage orders (mandatory decrees) and vary by industry, occupation or other factors. However, for employers not covered by the FLSA, a new minimum rate equivalent to 70% of the Federal minimum wage ($3.61 p.h.) supersedes all mandatory decree rates below that level, with the mandatory decree program being eventually phased out. A tip credit allowance is permitted in, 1) the restaurant, bar and soda fountain industry, which has a $3.70 minimum wage for all employees, and 2) the guest house industry, with a minimum of $2.75, but only for those employees who were hired after July 27, 1998. In addition, a lower rate is established for tipped occupations than for non tipped in the hotel industry. For hotel waiters and bellboys, the minimum wage is $2.50 or $2.25, depending on whether annual gross income is $362,500 or more or less than this amount.

6 In New Jersey , Oklahoma , and South Dakota , the listed maximum credit is the total amount allowable for tips, food and lodging combined, not for tips alone as in other states.

In New Jersey , in specific situations where the employer can prove to the satisfaction of the labor department that the tips actually received exceed the creditable amount, a higher tip credit may be taken.

7 North Carolina . tip credit is not permitted unless the employer obtains from each employee, monthly or for each pay period, a signed certification of the amount of tips received.

8 Ohio . The minimum cash wage for tipped employees of employers with gross annual sales in excess of $255,000 is $3.50 per hour (plus tips). For tipped employees of employers with gross annual sales of less than $255,000, the tipped employee hourly rate is $2.93 per hour (plus tips).

9 Oklahoma . For employers with fewer than 10 full-time employees at any one location who have gross annual sales of $100,000 or less, the basic minimum rate is $2.00 per hour, with a 50% maximum tip credit.

10 West Virginia . For employers with six or more employees and for state agencies.

11 Wisconsin . $2.13 per hour may be paid to employees who are not yet 20 years old and who have been in employment status with a particular employer for 90 or fewer consecutive calendar days from the date of initial employment.

Prepared By : 

Office of Performance, Budget, and Departmental Liaison 
Wage and Hour Division 
Employment Standards Administration 
U.S. Department of Labor 

This document was last revised in November 2008.