UnderCover Waitress: Tipped Employees Minimum Wage

Friday, January 13, 2012

Tipped Employees Minimum Wage

This is big. Change.org is focusing on tipped employee's wages.

The federal government sets the minimum wage that an employer can pay an employee. This rule applies to every state in the union. States, however, may choose to set a higher minimum wage for it's workers. States may not set a minimum wage lower than the federal government. That is why minimum wage is higher in some states than others.

According to the federal government, tipped employees may have a lower minimum wage than other employees. In 1992, the federal government set the tipped employees minimum wage to $2.13 per hour. It is still $2.13 per hour today.

Some states set a higher minimum wage for tipped employees. For example, in Vermont tipped employees make a minimum of just under $4 per hour. In California, tipped employees make the same minimum wage as any other worker in that state.

California, however, is an exception to rule. Most waitresses in the country make a base wage of less than $5 per hour.

A waitress is expected to make up the difference between her wage and minimum wage with tips. This difference is called a "tip credit." Technically, employers are required to make up the difference if the waitress does not earn enough in tips on any given shift, but I have never heard of that actually happening.

Congress has the opportunity to pass the Working for Adequate Gains for Employment in Services (WAGES) Act which is the first bill ever introduced into Congress focusing on tipped workers. According to MomsRising.org, the WAGES act would significantly close the wage gap that currently exists between tipped employees and all other workers by:

  • Raising the minimum wage of tipped employees from the current level of $2.13 per hour to $3.75 per hour 90 days after enactment. 
  • It would then raise the minimum wage of tipped employees to $5.00 per hour one year after enactment. 
  • Finally, two years after enactment, the tipped minimum wage would be increased to 70% of minimum wage, but no less than $5.50 per hour.

If you or anybody you know has ever worked as a tipped employee, go to MomsRising.org to share your story and urge Congress to pass the WAGES act. 


  1. Based on where I have worked, you are right, HUGE news. Companies are supposed to pay the difference if your tip wage+tips earned does not equal the state minimum wage per hour (evened out through the weekly hours.) I use the phrase "supposed to," because on more than one occasion, restaurants that myself and friends have been employed in actually go through at the end of the week/pay period and change tip declarations for the employees, regardless of whether they make the money or not. Excuses have been given that "Well if you aren't making the minimum wage in this restaurant on tips alone, you shouldn't be working here anyways(changing tips to save a few bucks at corporate payroll level)" to "We want to ensure you won't be audited and are just making sure everyone is claiming at least the (x%) required by law. Either way, this could very effectively close the gap, and would help get a little more even footing for everyone in the industry.

  2. Anonymous, thank you for bringing up the bit about "if you can't make so many $$ in tips, you shouldn't be working here" baloney. That is, at best, a poor excuse for management to save a corporation a few bucks, and at worst its a veiled threat.

    First, it assumes that waitresses control how much they are tipped, each and every time. Some people are cheap and wouldn't tip well if she tied their shoes for them. Second, it makes the waitress feel that if she complains about not making enough in tips, she will be fired.

    That stuff annoys the hell out of me.

  3. So, we make it even less likely people will have a job at all?

    1. Baloney. The restaurant industry in Florida is doing quite well. If owners are feeling a pinch, they can find ways to ease the pinch without stepping on the necks of their most vulnerable employees.
      That is a false alarm and a scare tactic. Thank you for reminding me that I need to write more about trends in Florida's restaurant industry.

      A counter argument is that when nobody can make ends meet on the plethora of poorly-paid jobs, so-called "employers" can pay more into food stamps.

    2. Hey fool--in California we pay all workers $8/hr min. Guess what--we still have lots of waitress jobs. anon, you're an idiot!

  4. This is shocking. I am a California employer and never even thought about paying my servers any less than anyone else. I am really proud of my state for mandating that. It's amazing what goes on in some states to keep the poorest paid from rising up to a decent wage. Bravo to Congress for initiating this. We ARE the 99%!!!

  5. I work at an Applebees in Michigan, and every night when we enter our tips into the computers, even if we put in exactly what we made, we usually have a pop-up telling us we didn't claim enough. A manager has to override the pop-up, and then we can clock out. But I know for a fact that it's not used to 'protect' us, since I've done the math and noticed it only flags us when our tps+ hours worked doesn't equal minimum wage. Total scare tactic too, since the verbage mentions federal guidelines, etc. Also its fun to see payroll 'screwing up' our checks, only to get the hours 'added on next week'. BS, I've seen managers go into the system and send an e-mail adjusting people's hours worked. Heck, management at the Jackson location was replaced, from the general manager on down due to 'adjusting' hours worked. Of course, keeping 'labor low' was part of their bonus payouts. And this is only a few restaurants in the chain, in our specific brand...The sooner the wage is raised, the sooner I hope these kinds of tactics start coming to an end.


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