labor lawAdivision of labor law center

Effective January 1, 2010 the tipped minimum wage for food service workers in New York increased to $4.75 per hour. Under the same regulations, on January 1, 2011 the tipped minimum wage will increase to $5.00 per hour.

Restaurant owners should be prepared for further increases in the state tipped minimum wage. The Labor Commissioner has said that these two increases are just the first step in increasing the tipped minimum wage to the same level as the minimum wage for non-tipped employees, currently $7.25.

Several states including Washington already require that tipped employees be paid the same minimum wage as other workers.

Under the new regulations, the Labor Commissioner also requires that New York employers must inform workers of the tip credit to be taken. If an employer neglects to notify employees, no credit is allowed. This requirement for employers covered under the federal minimum wage law has now been extended to employees covered by the New York state minimum wage law. For example, (more…)

Most employers in the state are already aware that on July 24, 2009 the Florida minimum wage will increase by 4 cents from $7.21 to $7.25 per hour. That is because the federal minimum wage increases on that date – and by statute, the Florida minimum wage cannot be lower than the federal minimum wage.

However, many Florida employers have questions about the effect this will have on the Florida minimum wage for tipped workers.

Currently, under Florida law, employers are permitted to take a “tip credit” of up to $3.02 per hour. This means that the Florida employer can pay a worker who regularly earns tips $3.02 per hour less than the minimum wage.

That makes the Florida tipped minimum wage $4.23 per hour beginning July 24, 2009. That is 4 cents per hour higher than the Florida tipped minimum wage of $4.19 established on January 1, 2009.

However, the tip credit the employer takes in any payroll week cannot be greater than the actual tips earned by the employee. If the employee earns less than $3.02 per hour in tips on average over the payroll week, the employer must pay the difference.

Suppose John is a food server in Miami. His hourly rate is $4.23. During John’s first week, he works 20 hours and earns just $20 in total tips. That is an average of $1 per hours in tips. The employer must pay John an additional $2.02 for each hour that John worked, to bring his total earnings up to the minimum wage of $7.25 per hour. The employer adds $40.40 to John’s paycheck as a “tip differential.” This is the difference between the salary plus tips actually earned, and the minimum wage.

John earns $4.23 per hour x 20 hours = $84.60 in wages. In addition, (more…)

The minimum wage for tipped employees in North Carolina has been reduced to $2.13  per hour, for now, despite the increase in the state and federal minimum wage on July 24, 2008.

On July 24, both the federal and North Carolina minimum wages increased to $6.55 per hour. However, employees who earn at least $30 per month in tips can be paid less.

Until recently, the minimum wage for tipped workers in North Carolina was (more…)