Tipped Minimum Wage (United States)

The federal cash wage for tipped workers has been 2.13 dollars an hour since 1991, with tips required to bring total pay to at least 7.25 dollars.

Overview

Under the Fair Labor Standards Act, employers may take a tip credit, paying a lower cash wage as long as tips lift the worker to the full minimum, with the employer covering any shortfall. Enforcement of that guarantee is a persistent problem. Several states, including California, Washington and Oregon, ban the tip credit and require the full state minimum before tips, and other jurisdictions have voted to phase it out. Restaurant groups argue the system supports high earnings for servers, while critics tie it to income instability and harassment.