Federal Minimum Wage Laws
While there is a minimum wage in place, it does vary from state to state. The federal minimum wage is $7.25 per hour. Where employees make tips, the wages are, in some cases, significantly lower.
The federal government requires a minimum tipped wage of at least $2.13 per hour. That means any employee who earns $30 per month in tips per month must make a minimum tipped wage of $2.13 /hr.
If an employee’s wages and tips do not equal the federal minimum wage of $7.25 per hour during any week, the employer is required to increase cash wages to compensate.
Here is a breakdown of minimum wages and tipped wages across the country.
Minimum Wage and Tipped Wages
Alabama: $2.13 No minimum
Alaska: $10.19 Same for tipped and non-tipped employees
Arizona: $12.00 tipped wage plus tips must reach $11.00
Arkansas: $2.63 tipped wage plus tips must reach $10.00
California: $12.00 or $13.00 Same for tipped and non-tipped employees
Colorado: $8.98 tipped wage plus tips must reach $12.00
Connecticut: $6.38 Bartenders’ minimum wage is $8.23, tipped wage plus tips must reach $11.00
Delaware: $2.23 tipped wage plus tips must reach $9.25
District of Columbia: $5.00 tipped wage plus tips must reach $15.00
Florida: $5.54 tipped wage plus tips must reach $8.56
Georgia: $2.13 No minimum
Hawaii: $9.35 tipped wage plus tips must reach $10.10
Idaho: $3.35 / plus tips must reach $7.25
Illinois: $6.00 / plus tips must reach $10.00
Indiana: $2.13 / plus tips must reach $7.25
Iowa: $4.35 / plus tips must reach $7.25
Kansas: $2.13 / plus tips must reach $7.25
Kentucky: $2.13 / with a minimum of $7.25 in tips
Louisiana: $2.13 Nothing specified
Maine: $6.00 / plus tips must reach $12.00
Massachusetts: $4.95 / plus tips must reach $12.75
Maryland: $3.63 / plus tips must reach $11.00
Michigan: $3.67 / plus tips must reach $9.65
Minnesota: $10.00 or $8.15 the same for tipped and non-tipped employees
Mississippi: $2.13 No minimum
Missouri: $4.73 / plus tips must reach $9.45
Montana: $8.65 or $4.00 Same for tipped and non-tipped employees. The lower wage fapplies to employers not covered by FLSA and earning less than $110,000 in gross sales.
Nebraska: $2.13 tipped wage plus tips must reach $9.00
Nevada: $8.25 Same for tipped and non-tipped employees. The minimum wage is $7.25 if there are health insurance benefits.
New Hampshire: $3.26 / plus tips must reach $7.25
New Jersey: $3.13 / plus tips must reach $11.00
New Mexico: $2.35 / plus tips must reach $9.00
New York: $11.80 to $10.40 – NYC $15.00 Tipped wage varies by industry but state-level set at $7.50 for food service employees and $9.25 for other service employees
North Carolina: $2.13 / must reach $7.25 with tips
North Dakota: $4.86 / must reach $7.25 with tips
Ohio: $4.35 / plus tips must reach $8.70. Employers who gross less than $314,000 annually will not be covered by the law
Oklahoma: $2.13 / must reach $7.25 with tips
Oregon: $11.25; $12.50
Pennsylvania: $2.83 / must reach $7.25 minimum with tips
Rhode Island: $3.89 / plus tips must reach $10.50
South Carolina: $2.13 with no specified minimum
South Dakota: $4.65 tipped wage plus tips must reach $9.30
Tennessee: $2.13 with no specified minimum
Texas: $2.13 starting to reach $7.25 with tips
Utah: $2.13 is Utah’s tipped wage / must reach $7.25 with tips
Vermont: $5.46 / plus tips must reach $10.96
Virginia: $2.13 base plus tips to reach $7.25
Washington: $13.50 Same for tipped and non-tipped employees
West Virginia: $2.62 tipped wage / plus tips must reach $8.75
Wisconsin: $2.33 base wage / with tips must make $7.25
Wyoming: $2.13 base / with tips must make $7.25
Puerto Rico: $2.13 starting / with tips $7.25
US Virgin Islands: $4.20 tipped wage / plus tips must reach $10.50
Pros and Cons of Tipped Wages
People who rely on tips to make up for low wages might find it hard going in some of these states. Depending on your base wage and how much people tip, it can be very difficult to make ends meet.
If you live somewhere where there is not a lot of tourism, where people live in poverty and don’t frequent restaurants, it is difficult to budget each month. Some states, however, will allow the employees to make a very decent wage.
There are many variations to tipping set out by each establishment. Some places require staff to pool their tips with others demanding that employees give a percentage of their tips back to the house.
Some states, like Idaho, allow employers to claim a tip credit to get employees up to minimum wage. This means employers can pay their workers $3.35 per hour and use the $3.90 tip credit to make the minimum wage of $7.25.
Disclaimer
This article should be used for informational purposes only, it should not be used as legal advice or for determining any course of action a business must take in regards to the applicable federal, state and local laws that govern its business operation and employee wages. Please consult an attorney who specializes in employment law.
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