Covid-19: We are still open and our employment attorneys are available for you. If you have been forced to work against the government orders or wrongfully fired, call us now. For more information on Coronavirus related employment laws, click here.

The Spitz Law Firm, LLC

Wage: Tipped Employees

Wage: Tipped Employees

The Employee’s Attorney: Ohio Sales Commission Dispute Lawyers

The Most Important Thing You Can Do Today: Call The Right Attorney™

Our lawyers focus to fight for the rights of tipped employees. For many workers – waiters, waitresses, servers, bartenders, and valets, for example – tips are their primary source of income. You will likely be considered a tipped employee if you customarily and regularly earn more than $30 each month in tips.

If you are a tipped employee, your job can pay tipped employees less than the minimum wage. However, the Fair Labor Standards Act (FLSA) and Ohio wage laws set out several rules that employers must follow when employing tipped workers. Under the FLSA and Ohio laws, your employer can take a maximum tip credit against the minimum wage. While the FLSA provides that an employer can take up to a $5.12 maximum tip credit against the federal minimum wage of $7.25, Ohio law requires employers that have at least $297,000 in gross sales to pay a minimum wage of $8.10 per hour while taking only a $4.05 maximum tip credit. This means that most tipped employees in Ohio must be paid a minimum cash wage of $4.05 per hour as long as your tipped income makes up the full difference up to least to the level of the federal- and state-required minimum wages.

Now, your employer can only take the tip credit for the work that you, as a tipped employee, are doing in a historically tipped role. For example, if your boss makes tipped employees come in on a Saturday morning before the restaurant opens to polish the silver or scrape gum off the bottom of tables, you should be paid at least the full minimum wage.

Importantly, your job can only apply tips that you actually got toward the tip credit applied to the minimum wage. So, if you are working in a slow diner and only got $10 in tips over a five-hour shift, your job can only take a $2 per hour tip credit – meaning your job has to pay you the minimum hourly wage less $2 per hour for all hours worked.

While tips may be used in some circumstances as a credit toward your employer’s obligation to pay tipped employees minimum wage obligation, your job cannot use your tips for any other reason, with the possible exception of making you pay credit card fees on your tips. Your tip is exclusively your property. The FLSA expressly makes it unlawful and will void any contract or agreement between an employer and a tipped employee agrees to share any portion of the tip with the employer or owner of the business. For instance, even in situations where an employee is paid the full minimum wage, there can be no agreement or other arrangement where the tipped employee has to turn over any portion of tipped income to the employer or owner of the company.

Now, that being said, the FLSA legal requirement that tipped employees must retain all their tips does not prevent your job from setting up a tip pooling, but the tip pool also has requirements to be allowed. Under these requirements, your boss/job: (1) must notify you and all tipped employees of any required tip pool contribution amount; (2) just like straight tips, can only take the tip credit against the minimum wage for actual tips that you ultimately get; and (3) just like straight tips, cannot keep any of the tips from the tip pool. If you have to share money from the tip pool with any typically nontipped employees such as cooks, dishwashers, managers or even the owner, the tip pool becomes invalid and your employer cannot take a tip credit at all. This means that you would be entitled to the full minimum wage in your paycheck and would still get to keep all of the tips that you kept.

If you are a tipped employee, make sure you know your rights so your employer is not in violation of the FLSA. If you find yourself saying any of the following, you should call a wage and hour attorney immediately about a possible wage theft claim:

  • My boss is stealing my tips.
  • My manager is sharing in our tip pool at the restaurant.
  • I have to share my tips with the cook.
  • I was forced to pay for dine and dash losses out of my tips.
  • The restaurant that I work at makes me do an hour of kitchen prep work before and after my serving shift but still pays me at server rate for those hours.
  • The owner of the bar that I work at tends bar and takes tips out of the tip pool.
  • My supervisor makes me give tips to the dishwashers.
  • I’m not making minimum wage even after I get all my tips.
  • What should I do if my job says I got more tips than I actually got?
  • My paycheck is wrong.
  • I don’t get to keep all of my tips.
  • I am a tipped employee and want to sue for wage violations at the bar that I work at.

Thus, an employer cannot make any deduction based on a dine and dash, breakage or any other reason that results in the employee’s wages being less than minimum wage for the given pay period. The restaurant or bar cannot avoid a violation even if the employee’s tips were high enough to still keep their full pay rate at or above the minimum wage after the employer makes a deduction based on a dine and dash. The simple principle here is that under federal law, tips belong to the employee, not the employer.

Are you a waiter, waitress, or server at a restaurant who depends on tips to live? Know your rights as a tipped employee. If your employer has committed any of the above violations or if you have any other questions about how the FLSA applies to tipped employees, contact the employment law attorneys at The Spitz Law Firm, LLC, for a free initial consultation. If you believe that your employer is not paying you all of your wages for all of your lawfully earned compensation or is keeping your tips in violation of the Federal Fair Labor Standards Act or Ohio Fair Labor Standards Act, contact the attorneys at The Spitz Law Firm, LLC, today for a free and confidential initial consultation.

Get A Free Consultation Call Us Today