What is the Minimum Wage
for Workers that Receive Tips?
Minimum wage laws are different for workers who receive tips, such as waiters, busboys, delivery people, barbers, bartenders, and taxi drivers. The minimum wage for tipped employees is based on the federal wage of $7.25 an hour. This means that employers only have to pay $2.13 an hour, provided that the employee, with tips, will earn a minimum of $7.25 an hour. If the tipped minimum wage does not equal to at least $7.25, the employer is legally required to make up the difference.
However, most states have minimum wages that exceed $7.25 an hour. For example, in New York, minimum wage is at $10.40 an hour. The minimum wage in New York City is even higher, at $13 an hour for businesses with 11 or more people. Base wages for tipped employees are currently at $8.65 an hour. There are also different requirements for fast food workers. Wages are expected to increase annually through 2021.