Filed under Managing the Workplace. Fact checked on May 25, 2012.
Special rules apply to the minimum wage that must be paid to tipped employees. Many states allow employers take a tip credit towards the hourly minimum wage rate.
It's important for employers with tipped employees to pay their employees correctly pursuant to federal and state minimum wage laws. The rule is that if the federal minimum wage minus the federal tip credit is lower than your state's minimum wage minus your state's tip credit (if any), you must pay your employees the higher amount.
Click on your state on the map below to find out what your state law obligations are for tipped employees. States that are unshaded have no enacted laws regarding tip credits.
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State laws may apply to the minimum wage amount an employee must be paid per hour. Employers in some states must pay a higher hourly rate than under federal law if their state minimum wage is higher than the federal rate.
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