Can an employer pay a tipped employee not making tips at a specific period of time less then $7.25 an hour?

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Can an employer pay a tipped employee not making tips at a specific period of time less then $7.25 an hour?

Asked on June 4, 2012 under Business Law, Iowa

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

The issue is not whether the tipped employee makes more than $7.25 each individual hour; it's whether, between the wages paid and tips received, the employee on average makes more than $7.25 per hour. So if the employee's total weekly compensation, pay and tips, equals or exceeds $290 (based on a 40 hour week; if he or she works more or less, adjust the threshhold amount accordingly), there is no legal violation even if certain of those hours, viewed in isolation, had total compensation of less than $7.25.


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