10 Things to Know about the Tipped Minimum Wage in New York

In view of the current debate about whether the tipped minimum wage for servers in restaurants should be eliminated, here are 10 things that you need to know about the tipped minimum wage in New York:

1.      Restaurants may pay their employees a “tipped minimum wage,” which is lower than the full minimum wage, if an employee receives enough tips.  The employee must also be notified in writing that the restaurant will pay them less than the full minimum wage and will be paid more if tips do not bring their pay up to the minimum wage.  The difference between the full minimum wage and the tipped minimum wage is called the “tip credit.”

2.     The tipped minimum wage amount differs among region, industries, and occupations. 

3.     Paying a tipped minimum wage is not permitted for “fast food” restaurant workers.

4.     For 2018, under the New York Hospitality Wage Order, food service employees in restaurants, including servers, bussers, and bartenders, can be paid an hourly tipped minimum wage as follows:

• New York City restaurants with 11 or more employees may pay tipped employees $8.65.
• New York City restaurants with 10 or fewer employees may pay tipped employees $8.00.
• Nassau, Suffolk and Westchester restaurants may pay tipped employees $7.50..
• Restaurants in the remainder of the state, i.e. outside of New York City and Nassau,    Suffolk and Westchester, may pay tipped employees $7.50.

5.     For 2018, under the Hospitality Wage Order, service employees in restaurants, (e.g. coat check or delivery person), can be paid an hourly tipped minimum wage as follows:

• New York City restaurants with 11 or more employees may pay tipped employees $10.85.
• New York City of 10 or fewer employees may pay tipped employees $10.00.
• Nassau, Suffolk and Westchester restaurants may pay tipped employees $9.15.
• Restaurants in the rest of the state, i.e. outside of New York City and Nassau, Suffolk and Westchester, may pay tipped employees $8.65.

6.     Restaurants may require directly tipped food service workers to share their tips with other food service workers who participated in providing service to customers and may set the percentage to be given to each occupation.

7.     Before the start of employment, a restaurant must give each employee written notice of the employee's regular hourly pay rate, overtime hourly pay rate, the amount of tip credit, if any, to be taken from the basic minimum hourly rate, and the regular payday. The written notice must also state that extra pay is required if the tips received add up to less than the basic minimum hourly rate.

8.     Restaurants must pay tipped workers overtime hours worked at time and one-half (1 ½) the full minimum wage rate less the tip credit.

9.     Restaurants are prohibited from demanding or accepting any tip left for an employee or retaining any part of a tip.

10.  Restaurants cannot take a tip credit for any day in which employees work more than 20%, or 2 hours, whichever is less, of the workday in a non-tipped job.