What are the laws governing wages and tips for tipped employees?

In Pennsylvania, tipped employees must be paid at least the minimum wage, which is currently $7.25 per hour. Although employers can take a “tip credit” of up to $3.63 per hour to help offset wages, workers must receive at least $3.62 per hour in wages to ensure that their total earnings meet or exceed the minimum wage. Employers must also clearly inform tipped employees of their rights prior to payroll deductions. They can do this in writing or orally. Employees must also consent to the deductions, which cannot exceed 15% of the gratuity. Additionally, employers must pay employees all tips and gratuities left by customers, and the employees must receive their tips in full at least once per week. Employers cannot withhold tips for any purpose, such as customer refunds or breakage, and they cannot require employees to share tips with supervisors or other workers. Finally, there are some rules regarding the handling of taxes on tips. Employers must withhold federal income taxes on any tips employees receive, and employees must report their tips to their employers on a regular basis. Employers must also pay applicable state and local taxes on the tips. In conclusion, the laws governing wages and tips for tipped employees in Pennsylvania are clear and straightforward. Employers must pay employees at least the minimum wage and ensure they receive all gratuities left by customers. Furthermore, employers must also withhold applicable taxes on tips and have employees report their tips accurately.

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What are the laws governing wages and tips for tipped employees?

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