Are employers allowed to pay tipped and non-tipped employees different wages?

In Arizona, employers are allowed to pay tipped and non-tipped employees different wages, though there are some requirements that must be met. Tipped employees are employees who regularly receive more than $30 per month in tips. Employers in Arizona must pay tipped employees a minimum wage of at least $7.25 per hour, which includes both the cash wage and the tips they receive. Non-tipped employees, on the other hand, must be paid Arizona’s minimum wage, which is currently $12.00 per hour. Employers must also pay non-tipped employees at least the minimum wage for any overtime hours they work. If tipped employees do not earn enough in tips to reach the minimum wage, their employers must make up the difference in cash wages. For example, if an employee earns $6.00 per hour in tips and the minimum wage is $12, the employer must pay an additional $6.00 per hour in wages. Employers must also keep records of all wages and tips paid to their employees. These records must be kept for at least three years in case questions arise about an employee’s wage or hours worked. Thus, employers in Arizona are allowed to pay tipped and non-tipped employees different wages, though there are certain state and federal requirements that must be met.

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Are employers allowed to pay tipped and non-tipped employees different wages?

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