Calculating what overtime pay you might be entitled to as a tipped employee requires taking into account your employer’s tip credit, which is your employer’s credit against its minimum wage obligation to you.
Under the Fair Labor Standards Act (FLSA), tipped employees are those who customarily receive tips and regularly earn more than $30 each month in tips, including workers such as:
- Waiters and waitresses
Based on the current minimum wage of $7.25 per hour, an employer must pay you a wage of $2.13 per hour and may use the FLSA tip credit of $5.12 per hour against the required minimum wage payment.
Overtime is calculated on the full minimum wage, not the lower cash wage payment. Your employer cannot take a larger tip credit for overtime hours than for regular hours.
The trouble in calculating the tip credit arises for many tipped employees when tips are pooled or shared. Tip pooling is allowed under FLSA, but only among employees who regularly receive tips, which excludes staff such as dishwashers and cooks. Your employer cannot require illegal tip pooling and count it against their wage credit.
Do you think you may be entitled to overtime pay that your employer is not providing? To understand your rights and legal options, call experienced overtime lawyer James Shoemaker today at 757-223-4580 for your case consultation.
Located in Newport News, Mr. Shoemaker represents clients throughout the Virginia, Virginia Beach, and Washington, DC, areas.