Do tips count as part of an employees minimum wage which must be paid by the contractor?
An employee engaged in an occupation in which he or she regularly receives more than $30 a month in tips may have the amount of tips credited by the employer against the minimum wage required by the SCA. The following rules must be observed: (1) The employer must notify the employee about the tip credit allowance before the credit is utilized; (2) The employees must be allowed to retain all tips (individually or collectively); (3) The employer must be able to show by records that the employee receives at least the applicable SCA minimum wage through the combination of direct wages and tip credit; and (4) The use of the tip credit must have been permitted under any predecessor collective bargaining agreement applicable by virtue of section 4(c) of the SCA.
