A comprehensive look at the tip wage
From Compensation & Benefits Review
Employers increasingly face wage and hour enforcement actions and costly class action lawsuits under the federal and state laws that regulate minimum wages and tipping. With wide variations in federal and state requirements regarding tip credits, tip pooling and service charges, companies must carefully review their policies to avoid labor department investigations and significant liabilities for back pay.
This article considers the tip credit – the amount of tips that may be applied toward the required minimum wage. It outlines common employer practices and pitfalls in calculating pay and overtime pay for tipped employees and keeping records for wages and hours. A number of steps have been advised that employers can take to ensure that their pay practices are legal, to avoid lawsuits that can generate multi-million-dollar settlements, (more…)
SAGE Insight 